Tips & Tricks to get investor ready | 13 Oct
The agro-food sector is one of the few bright spots in turbulent times. “The sector offers interesting investment opportunities,” argues Wilco Schoonderbeek, investment manager within PPM Oost NV, a government backed Venture Capitalist (VC). At the Food Valley Expo on 13 October he explains what entrepreneurs need to do to attract venture capital and get ‘investor ready’.
In the next decades, both the growing population and economic growth will result in an increased demand for crop and food production. However, there are significant concerns about declining levels of yield gain due to water shortages, reduced use of pesticides and global warming. Besides the traditional focus on increasing consumption, today’s technology allows us to produce individually designed human dietary proteins based on the application of biotechnology to molecular nutrition.
Given the window of opportunity, there are still relatively few active VCs in the agro-food sector. However, recent developments indicate that the industry is about to change. The sector is a data hungry industry that, historically, has not been served very well. The emphasis on IT and Big Data will attract some of the well-known VCs to step in.
“The agro-food technology environment is granular and complicated”, says Schoonderbeek. “You need to invest time to understand the pitfalls in order to successfully deploy capital. Firstly, you have to establish a mature ecosystem to generate enough seed and early stage investment opportunities. While we are faced with global challenges, I believe the required innovation will happen through research and entrepreneurial networks at a regional scale. Universities need to collaborate with VCs to help transform knowledge into start-up companies.”
“Secondly, you have to manage the risk/reward ratio. In general, to realize an attractive net internal rate of return for seed/early stage VC is a challenge and the sector is no exception. There are significant wildcards. Focus on social benefits will accelerate economic profits and agro-food technology provides an excellent platform for translating shared social returns to individual economic return.”
“Finally, find the right team. VCs have been reluctant to step into agro-food technology. Most of them have been watching the sector for a while and like to get involved. However, they recognize it is different and they are having difficulties finding professionals that understand the environment.
At Food Valley Expo Wilco Schoonderbeek will share his observations on how the Venture Capital Industry can support this transformation and what entrepreneurs need to do to attract venture capital and get ‘investor ready’.