Europe may not boast its own Silicon Valley – yet – but the continent’s tech sector is booming, thanks to a perfect storm of creative entrepreneurs coupled with a surge in funding opportunities. In fact, 2017 saw fundraising by European tech companies reach a record high, according to leading tech advisory and investment firm, GP Bullhound.
And while European startups still trail their Asian and American counterparts by a significant margin, their growth is picking up at an impressive pace: GP Bullhound’s report shows that 14 new billion-dollar tech unicorns have emerged in the last year, with so-called ‘mega rounds’ of funding – netting more than $200m – an instrumental part of this upswing.
This increased investment is likely to have far-reaching results. Half of the 50 tech businesses identified by Bullhound as candidates for European titan ($50bn+) status are in the SaaS, fintech and transportation sectors. These industries’ innovations are, in turn, already transforming other industries, including agriculture, a sector which is the principal source of income for roughly 20% of the EU’s population. In fact, as big data and digitalization begin to jumpstart the precision agriculture movement, Europe is on a path to becoming a leading agri-tech hub.
Creating a European startup culture
Providing startups with a fertile environment to grow is key to their success. Tech companies need access not only to an imaginative research base, but additionally to talented staff, an abundance of investment capital and an existing tech ecosystem within which to incubate and expand their ideas. Europe has no shortage of skilled workers but has historically suffered from a funding shortfall and a lack of established tech corporations – mainly because of the continent’s reliance on traditional industries.
Nevertheless, tech businesses are beginning to benefit from Europe’s increasingly welcoming growth conditions. Not only is the continent home to many of the world’s best computer science universities, but it also enjoys generally lower living costs for residents than other tech-heavy regions, which draws in entrepreneurs and helps them attract top engineering talent from all over the world.
American startups may well command higher valuations – around five times greater than those in Europe – but they also carry inflated costs due to the escalating real estate prices in tech hotspots like Silicon Valley, which make it tough to hire staff without forking over sky-high salaries. The prospect of generating faster profits is one reason that American venture capital is being diverted into European tech startups. As a region, Europe had the most initial public offerings (IPOs) in 2017, while its tech companies are consistently outpacing the eurozone’s average GDP.
The rise of precision agriculture
Europe’s digital transformation is gathering particular momentum in the agricultural sector, where data and analytics systems are being used to improve farming processes across the globe. Precision agriculture is a revolutionary approach designed to optimize agricultural output while minimizing the use of valuable resources such as water, energy, fertilizers and pesticides.
Traditional farming methods are inherently wasteful: agricultural inefficiencies are responsible for more than eight percent of the world’s greenhouse gas emissions. Precision agriculture methods use a combination of technologies, including sensors, satellite navigation and the Internet of Things (IoT) to help farmers and growers manage their land, crops and animals more efficiently and sustainably. For instance, delivering the right amount of feed to each animal in a herd or adapting a farm’s fertilizing strategy to suit the particular conditions of any given field will not only cut costs, but could result in higher-quality produce and help to reduce environmental impact.
According to a McKinsey report, about a third of food produced globally is lost or wasted each year –burning $940 billion and tragically failing the almost 800 million people globally who are severely malnourished. Precision agriculture offers farmers the possibility of gleaning higher yields from existing fields, while reducing the use of agrochemicals and causing fewer environmental repercussions than traditional methods of farming.
Leading the way in agri-tech
Precision agriculture offers Europe an excellent opportunity to link its increasingly imaginative startup ecosystem with the demand for innovation in the agriculture and food industries. This synergy will be at the top of the agenda next month at the World Agri-Tech Innovation Summit in London, where startups are set to present their agricultural innovations over the course of the two-day event.
Registered attendees include Norway’s Soil Steam International which is working on providing an alternative to pesticides by using steam to kill weeds, fungus and pathogens. The company claims this technology could boost berry, fruit and vegetable harvests by up to 40 percent, while increasing the length of time the produce can be stored and reducing waste overall. French startup Hi-phen is expected to highlight their system of sensors coupled with a tech platform to observe crops and optimize their harvesting operations, while Saga Robotics, out of Oslo, will showcase Thorvald, an agricultural robot which uses UV light to fight strawberry mildew.
The practical benefits of tech investment
There’s little doubt that the market for the type of precision agriculture tools which will be on display at the London summit is surging. In many ways, precision agriculture is the perfect real-world application of cutting-edge tech. By aligning new technological developments with existing equipment such as tractors, trucks and drones, farmers can more accurately analyse their processes and use the data to monitor growth, optimize production and prevent spoilage as products move more efficiently through the supply chain.
With European tech industries thriving as never before, the continent’s agri-tech innovators have the chance to take up the gauntlet and lead the global field in shaping 21st century agriculture.