Source: Crunchbase News

Building a safe food supply chain from farm to table–that consumers also trust–is a challenge that startups are taking on.

Experts told Crunchbase News that a sustainable food supply chain begins with the farmers, who are utilizing technologies, innovated by startups, to ensure their crops have a good start.

That can include planting the right seeds, using the right field, improving growing conditions, and harvesting and post-harvest practices. Then there is the trip to the grocery store or to the manufacturing plant where the crops become something else.

Among the factors affecting the food supply chain is manufacturers’ dependence on it, said Adam Wolf, co-founder of Arable. The San Francisco-based agricultural business intelligence tool performs in-field measurements and, as part of its offerings, tells farmers when crops are in need of water or nutrients.

He points to the example of Swedish oat milk-maker Oatly running out of supply in 2018.

“At one point, you couldn’t buy oats because they ran out,” Wolf said. “Manufacturers in niche areas like this are super small, but profitable. Where it goes wrong is when you want to double in size, but you have suddenly outstripped the supply chain. That, in turn, pushes things to farmers.”

Innovation on the farm

And that’s when farmers look to innovation. In the past five years, startups have increasingly turned their attention to the farm, and investors are following their lead. So far in 2020, investors have sunk $4.1 billion of venture-backed dollars into 413 agriculture technology deals, and over the last five years have made $17.7 billion in investments, according to Crunchbase data.

Among those 413 deals in 2020 are ThinkIQ and TeleSense, which each received funding last week.

Finistere Ventures co-founder and Partner Spencer Maughan led TeleSense’s $10.2 million Series B round of financing. The firm has been investing in the food supply chain since it was founded in 2005.

Maughan said the supply chain “has been fragile with COVID and changing consumer preferences,” as well as managing waste and quality.

That’s where TeleSense is focusing. The Sunnyvale, California-based company is using remote sensors to digitize the post-harvest grain supply chain. Once harvested, grain is good for about six to eight months, so it’s important for farmers to know the status of their harvest across all of their silos, TeleSense CEO Naeem Zafar told Crunchbase News.

Meanwhile, ThinkIQ, an Aliso Viejo, California-based company working on digital manufacturing transformation SaaS, raised $11.6 million in a Series A round led by Ecosystem Integrity Fund.

ThinkIQ also uses sensors, but to trace the manufacturing process in real time from raw materials to a finished product, said Doug Lawson, CEO of ThinkIQ, in an interview.

The data collected provides farmers with information to make smarter decisions about how crops are grown, transported and purchased. In some cases, ThinkIQ was able to boost yield from 50 percent to more than 90 percent without physically changing the growing process, he said.

For example, data led to a whole new type of gluten-free oats being grown. By following certain growth practices to deliver to the manufacturer, Lawson said it yielded a $30 million benefit to farmers per year.

“That is the power of information,” he added. “The adjustments the farmers needed to do were worthwhile and easy to do. Data dramatically improves economics and could even prevent recalls or detect them quickly. That has a huge impact and makes for a safer product.”