ATB Financial contributed the final dollar to the fund that has been raising since 2021.
Women-led investment firm The51 held the final close for its $51-million CAD Food and AgTech Fund after actively raising for nearly the past four years.
The Food and AgTech Fund is The51’s first sector-specific fund, and will invest in diverse founders who are transforming food and agriculture with advanced technology between the pre-seed and Series A stages.
A joint statement fromThe51and Alberta Crown corporation ATB Financial, which contributed the final dollar in the second half of 2024, said the fund close marks a significant milestone in the current challenging venture capital landscape.
“The current VC environment forces discipline.”
Alison Sunstrum
The51
“This final close empowers The51 Food and AgTech Fund to accelerate the growth of early-stage companies revolutionizing agriculture,” The51 general partner Alison Sunstrum said in a statement. “By leveraging technologies like AI, robotics, and biotechnology, these companies are poised to transform the industry.”
The51 initially announced the Food and AgTech Fund in September 2021 with hopes to raise between $25 and $30 million, but expanded to a $50-million target after receiving more soft commitments and investor interest in 2022.
The firn went on to secure $30 million of its $50-million target in April 2023, supported by lead investor Farm Credit Canada, with limited partners (LPs) including Alberta Enterprise Corporation, National Bank of Canada, family foundations and offices, and several undisclosed individual accredited investors from agribusiness, farming, and industry backgrounds.
RELATED: The51 closes $30 million of targeted $50-million Food and AgTech Fund
Realize Capital Partners, Boann Social Impact, and the Government of Canada’s renewed Venture Capital Catalyst Initiative inclusive growth stream have also backed the fund.
Sunstrum told BetaKit in April 2023 that, while the group was initially optimistic, they saw a shifting climate and a withdrawal of LP investors when they tried for an earlier close in 2022. The51 also told BetaKit at the time that it hoped to fully close the fund in June 2023.
In an email statement to BetaKit following the fund’s final close, Sunstrum said they did not know how tough things would get as they sought to close the fund. She explained that Agtech venture capital investment faced significant challenges in the latter half of 2023 and into 2024 that was characterized by sector-wide valuation corrections, which reflects trends of tightened access to capital.
“The current VC environment forces discipline,” Sunstrum said. “We honed our thesis and doubled down, building our team, advisory bench, created a new AgTech focused management entity and expanded our reach with offices in Calgary, Vancouver and Toronto.”
Sunstrum added that they observed a significant increase in deal flow through the last half of 2024, and that founders with “substantial potential” have been adjusting their valuation expectations to more realistic levels.
“This trend reflects a broader market correction, we are prioritizing companies that demonstrate clear paths to scalability and profitability.”
Sunstrum toldBetaKit that The51 anticipates investments from the Food and AgTech Fund to range from $350,000 to $2 million per startup. The fund has already invested in six companies to date, including Erthos, ArkeaBio, and Synergia Biotech.
UPDATE (1/17/2025): This story has been updated with commentary from The51 general partner Alison Sunstrum.
Feature image courtesy The51.
