In November 2022, PwC, the global professional services giant, announced the acquisition of AgTech Garage, the largest Agribusiness open innovation hub in Brazil. Founded in 2017, the innovation hub hosts more than a thousand start-ups connected to hundreds of clients in the whole agribusiness value chain. New AG International finds out more from PwC Agribusiness Leader Mauricio Moraes and José Tomé, the former CEO AgTech Garage.
Before talking about the acquisition and the opportunities that lie ahead. Perhaps we can set the scene a little. Rather than asking how AgTech Garage generates revenue, maybe PwC can give a brief outline of the business model for an innovation hub?“The business model for an innovation hub is somewhat complex, as it requires generating value for different stakeholders. For example, generating value for a start-up differs from generating value for a company, which differs from generating value for the Academy or a producer. AgTech Garage has a unique model for generating value for all stakeholders in the ecosystem, which caught our attention. The goal now is to scale and make this model more robust, adding other capabilities,” When did AgTech Garage appears on PwC’s radar as a possible collaboration partner?“The agribusiness sector has always been strategic for PwC: we have established in Brazil a Global Center of Excellence in Agribusiness (CoE) and we were already part of the ecosystem, given their relevance in innovation for the sector in Latin America,” said Maurício Moraes.
AgTech Garage has built up a strong reputation in its 5-year existence in promoting connections between participants in agribusiness.Where does this acquisition fit into the PwC business strategy?"First, it is crucial to emphasize that PwC’s global strategy (The New Equation), launched in June 2021, is built on our multidisciplinary model and focuses on generating trust and sustained outcomes for our clients, by bringing together the knowledge and experience of our professionals and the best of technology. Agtech Garage and the ecosystem links with this movement bringing Innovation and recognized knowledge and experience in agribusiness. We will be adding new professionals with differentiated skills sets and experience to our community of solvers and the whole ecosystem to provide our clients with the trust and sustained outcomes they are looking for," said Mauricio Moraes.
And what does AgTech Garage bring to PwC, and what does PwC bring to AgTech Garage?“This acquisition is an additional fundamental step for the consolidation and expansion of PwC solutions for the sector and, in connection with the CoE, increases our capability to anticipate trends, transfer knowledge to our people and our clients and solve complex problems,” said Mauricio Moraes.
“On the other hand, AgTech Garage has created an open innovation community management model that is unique and also created a strong brand, well positioned and protagonist in the Agribusiness ecosystem with high potential of scale. PwC and AgTech Garage combination adds new capabilities. Together, we will offer complete solutions to players in this sector, with unprecedented support from strategy to execution, with a lot of innovation and technology,” said José Tome.
“With the acquisition of AgTech Garage, PwC will also be the only firm in the sector to promote innovative solutions in the whole Agribusiness value chain,”, said Mauricio Moraes.
The AgTech Garage report of 2022 lists the agricultural sectors served, everything from citrus growing to soybean. Can you outline PwC's experience in the Brazilian agricultural sector? Is it more weighted to biotech? Where are the synergies with AgTech Garage?
“AgTech Garage is increasingly positioning itself as a hub with solutions that go from the field to the consumer's table. And PwC has many clients in the agribusiness chain. Looking outside the sector, there are a lot of synergies. Today, among the more than 80 corporate partners in the AgTech Garage are companies from 10 sectors of the economy, such as financial services and automotive,” according to José Tomé.
“Agribusiness is one of the most important sectors of the Brazilian economy representing approximately 26% of the Brazilian GDP. Technology and Innovation are fundamental to support our clients in the sector considering the various opportunities and challenges they face on a daily basis, one of them being to feed a world with constant change and population growth, in a sustainable way. Biotechnology, traceability, operational efficiency, data analytics, connectivity, foodtechs, agri fintechs, decarbonization, alternative proteins, energy transition, ESG, among others, are themes in the agenda of the principal decision makers in agribusiness”, according to Mauricio Moraes.
The report also lists various numbers, such as 51 employees, +200 university members connected, +70 investors, +35 international agencies. The hub has also expanded its 'campus'. Is the plan to scale up further? And if so, how do you bring scale to this business?
“Yes, AgTech Garage is expanding, and in the coming months, the Piracicaba Valley Campus in São Paulo State will double in size. This expansion is a result of our partners' demands, always looking for environments that can bring a differentiated experience. The acquisition by PwC will further accelerate the AgTech Garage's expansion in Brazil and abroad,” said José Tomé.
In the report, José Tomé of AgTech Garage talks of being able to generate value globally - is that a vision that PwC shares? Are there other regions where PwC believes such a hub would work? “PwC is a global network present in more than 150 countries and, as mentioned above, the global agribusiness CoE is located in Brazil. PwC Brasil already supports several countries in the PwC network and several multinational clients. So, Agtech Garage will undoubtedly interact with the entire PwC global network. Today, AgTech Garage is already working with international partners, even though our headquarters are in Brazil”, according to José Tomé. ●
Mauricio Moraes, PwC Agribusiness Leader
José Tomé, the former CEO AgTech Garage
