Opinion: Startups and the fragile link in the technological evolution ecosystem before the farm gate.

The Radar Agtech Summit 2026, held on March 24th, marked the launch of another edition of the Radar Agtech Brasil, a publication that measures the maturation of the Brazilian agricultural innovation ecosystem. The annual report mapped 2.075 startups focused on agribusiness in Brazil, a 5,22% increase in the last year, but modest compared to the average growth of 11,8% per year since the beginning of the historical series in 2019.

The structural distribution of the startup ecosystem reveals a bottleneck in the country's competitiveness. While approximately 41% of agtech companies operate "within the farm gate" (management systems, data integration, drones) and another 41% focus "after the farm gate" (food, marketplaces, sustainability solutions), only 18% operate "before the farm gate," in the fundamentals of agricultural production, such as genetics, biotechnology, fertilizers, and financial services. Brazil has built digital infrastructure to manage farms and distribute production, but has not developed companies within this ecosystem focused on the chemistry and biology embedded in the soil, lacking incubators and specialized laboratories. We have digitized the surface, but outsourced the root.

The direct consequence of this technological asymmetry is yet another geopolitical risk. The scale of agricultural production ensures cost dilution, and Brazilian tropical farming techniques, combined with an extremely favorable climate, are factors that position Brazil among the global leaders in terms of productivity and export of agribusiness products. However, the structural dependence on imported inputs, as well as foreign biotechnologies and patents, weakens operations. In a global market driven by protectionism, especially marked by sustainability agendas, it is not difficult to imagine how much this dependence can represent a risk factor. The underutilization of national research potential translates into profit margins transferred abroad.

To protect the sector, it is imperative to move beyond trendy terms and focus on science, research, and development, which truly drive progress in resolving agribusiness bottlenecks. However, deep tech companies face considerably higher barriers to market entry than software startups because they encounter capital-intensive business models.

Deep tech startups, focused on complex technological research and innovations such as biotechnology, nanotechnology, and new materials, require laboratory infrastructure, prototyping, and long maturation cycles to begin operations and achieve scale in the field. Conversely, the venture capital ecosystem's preference for Software-as-a-Service solutions reveals an allocative bias, where the liquidity and low cost of this saturated market are profoundly out of sync with the development timeline of biological science. This dissonance penalizes innovation even before the commercial phase. Applied science demands patient capital, not the expectation of accelerated returns from digital products.

The current credit and subsidy landscape exacerbates the sector's isolation. The report indicates that 69,3% of agtech companies primarily use bootstrapping (capital from founders and family members) as their strategy, while only 15,3% access traditional credit, with more than half ignoring public funding, which is mostly offered through non-reimbursable instruments. Accessing state funds requires a level of bureaucratic process that hinders the operation of nascent companies, while private credit demands real guarantees that innovators lack. The risk of technological development is entirely transferred to the individual. The financial structure punishes innovation.

In this environment, aligning capital infrastructure with the reality of both producers and entrepreneurs requires new private arrangements. Investment funds can participate in the design of more fluid capitalization structures, creating support mechanisms that directly address the risk profile and maturity of emerging companies, while startups must consolidate corporate governance to unlock these flows. Brazil has already proven its capacity to scale food production globally. Agribusiness has learned to finance its own harvest, but who will finance new patents?

About the author:

Renato Laffranchi Falcao is part of the Insper Agro Global research team. A Computer Engineer from Insper, he has experience in data analysis and the development of solutions focused on automation and Artificial Intelligence, and contributes to the preparation of studies on foreign trade and trade policies, focusing on the implementation of innovative technologies that boost the efficiency of research in Brazilian agribusiness.

*The text above is the responsibility of the author and does not necessarily reflect the opinion of Insper Agro Global.

References

SAKUDA, Luiz Ojima; FAVARIN, Aurélio Martins; JÁBALI, Pedro Prudente Corrêa (Eds.). Radar Agtech Brasil 2025: Mapping of Startups, Innovation Environments and Investors in the Brazilian Agro Ecosystem. Brasília and São Paulo: Embrapa, SP Ventures and Homo Ludens, 2026. Available at: https://radaragtech.com.br