Ag Chat Spotlights Investing at the Intersection of Agriculture and Technology

Smart, Smaller Scale Plays Land Private Equity Fund Comfortably in the Catbird Seat

By Marc Dresner, IBC Life Sciences

Michael Curry, managing partner at Investeco Capital, has carved out a plum investment niche in Canada’s burgeoning “intelligent agriculture” market for his firm and its clients.

While big private equity funds tend to concentrate on big deals with big companies to the tune of tens of millions, Investeco frequently takes minority stakes ($2-3 million) in early-mid-stage, modest players ($7-10 million rev.) who turn a tidy profit on a promising product with substantial growth potential.

“We don’t have a lot of competition for deal flow,” Curry told Ag Chat. “There is so little capital looking into these areas in Canada that the door is open when we go to see these companies.”

“These entrepreneurs are doing very well; they’re not prepared to sell half the company at this stage,” Curry added. “We like people who think long-term and not in short cycles. These businesses have to have compelling reasons to be around for a long time.”

Investeco’s fund pours expansion capital into agricultural and environmentally sustainable interests in four main areas: water, energy, food and technology.

According to Curry, the sweet spot often rests at the intersection of agriculture and technology: GPS navigation for tractors, variable rate application for seeding and fertilizer, UV water filtration, etc.

“To grow in a sustainable, economical manner going forward, [agribusiness is] going to have to increase yields and crops. We are going to have to use less energy doing so. We are going to have to use less water,” said Curry. “So we see tremendous opportunity in the marriage of technology and agriculture production.”

In this edition of Ag Chat, we’ll also explore:


• The trend toward de-commoditized, value-add food production


• The resurgence of local, resilient supply chains


• Why Wal-Mart is now selling organic milk…

Listen to Part 1.

Listen to Part 2.

Download the transcript.

Editor’s note: Michael Curry will be featured on a distinguished panel titled “Making AG Investments Responsible for a Sustainable Future” at the AG 2.0 Global Investments Conference in Toronto, Canada November 7-8, 2011.

For more information or to register, please visit www.ibclifesciences.com/globalaginvesting

ABOUT AG CHAT
Ag Chat is an executive interview series featuring the business experts, investors and entrepreneurs at the forefront of sustainable agriculture. Each episode explores the trends, technologies and drivers shaping the world of sustainable agriculture today.

ABOUT THE AUTHOR/INTERVIEWER
Marc Dresner works closely with IBC Life Sciences as a communication lead. He is the former executive editor of Research Business Report, a confidential newsletter for the market research industry. He may be reached at mdresner@iirusa.com. Follow him @mdrezz.

Agricultural “Sustainability”: Buzzword or Metric for Investment?

AG Chat Interview Cleaves Fact From Fad in Sustainable Ag

By Marc Dresner

Question: Which one of these things is not like the other ones?

A. This summer, PepsiCo published its first sustainable agriculture brochure and subsequently announced plans for an initiative along similar lines.

BUT PepsiCo Director of Sustainable Development Dan Bena was quoted thus: “Comparatively, the environmental part is going to be easy to solve because there the technology exists to improve farming practices… The economic aspect will also be relatively easy because we already have examples of improvements we’ve made there. But the most difficult part will be tackling the social element, because there we will probably have to supersede what’s technically available locally.” (Source: eMoney Daily)

B. The USDA recently announced that in 2012 it will award grants to “farmers and ranchers with innovative ideas for improving operations through sustainable agriculture practices.” (Source: Drovers CattleNetwork)

C. Last week, former McDonald’s subsidiary Chipotle Mexican Grill in partnership with country music legend Willie Nelson released an animated short in support of sustainable agriculture suggestively titled “Back to the Start”—with Nelson covering Coldplay’s “The Scientist”—promoting free-range, “natural and organic” products. (33,000-plus views as of this post.)

Answer: D. All of the above...and....none of the above?

How is it possible that a trend the likes of sustainability, which has preoccupied climatologists, ecologists, biologists and evironmentalists, captured corporate imagination and venture capital attention, corralled the interests of regulators and politicians, alike, and attained international popular support in the hearts and even the wallets of average people, could still be subject to such a wide range of interpretation?

Clearly the concept of sustainability, while highly fashionable, isn’t as simple as it seems; it’s rife with misunderstanding and vulnerable to the whims of misguided good intention and ignorance as much as it is to profiteers and environmental poachers. (In cases, they are one and the same.)

In this edition of AG Chat, independent consultant, scientist and agribusiness expert Steve Savage dispels some common misconceptions with regard to sustainability and discusses the importance of removing uncertainty from the equation by quantifying sustainability. Getting the metrics right will be key!

Listen to this episode of Ag Chat here.

Download a transcript of our interview here.

Editor’s note: Steve Savage will be speaking on The Surprising Barriers to Agricultural Sustainability at the 2.0 Global Investments Conference taking place in Toronto, Canada, November 7-8, 2011.

For more information or to register, please visit www.ibclifesciences.com/globalaginvesting

ABOUT AG CHAT
Ag Chat is an executive interview series featuring the business experts, investors and entrepreneurs at the forefront of sustainable agriculture. Each episode explores the trends, technologies and drivers shaping the world of sustainable agriculture today.

ABOUT THE AUTHOR/INTERVIEWER
Marc Dresner works closely with IBC Life Sciences as a communication lead with a background in trade journalism and marketing. He is the former executive editor of Research Business Report, a confidential newsletter for the marketing research industry. He may be reached at mdresner@iirusa.com. Follow him @mdrezz.

Agricultural Technology Sector Primed to Explode!

AG Chat Interview Series Explores Opportunities & Investment In The Fertile Technology Bioeconomy

Some of you may recall the high-tech boom that began in the late 80s/early 90s when the IBMs, Apples, Unisys’s and Honeywells of the world unleashed a torrent of major innovation.

Well, it appears the agricultural technology sector is on a similar trajectory and may be about to break out in spectacular fashion.

According to Dave Smardon, President and CEO of Bioenterprise Corporation, ag tech is in the “embryonic” stage—teeming with innovations that may revolutionize everything from fuel to pharmaceuticals—and the venture capital community is watching closely.

In this episode of AG Chat, Smardon takes us on an in-depth tour of the burgeoning bioeconomy: Which technologies to watch? Who’s investing? Exit strategies? Deal size?

Listen to this episode of Ag Chat here.



Download a transcript of our interview here.

Editor’s note: Meet Dave Smardon and his colleagues from Bioenterprise at the Ag 2.0 Global Investments Conference taking place in Toronto, Canada, November 7-8, 2011.

For more information or to register, please visit www.ibclifesciences.com/globalaginvesting

ABOUT AG CHAT
AG Chat is an executive interview series featuring the business experts, investors and entrepreneurs at the forefront of sustainable agriculture. Each episode explores the trends, technologies and drivers shaping the world of sustainable agriculture today.

ABOUT THE AUTHOR/INTERVIEWER
Marc Dresner works closely with IBC Life Sciences as a communication lead with a background in trade journalism and marketing. He is the former executive editor of Research Business Report, a confidential newsletter for the marketing research industry. He may be reached at mdresner@iirusa.com. Follow him @mdrezz.

How To Invest In A Changing Climate—Literally

AG Chat Interview Series Talks Global Warming Investment Strategy

Climate change has long been a controversial topic, despite consensus among the overwhelming majority of the world’s climatologists that this phenomenon is genuine.

But when investors begin creating strategies around climate change forecasts, you know the verdict is definitely in.

To wit: As part of Deutsche Bank’s Climate Change Advisory service, Director and Senior Investment Analyst Bruce Kahn maintains an investment horizon of one to two decades based on anticipated global warming trends.

Bruce Kahn

In this episode of AG Chat, Kahn discusses the potential impact of climate change on global agriculture markets and what investors need to consider when entering these markets.

We’ll also look at emerging markets, consumption trends and various macroeconomic factors that have conspired to create enormous opportunities in water, food, feed and fuel.

Listen to this episode of AG Chat here.

Download a transcript of our interview here.

Editor’s note: Bruce Kahn will deliver a keynote on Day One of the Ag 2.0 Global Investments Conference taking place in Toronto, Canada, November 7th through the 8th.

For more information or to register, please visit www.ibclifesciences.com/globalaginvesting.

And be sure to tune in next week, when AG Chat features Dave Smardon, President and CEO of Bioenterprise Corporation, who takes us on an in-depth tour of the agricultural technology sector—which appears poised to break out in spectacular fashion!

ABOUT AG Chat

AG Chat is an executive interview series featuring the business experts, investors and entrepreneurs at the forefront of sustainable agriculture. Each episode explores the trends, technologies and drivers shaping the world of sustainable agriculture today.

ABOUT THE AUTHOR/INTERVIEWER
Marc Dresner works closely with IBC Life Sciences as a communication lead with a background in trade journalism and marketing. He is the former executive editor of Research Business Report, a confidential newsletter for the marketing research and consumer insights industry. He may be reached at mdresner@iirusa.com. Follow him @mdrezz.

Introducing Ag Chat Wednesdays

We're launching a new podcast interview series here at Agriculture 2.0 called Ag Chat!

We invite you to join us on Wednesdays throughout every month for podcasts featuring in-depth interviews with agribusiness experts, investors and entrepreneurs at the forefront of sustainable agriculture and the water sector, in association with our upcoming events, Agriculture 2.0 Global Investments Conference and Water 2.0 Investment Summit.

Back in March, we interviewed Ejnar Knudsen, co-portfolio manager of the Agriculture Fund at Passport Capital – one of the top hedge funds in the world, right before our Agriculture 2.0 conference in San Francisco.

Based on the success of that podcast, we've decided to launch a whole series dedicated to hearing what the experts have to say -- so stay tuned for more great interviews to take the conversation to new heights!

Since our blog is fairly new, we'd like to to kick off Ag Chat today with our first-ever podcast:

Ejnar Knudsen Talks Shop: An Ag Chat Podcast - Knudsen explains why we’re at the early stages of a massive agriculture market reset – in step with an iterative, 38-year cycle – and the impact of quantitative easing in the ag sector, as well as how a “silent tsunami” of global proportions poses new challenges and fresh opportunities to agriculture investors.

Click here to listen to the interview or download the transcript.

Valerie M. Russo is a Senior Social Media Strategist on the Ag 2.0 Global Investments and Water 2.0 Investment Summit team, with a technology, anthropology, marketing and publishing business acumen. She is a published poet and also maintains a literary blog. She may be reached at vrusso@iirusa.com. Follow her @Literanista.