What do Silicon Valley and agriculture have in common? Not much, you may think… but agriculture and technology are becoming increasingly intertwined. Tech companies see financial opportunities in agricultural pursuits, farmers see potential cost savings and higher yields through technological improvements, and perhaps world hunger may be reduced as a result.
The tech industry is aiming to feed everyone on the planet by 2100 – an estimated 10 billion people by that time – all while keeping Earth from harm and making money in the process.
While it is easy to dismiss this as altruistic rhetoric, Silicon Valley is backing up its words with actions. Tech investments in agriculture have annually increased by a 63% average over the last five years, and in the third quarter of 2014, investors poured $269 million into the field (pun intended). According to the Cleantech group, this $269 million was spread over 41 food- and agricultural-based startup companies.
Why are agriculture and technology merging so rapidly?
- Profits – Opportunities to improve yields and efficiency are opportunities to make money, regardless of the industry involved.
Sensors and data processing systems can help farmers use fertilizer and water more efficiently. Automated lettuce trimmers armed with digital imaging capability are a hundredfold faster than humans and improve yield by 10%. There are many examples throughout the food chain, from utilization of farmland to final distribution.
- New Food Sources – If you don’t want to eat ‘em, beat ‘em. Several startups are looking for plant-based, economical substitutes for staples such as meat, eggs, and dairy products that reduce the need for livestock. Others are looking at genetically designed foods or cultured meats grown separately from living animals.
- Diversification – During the Great Recession, California’s economy took a massive hit but the agricultural industry stayed relatively healthy. Investors are beginning to look at agriculture as a form of diversification as well as opportunity. Agriculture is cyclical, but for the most part, it does not correlate with the stock market.
Money is an important factor, but others are motivated by a sincere desire to improve our food supply and end world hunger. The prospect of doing societal good while making money makes ag/tech ventures increasingly popular.
While the marriage of agriculture and technology shows great promise, agricultural innovations are not without their downsides.
- Job Losses – As with most technical innovations, jobs are lost as machines take over more of the work. A few higher paying jobs are likely to displace a large number of lower-paying ones, and not all of those are migrant field workers.
- Corporate Takeover – Another risk is squeezing out smaller family farms that cannot compete with corporate interests that have the capital to invest in newer technologies and a buffer of cash to deal with drought years. Family farms may be forced to sell out, join a corporate structure, or move to a farming niche where their higher costs may be offset.
- Genetic Concerns – When thinking about technology and agriculture, some people bring up genetically modified organisms (GMOs) and so-called “Frankenfoods”. There is an automatic assumption among some that GMOs are bad, and “natural” products are good. In fact, GMOs have made great progress in improving agriculture – but there is always the chance that GMOs can go awry on a large scale.
Despite possible drawbacks, agricultural technologies are likely to continue to improve farming efficiency and produce more food to feed our hungry planet. Solving world hunger may be more of a matter of distribution and logistics, where Silicon Valley may also help; and geopolitics, where Silicon Valley skills are less useful.