“We find that the 10-15 per cent range is a sweet spot where we have enough skin in the game that is worthwhile bringing the full weight of GrainCorp to help them out,” said Graincorp’s head of innovation and growth,Jesse Scott,who is leading Ventures.
The ASX giant initially considered 40 to 50 start-ups,which has since been narrowed down to a “shortlist of an undisclosed number” that the company is now performing due diligence on.
“We[have] a pipeline moving as we speak,” Scott said. “My hope is that we are able to announce our first deals within the next couple of months.”
GrainCorp has taken a keen interest in four specific themes:analytics and optimisation;smarter supply chains;biotechnology;and sustainability. The company is looking for solutions that will help digitise manual processes,improve efficiency,boost crop production and provide live data on grain quality and quantity,for instance.
Both Scott and Spurway pointed to Hone (a handheld device that measures moisture and protein levels in wheat) and CropConnect (an online marketplace that connects growers and buyers) as examples of the kinds of technology it seeks to invest in. GrainCorp acquired a 15 per cent stake in Hone for $5.2 million in October last year,while CropConnect is developed by GrainCorp.
However,Spurway indicated that the fund would not get in the way of future acquisitions. “If we see a really compelling opportunity outside of the venture capital fund that makes sense for more direct intervention by GrainCorp,of course we’ve got the opportunity to do that.”
The agribusiness giant is also hoping that working more closely with start-ups will see it absorb some of their energetic and agile culture. An analyst in Scott’s team recently undertook a 12-week secondment,embedding himself in a start-up to assist with their strategy.
Loading
“He comes back to our organisation not only happier,more energised,but having thought differently about the way that we approach our problems,” Scott said. “Maybe we should do it a bit more like a start-up does it.”
“A corporate environment like ours ... has a tendency to maybe fall into traditional ways of working – to occasionally get to just dip our toes in this start-up environment is so good.”