Lever VC is full-steam ahead with its agtech investment strategy, as the firm hunts for innovative startups for its Fund II roster, Nick Cooney, the firm’s managing partner, shared during the Future Food-Tech event in Chicago this week.
Started in 2018, Lever VC invests in ag and food tech startups that are creating a more sustainable — and often healthier — food system, Cooney explained. The venture capital (VC) firm is rounding the corner on its eighth investment as part of its Fund II, which will likely be in agtech, he noted.
Lever VC started deploying capital from its $50 million Fund II last year, including investment in digital livestock companies HerdDogg and Flox.
HerdDogg and Flox “are good examples of software inputs and monitoring software that has direct short-term ROI for producers — less [animal] mortality, less disease, some efficiencies, production improvement and some site reduction in labor needs,” Cooney explained.
The companies boast “lower the mortality rates, lower the loss rates, and that means fewer animals need to be raised to produce the same amount of product at the day. And there you get some nice emissions reduction benefits,” he added.
Despite VC firms pulling back on agtech, innovative startups are finding a path forward, especially for those tackling market whitespace, Cooney explained. Lever VC is watching several agtech spaces closely, including seed genetics, biologics, digital crop production platforms and advancements in processing machinery, Cooney added.
“Now is not the easiest time to find funding, but there are so many whitespace opportunities in agtech ─ many more than food tech,” he emphasized.
“There is no company that we have invested in where there is some significant impact from Trump administration policies.”
Nick Cooney, managing partner at Lever VC
What impact will volatility have on investing strategies?
Lever VC’s portfolio companies are geographically dispersed, with a third of the companies residing in the US, a third in Europe and the remaining around the world, diversifying investment exposure risks associated with the Trump administration’s trade policies.
“There is no company that we have invested in where there is some significant impact from Trump administration policies,” Cooney said.
However, Lever VC investment thesis has changed “a little bit,” given the volatility and uncertainty, Cooney explained. For instance, the firm is not likely to invest in China, given the market conditions and macroeconomic trends, he added.
“In Fund I, we have two companies based in China. I think it is extremely unlikely we will have any companies from China in Fund II. There are other reasons for that as well — the general macroeconomic situation there, the funding situation within China, but also the trade situation ... that also makes it a lot harder,” he elaborated.
