Science, innovation, entrepreneurs and risk capital produced a Covid-19 vaccine in record time. It will be what ultimately gets our nation back to work, back to school and back to our normal lives.
From my purview as the Chief Investment Officer at S2G Ventures, one of the most active investors in food and agtech, I believe science and innovation can also solve the next challenges looming ahead of us: climate change and a public health crisis. Science is transforming the computation, biology, physics and chemistry of food production – helping design a system that is healthier and more sustainable for consumers and more profitable for farmers.
As a new Congress and Administration begin, the nation has an opportunity to rethink where we invest our resources and how smart policymaking can ensure that innovations can be fully utilized. We have released a proposal that charts a path that policymakers can follow to avoid the issues that arise when policy lags behind food and ag tech investment and innovation.
We need to organize action around three pillars: rural renaissance, nutrition as national security and resilient supply chains.
Let’s start with rural renaissance. As a nation, we have a broadband connectivity problem. We must invest in increased incentives and improved mapping to connect communities to the digital economy.
Beyond the needs for students and in healthcare, broadband access enables precision agriculture, which can give farmers more control over their environmental footprint. Precision agriculture helps to build healthy soils, which in turn, sequester carbon. These benefits can improve farmer bottom lines and their environmental impact. Connectivity and the software tools that power big data provide farmers access to lower costs of capital from lenders who will be demanding this transparency and carbon accounting. Connectivity allows farmers to better leverage a commodity they’ve invested in – soil – and support environmental gains for the long term.
Over time, these factors support a focus on profitability per acre, rather than yield. Emphasizing margin instead of revenue allows farmers more space to focus on better soil health and climate outcomes.
The private sector is moving quickly to build financial, digital and precision technologies to support this shift. Government should invest in making it easier for farmers to utilize new forms of capital and to practice conservation. We support the establishment of a climate task force at the USDA that includes input from private sector partners, including venture capital and start-ups.
Next is nutrition as national security, or my preferred vision of affordable healthcare and healthier food as an extension of the Hippocratic Oath.
There is growing interest in the role of food in managing and preventing chronic health conditions. At the same time, consumer preferences are increasingly uncompromising around nutrition, price and flavor.
Historically, breeding focused on input traits, like making a crop more resilient to drought or pests. The private sector is now unlocking technologies that enable the next generation of breeding focused on output traits: nutrition, flavor, functionality and affordability.
Here, too, there is significant opportunity to promote policies that support the use of food as a preventive treatment and as a means of lowering healthcare costs. The private sector is investing significantly in this area, but we need policymakers to reprioritize investments in government research. Enhanced coordination between federal nutrition research agencies and renewing a priority for nutrition at USDA’s competitive research arm, the Agriculture and Food Research Initiative, would signal the importance of this work. And the U.S. regulatory system should not impede investment in and development of technologies such as gene editing.
Finally, resilient supply chains. Food and agriculture companies had already begun rethinking their supply chains, but the pandemic has highlighted pressure points in our food production system, stressing logistics networks and reinforcing the importance of labor.
One opportunity lies in repurposing commercial real estate for controlled environment agriculture. This in turn will promote jobs in urban areas, redefine “local” food systems and optimize resource efficiencies.
Creative approaches that leverage private market participants and government bodies can help manage infrastructure costs and deliver value. Policymakers should also continue to increase incentives for local and regional producers.
The solutions I’ve outlined are ambitious and wide ranging. The moment calls for it. Rarely in the history of our nation have we faced pressure – and opportunity – of this magnitude. I believe bold action is necessary if we are to build back industries and an economy that are better, stronger, more durable and more focused on health and sustainability.
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Sanjeev Krishnan is the Chief Investment Officer and a managing director at S2G Ventures, and has been with the firm since its inception. He has nearly 20 years of experience in sourcing, executing, managing and exiting venture and private equity investments, including a focus in agriculture and food companies.