Company Interview / AgTech and the path to feeding the future

Key points:

Australian agritech market offers exciting investment prospects focusing on food and sustainability.Investments in innovative tech such as Embryo for cattle cloning and Crop Ify for grain classification.Emerging tech in restaurant management and milk pasteurisation adds efficiency and global market potential.

Mark Gustowski of Mandalay Venture Partners states that the Australian agritech market presents thrilling investment opportunities. He highlights contributions of Aussie food exports feeding over 70 million people globally, with a keen focus on investments at the intersection of food and sustainability.

Mark mentions notable investments in Queensland-based Embryo, which focuses on converting embryo cloning tech into superior cattle herds, and a South Australian company, Crop Ify, using AI to classify grains swiftly. These innovations contribute significantly to efficiency and productivity in the agriculture sector.

Opportunities in the restaurant sector are also emerging, with investments in software like Restock helping to manage food waste and inventory. Technologies like Niteroi's pressurised pasteurisation of milk extend shelf life, supporting Australia's potential as the food bowl of Southeast Asia.

Full unedited transcript below:

0:00

Well, let's turn to the agritech sector. Are there any exciting opportunities in the space that investors should be looking out for? Mark Gustafson, managing partner at Mandalay Venture Partners, joins me now for more. Hi, Mark. Thanks for joining us. Buyers. What are you seeing here?

0:15

Oh my pleasure is lovely. Lovely to chat. Uh, the Australian agritech market is very, very exciting at the moment. And, um, I think some of the statistics that came out recently from the CSIRO indicate that Australian food exports feed over 70 million people globally. And so it's our aim to actually start to invest in great ag tech companies that can continue to do that at the intersection of food and sustainability. So what are some of these opportunities that you're looking for or looking at I should say.

0:42

So what we're seeing at the moment is a lot of interesting opportunities that sit on farm with on farm efficiencies, farm management systems and software. We're seeing a lot of technology opportunities that are in supply chain logistics, whether that be provenance and traceability, which is actually working out and finding out where your food comes from and what it's been through, right through to the SAS and where you're seeing restaurant Copilot software supporting people that have restaurants with food management, food waste inventory management across that whole gamut. There's very exciting opportunities in the Agtech sector. Okay. And obviously a lot of opportunity that hasn't been tapped in yet. Let's just talk a little bit about some of the transformative technologies that you're seeing here.

1:20

So in Australia, we're seeing a lot of things in the cattle industry at the moment, most recently an investment we've made in a Queensland based company called embryo that's developed some technology around cloning of embryos to actually provide and create superior and efficient herds of cattle. Very, very exciting company. And also recently received Bill and Melinda Gates Foundation funding to support that from cattle herds that might be in Sri Lanka for four cows right through to 4 or 5000 cows in in the US or Texas. So increasing the sufficient the efficiency and the sustainability of cattle herds. Uh, very, very interesting. We've also invested recently in a company that is a SAS product, uh, right at right at the consumer ended products called restock that manages restaurant software, restaurant co piloting and food systems and so can actually help reduce the food costs while providing dynamic pricing for food, which is always something that restaurateurs are interested in. And how could that actually transform the overall food ball bowl? Excuse me, as you call it, given that, um, you know, this could provide a

2:20

lot more export opportunities to.

2:23

Well, Australia is supremely positioned to be the food bowl of Southeast Asia. And even today, we're on a call with some colleagues in Japan. And most of the region across the across Asean and East Asia looks to Australia for clean food, clean food technologies and food systems. And I think we're in a position now where getting some more investment into the Agtech and the food tech category can really start to bring Australia as a as a world and certainly as a regional leader in the foods in the food sector where we're seeing across, whether it be fresh food, whether it be cattle produce or, um, or horticulture, that we have enormous and incredible technologies. Uh, we've recently invested also in a company in South Australia called Crop Ify that uses artificial intelligence, machine learning, to to classify grains along the supply chain. Normally, classifying grains is done by humans and can take anywhere between 15 and 20 minutes to actually classify and check whether they're impurities. The software that they've got actually can do the same thing in about 90s. And so we're seeing real efficiencies and really interesting technologies coming

3:23

out of Australia, um, at the moment that are, that are relevant for all over the world. And how can they sort of transform their process as well? Because I'm just looking at some of the methods that can increase the shelf life of fresh milk, and then that opens up a lot of other market opportunities as well. Niteroi, which you mentioned, is an amazing company also based in Queensland that has a type of, um, pressurized pasteurization technology that can extend the shelf life of fresh milk from 21 days to 60 days. Actually, a number of my colleagues and I have had it for a lot longer than that, and it's fantastic. It also, um, allows for fresh milk to then be to be shipped and supplied around the world, which we're not necessarily seeing a huge amount of at the moment, hugely important for the Asean region and the Asian region. Again, it also supports these sorts of technologies, can also increase the digestibility in the bioavailability of milk. And so where we see these emerging economies across Southeast Asia requiring more proteins, more food, more fibre, these sorts of technologies like Nuro and others can start to serve the purposes of those emerging

4:22

economies. So these companies have mentioned that they're very happy to have your investment and milestone. In fact, Noboru says for the company, just tell us at Mandalay Venture Partners, I guess the confidence you have in what you're investing in.

4:37

Yeah, we're really excited about what we're investing in. Across all of Australia, there's about less than 2% of total venture capital that goes into the Agtech and the food tech sector. What that's meant is that there's an enormous pent up demand for opportunities seeking great, great investment that can provide great capital returns as well. And so we have we have probably 3 or 400 companies on the books that we're looking at at the moment. We've made seven investments to date, but everything that sits from on, as I mentioned, on farm through the supply chain, right through to the point of sale, end of software. And Australia has really great expertise in all of those areas. What we need to get to, to get our companies moving forward is a little bit more capital and support moving into those new markets, and so that's something that we're very, very focused on. And how are you hoping to achieve that Mark? So Mandalay to date has raised around about $30 million. And we're investing between 150 and 1.2 million in each of the companies we invest in. We're actually on target to try and raise $50 million by the end of the year. That should let us invest in around about 20 to 25 agtech

5:36

and food tech startups over the next three years. Uh, from that point on, we'll be working with our investment partners and our global partners to take those companies into into new markets and really put a footprint for Australian ag and food tech across the world.