By Lynda Kiernan
BASF Ventures has made its first investment in Brazil, and is one of the primary investors in Brazilian agtech-focused fund AgVentures II, committing $4 million to the fund’s first close.
BASF joins other strategic investors in the fund that include multinational companies, financial investors, international development finance institutions, and domestic family offices.
Managed by São Paulo-based SP Ventures, AgVentures II is currently the only fund in Brazil focusing its capital exclusively on ag technology. Its goal is to make 20 to 25 investments in new companies founded and headquartered in Latin America that are working to answer some of the key challenges faced by the region’s agricultural producers.
These areas would include agricultural production factors, business management, precision farming, software solutions, and livestock management; food technologies for innovative food, new ingredients and plant-based proteins, and supply chain technologies such as food safety and traceability, logistics, and processing technologies. The fund also states that it will focus on fintech and the emergence of an agriculture-focused, tech-enabled financial services industry.
“BASF is a unique anchor investor that will make SP Ventures an even better financial investor,” said Francisco Jardim, managing director, SP Ventures. “As a partner in our network and with its high profile in our region, BASF will convey institutional credibility with the entire agribusiness economy in Brazil.”
The investment is also a signal by BASF of its intent to deepen its investment presence in the Latin American market, as explained by Markus Solibieda, managing director of BASF Venture Capital, who said, “We look forward to supporting promising startups and our business colleagues with this investment. As a partner of AgVentures II, we are preparing the ground for our own future direct investment activities in Brazil and Latin America.”
It is not surprising that BASF would set its sights on Brazil, and more specifically, agtech innovation in Brazil. Agriculture is a pillar industry for the country, accounting for approximately half of the country’s exports. However, climate change, increasing threat from pests and crop diseases, as well as varying soil conditions across the nation’s growing regions have presented its agricultural producers with challenges that must be managed through innovation. This need has resulted in a rapid increase in the number of companies being launched that are using technology to develop solutions.
As a partner of AgVentures II, BASF will not only provide capital, but will also be a collaborator; sharing its expertise and market insights with the startups in SP Venture’s network.
“BASF is a unique anchor investor that will make SP Ventures an even better financial investor,” said Jardim.
“By tapping into BASF’s technical expertise and market know-how, we will also be able to make more qualified investment decisions. Moreover, BASF’s operating assets are well suited to add value to the fund’s portfolio. The venture-backed AgTech firms in our portfolio and BASF will mutually benefit from information sharing and strategic synergies.”
BASF began establishing its presence in Latin America’s agtech space with the 2016 launch of AgroStart, an acceleration program that has registered 420 agtech startups to-date.
“BASF Venture Capital’s investment in the AgVentures II Fund will provide us with the opportunity to further participate in this dynamic, innovative and co-creative environment that can bring valuable solutions to the industry,” says Manfredo Rübens, president, BASF South America.”
– Lynda Kiernan is Editor with GAI Media and daily contributor to the GAI News and Agtech Intel platforms. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.