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By Agroempresario.com
In the current landscape of European food and agriculture, “self-sufficiency” and “resiliency” have become central themes, driven by a growing sense of vulnerability. These issues are top of mind for both businesses and policymakers, especially in light of recent geopolitical and climate-related challenges. The ongoing trade tensions with the United States under President Trump’s administration, combined with the devastating climate impacts of the 2024 floods and heatwaves, have underscored the need for Europe to reevaluate its approach to food security. In response, the European Commission has advised citizens to stockpile at least 72 hours’ worth of “critical supplies,” urging preparedness for natural disasters, cyber attacks, and geopolitical crises, including potential armed conflicts within the EU.
Against this backdrop, investors in European agrifoodtech startups are becoming more selective, evaluating potential investments through the lens of resilience. While global agrifoodtech funding has seen a notable decline, there is still capital available to deploy in the sector, particularly in companies that can demonstrate the ability to contribute to Europe’s self-sufficiency and resilience in food production and distribution.
According to AgFunder’s Global AgriFoodTech Investment Report, European agrifoodtech funding dropped 29% in 2024, falling from $5.4 billion in 2023 to $3.8 billion. The number of deals also declined by 27%, from 582 in 2023 to 423 in 2024. Despite these drops, the total funding raised in 2024 remains higher than the $3.1 billion raised in 2020 and $3.5 billion raised in 2019, signaling a return to pre-Covid and pre-valuation boom levels.
When removing the UK’s contributions—around $650 million in 2024—the total European agrifoodtech funding amounts to just over $3.1 billion. This places the region in a position similar to its status in 2019, prior to the inflated valuations that characterized the market in the years following the pandemic.
While the funding environment remains challenging, some experts are optimistic about a recovery in 2025. Johan Jörgensen, founder of Sweden Foodtech, believes that the only direction for the market is upward. He compares the past few years to a period of “tidying up” following a time of excess capital and inflated valuations. Jörgensen believes that now the focus can shift from merely protecting existing investments to driving new opportunities forward.
On the other hand, Max Brandes, investment manager at Germany’s Rentenbank, suggests that the funding situation may not improve significantly in the next 12 months. He warns that valuations may continue to drop, but he also notes that there is a substantial amount of “dry powder” (capital waiting to be invested), which could positively influence the funding landscape for startups in the near future.
Jörgensen also points to the European Green Deal, which earmarks a trillion euros for environmental and sustainability projects, including those in the food sector. He argues that this significant sum of money could play a pivotal role in reshaping the agrifoodtech investment landscape in the coming years, especially as the focus shifts toward resilience.
One of the key trends emerging in the European agrifoodtech sector is a growing emphasis on “critical foodtech.” José Luis Cabañero Gutiérrez, CEO of Eatable Adventures, a Spanish investment and accelerator program, notes that there is increasing interest in technologies that ensure food security, enhance supply chain resilience, and support agricultural sustainability. These technologies address concrete market needs rather than speculative growth and are seen as essential for safeguarding Europe’s food systems in the face of geopolitical and climate risks.
This focus on resilience is reflected in the European Commission’s Vision for Agriculture and Food, published earlier this year, which outlines the need for greater self-sufficiency in food production and a reduced reliance on imports for critical goods. The EU’s growing tensions with the United States, as well as the ongoing war in Ukraine, have only added to the urgency of addressing these vulnerabilities. Ensuring food system resilience is now seen as a central priority for the EU’s agricultural and food policy.
As resilience takes center stage, several startups are emerging as leaders in the agrifoodtech sector. One such company is Finnforel, which operates a “recirculating aquaculture system” to improve the efficiency and sustainability of trout farming. The company raised $260 million in a deal with Mitsubishi and other investors, with the funds aimed at scaling its operations and expanding its “Gigafactory” concept, which brings processing and packaging onsite to reduce logistical complications and lower costs. This model not only supports local food systems but also helps reduce the company’s carbon footprint.
In the bioenergy space, Green Genius, a Lithuanian startup, secured $110 million in funding from the European Bank for Reconstruction and Development (EBRD) to support its European expansion. This funding will help the company scale its renewable energy projects, which are integral to the transition to more sustainable agricultural practices.
The eGrocery sector, which focuses on online food delivery, remains a major area of investment despite its perceived lack of emphasis on resilience. In 2024, eGrocery startups raised $792 million across 20 deals, a decrease from $1.1 billion and 42 deals in 2023. Jörgensen explains that these companies continue to attract investment because they offer predictable growth and have assets that retain value, making them more attractive to investors compared to other sectors.
Germany stands out as one of the top European countries for agrifoodtech investment, despite a 32% decline in funding in 2024. The country’s agritech industry remains strong, with startups raising $561 million in total funding last year. However, Max Brandes notes that Germany’s agrifoodtech ecosystem faces challenges related to fragmentation, with numerous universities and hubs working in isolation. This fragmented landscape makes it difficult for venture capitalists to access early-stage companies, hindering the overall growth of the sector.
Germany’s strict regulatory environment is both a challenge and an opportunity. On one hand, regulations can slow the pace of innovation, but on the other, they are driving significant advancements in areas like regenerative agriculture, animal welfare technologies, and consumer-driven product innovations. Rentenbank’s Brandes believes that Germany’s regulatory framework, combined with growing consumer demand for sustainable products, positions the country as a leader in the agrifoodtech space.
Rentenbank is actively working to address the fragmentation of the ecosystem through its Growth Alliance initiative, which supports agrifood startups by providing mentorship, access to business networks, and connections with academic institutions and government entities. This initiative is designed to foster collaboration and streamline the process for startups to access funding and scale their operations.
Looking forward, several key investment trends are shaping the European agrifoodtech landscape. According to Cabañero Gutiérrez, the most promising companies are those that directly address vulnerabilities exposed by recent global disruptions. These startups are demonstrating clear paths to profitability while focusing on food system resilience and sustainability.
One area attracting significant investment is precision agriculture, which utilizes advanced technologies to optimize resource use and adapt to changing climate conditions. Digital platforms that enhance supply chain transparency and efficiency are also gaining traction, as they offer faster paths to revenue and potential exits for investors.
Beatriz Jacoste Lozano, director of Spain’s KM Zero Food Innovation Hub, highlights the growing interest in natural ingredient alternatives and functional food ingredients. Many of these innovations are biotech-driven and focus on improving the nutritional profile of food while reducing reliance on chemicals. Other areas of focus include sugar and salt reduction, probiotics, and postbiotics.
B2B SaaS and AI applications in food are also on the rise. These technologies are being used to solve operational challenges such as supply chain optimization, food waste reduction, and carbon tracking. For investors, these startups offer quicker returns and are becoming an increasingly attractive option as the agrifoodtech sector recovers.
Finally, public funding initiatives like the European Innovation Council (EIC) are playing a critical role in supporting the scaling of agrifoodtech startups. While private capital remains cautious, these public mechanisms are helping sustain innovation in the medium term and could pave the way for renewed investment in the sector.
For private investment to fully recover, several conditions must be met, including valuation corrections, wider market adoption, and successful exits. The anticipated IPO of CookUnity, a meal delivery service, has already generated excitement in the sector. If successful, this IPO could serve as a catalyst for renewed investor interest in agrifoodtech startups.
