Yakhin to invest $1m in agritech startups

Omri Boral Photo: Reuven Kapuchinsky
Omri Boral Photo: Reuven Kapuchinsky

The Impact incubator jointly run by Yakhin and Tech for Good is aimed at promoting sustainable agriculture.

Israel's Yakhin group has announced that it will invest up to $1 million per venture in ventures at the seed stage in the framework of the Yakhin Impact agritech incubator. The incubator began operating this month with four smart agriculture ventures and solutions for the wasted food problem. The ventures will spend six months in the incubator, during which they will work with various customers in the agriculture industry in order to develop solutions to current market problems.

Yakhin today announced that over the next six months, it would make investments of up to $1 million in each of the ventures in the incubator. Yakhin has already allocated money for these investments. The terms for these strategic investments will be set in separate negotiations with each of the companies in the incubator in which Yakhin decides to invest. The group plans to continue investing in companies in their later financing rounds and integrate their products in the company if the cooperation is successful.

The incubator, a joint venture of Yakhin and Tech for Good, is aimed at promoting and investing in agritech ventures complying with the UN's 17 Sustainable Development Goals (SDG), with a focus on reducing the negative environmental effect of agriculture and preventing wastage of food. The US estimates the business opportunity in solving these problems at $2.3 trillion worldwide.

The incubator's work model focuses on connecting old industrial infrastructure to the ventures' technological developments. The startups participating in the incubator will receive direct access to Yakhin's land and agricultural infrastructure for the purpose of conducting pilots and trials, agronomical assistance, financial assistance, legal assistance, etc. Many ventures in this sector have difficulty in breaking into the market and raising initial financing because they lack access to agricultural land in the early stages. Cooperation between startups and agricultural industrial companies is designed to help these solutions at the early stages.

Yakhin Impact professional director and Tech for Good founding partner Omri Boral told "Globes" that Yakhin's investment in impact ventures in the incubator is part of a general change in the attitude of large agricultural companies in recent years. "Up until now, companies focused on how to get more out of the land - what is called intensive agriculture using chemical fertilizers, pesticides, and things like that. The idea was to get more out of the land in order to make more money. People now realize that this is not sustainable. Agriculture exhausted the land and created many problems costing governments, the public, and the companies a great deal of money. Yakhin understands that the way it looks ahead to the coming years has to avoid damaging the land, the crops themselves, and us. The UN is translating this into a real business opportunity. Today, we're seeing companies more and more looking for such solutions, with startups offering such solutions."

Tech for Good says that work on the next classes in the incubator has already begun. The company says that the plan is to expand the program to include a larger number of participants and recruit international players to join Yakhin. Tech for Good's goal is rather ambitious: to increase the international share of investment in Israeli agritech ventures. "All of the players we're talking to see it as both an investment opportunity and a chance to install the technology with them," Borel says.

"The way we see it, supporting new agritech ventures by strong concerns committed to purpose can be a real step forward and open an unlimited range of opportunities for the Israeli agritech industry in the world," says Yakhin VP marketing and business development Hila Rom, referring to the company's decision to invest in the ventures. She adds, "Investment activity by the venture capital funds in the field is still on a small scale, because they are looking for more maturity that agritech entrepreneurs have great difficulty attaining, among other things due to the absence of financing options in the early stages."

Startups that have begun working in the incubator:

* WeedOUT: a biological weed killer designed to lower agricultural costs and reduce the environmental damage caused by chemical weed killers.

* Viridix: a platform designed to provide farmers with accurate and continuous information about the water potential in land in order to increase the output of agricultural land, while saving on irrigation water and fertilizers.

* Bio-Pel: a technology for slow release of etheric oils as biological pesticides for the growing, storage, and transportation stages in order to reduce food rotting after harvesting.

* Clarifruit: technology designed to discover and provide information about the ripeness and quality of agricultural produce for the purpose of optimizing pricing, inventory management, and marketing.

Published by Globes [online], Israel business news - www.globes-online.com - on May 23, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

Omri Boral Photo: Reuven Kapuchinsky
Omri Boral Photo: Reuven Kapuchinsky
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