Global agrifood impact investor Astanor Ventures has announced the close of its second venture fund at €360 million.
- Astanor reaches close on its second venture fund at €360 million.
- The close of this second venture fund means the firm now has €800 million in assets under management, and underscores rapidly growing appetite in the agrifood sector.
- To remain on a 1.5˚ C pathway, agriculture will have to cut its overall emissions from 14.4 metric gigatons (Gt) of CO₂ equivalent (CO₂e) to 3.1 Gt CO₂e by 2050—almost 80%. That requires innovation and massive shifts to operations if it is to be achieved.
In a statement the company said: “This milestone achievement underscores Astanor’s unwavering dedication to fostering transformative change in agrifood, solidifying its position as agrifood specialist and forward-thinking player in the investment landscape.”
This latest closing tops Astanor’s existing various funds and special purpose vehicles altogether amounting to circa €800 million assets under management. Over the last six years, Astanor has gone from launching its first fund to building a firm backed by long-term investors with whom the team has built collaborative relationships.
Biotech and agrifood sector is bucking overall investment trends
The company says that the continuous engagement of large family offices and institutional ‘repeat’ investors demonstrates Astanor’s success in scaling its firm and its resilience in a turbulent economy.
This proves that despite fluctuating market trends, the sectors of agrifood tech and bioeconomy at large remain intrinsically captivating and ripe for innovation, especially with the renewed global attention on the climate crisis and an increased demand for sustainable options. Astanor’s decision to raise its second venture fund at this juncture is a testament to the company’s ability to seize opportune moments for investors, maximizing returns while contributing to material impact creation.
There are many challenges in investment in agriculture
Agriculture contributes over 8% of global emissions, but conversion of land for agriculture combined with methane emissions from livestock and agricultural energy use cumulatively account for 74% of all agricultural emissions. There are major barriers to change, including transition financing, investment to reduce costs, the need for behavioural change, and possibly additional incentives such as increased carbon prices are needed to support adoption.
Mckinsey’s June 2023 report Sustainability in Agriculture warned that while many opportunities are viable today, incentives, likely in the form of carbon prices or other financing, may need to reach $150/ton to unlock many more.
Moreover, barriers in carbon markets and financing remain for those that are viable. For example, only 1% of all carbon credits are issued through agriculture, and private investment in sustainable agricultural technology fell significantly last year – and 50% of US farmers cite low return on investment (ROI) as a top reason for not participating in carbon programmes.
Where some of the most interesting potential lies is in early stage innovative companies, that are using new breakthroughs in technology to disrupt the sector. Building upon the success of its first venture fund, Astanor says it remains committed to its core investment strategy of supporting early-stage and mission-driven companies that have identified a social or environmental issue and have developed a nature positive solution to resolve it.