Target Information

The Belgian impact fund Newtree Impact has recently made its 14th investment by contributing $825,000 to CropX Technologies, an Israeli scale-up dedicated to promoting sustainable and connected agriculture through innovative digital solutions. This financing round, which began in April 2023, concluded with a total raise of $30 million, with another Belgian venture capital investor, Aliaxis, leading the funding initiative.

Founded in 2013 in New Zealand and relocated to Israel in 2017, CropX technologies focuses on precision agriculture, aiming to make farming practices both profitable and sustainable. The company has successfully developed a system that integrates sensors located in the fields, measuring various parameters such as soil temperature, moisture, and electrical conductivity. This data is then relayed to its software platform via the cloud, allowing farmers to monitor their soil conditions continuously and make informed decisions regarding the application of fertilizers and irrigation.

Industry Overview in Israel

Israel has emerged as a leader in agricultural technology due to its unique climatic conditions and limited arable land, driving the need for innovative agricultural solutions. The agriculture technology sector, often referred to as AgTech, has attracted substantial investment in recent years, bolstered by government initiatives and collaborations between academic institutions and private companies. This ecosystem has fostered a thriving environment for startups aimed at improving productivity and sustainability in agriculture.

The demand for sustainable agricultural practices is increasingly urgent, with global concerns around food security and climate change. Israeli AgTech startups, such as CropX, address these issues head-on by offering precise and efficient farming solutions that can significantly reduce water and chemical input usage. The proactive approach of Israeli companies in leveraging technology to combat agricultural challenges positions them favorably in the global market.

In addition, as global agricultural markets experience heightened scrutiny regarding their environmental impact, companies like CropX are well-positioned for growth. With a growing portfolio of clients—currently numbering around 2,000 across 60 countries, including a base in the Netherlands since the acquisition of Dacom Farm Intelligence in 2021—CropX exemplifies the potential of AgTech in meeting the urgent sustainability demands of modern agriculture.

Rationale Behind the Deal

The partnership between Newtree Impact and CropX Technologies aligns with both parties' commitment to promoting sustainable agricultural practices. Newtree Impact's investment is driven by the promising results CropX has achieved with its technology, which can yield up to 50% savings in water usage and around 20% reductions in input costs while simultaneously increasing agricultural output by 20%. This demonstrates the potential for CropX's innovations to significantly enhance resource efficiency in farming.

Furthermore, by integrating CropX's data-driven solutions, farmers can better manage their resources and reduce their environmental footprint, which is essential in an era where sustainability is at the forefront of agricultural development.

Investor Information

Newtree Impact, established in 2021, has transitioned into an impact investment fund focused on funding initiatives that prioritize sustainability and social responsibility. The fund has successfully raised €12 million to date, completing a total of 14 investments aimed at promoting a greener economy. Newtree Impact is committed to aligning its investment strategies with the urgent need for climate action, focusing on ventures that share similar values.

Benoît de Bruyn, the CEO of Newtree Impact, emphasizes that their growth trajectory is steady and sustainable, allowing them to participate in impactful funding rounds alongside major players in the sector. This commitment to responsible investing positions Newtree Impact as a key player in the sustainability-focused financial landscape.

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The investment by Newtree Impact in CropX Technologies appears to be a strategically sound decision, considering the rising demand for sustainable agricultural technologies worldwide. The alignment of Newtree's sustainability goals with CropX's innovative solutions positions it favorably within a rapidly evolving sector. The potential for CropX to deliver substantial cost savings and improve yields further strengthens the case for this investment.

Additionally, CropX's expanding global client base and its established presence in multiple countries indicate a strong growth trajectory. The company's proven ability to develop effective precision agriculture tools aligns well with the increasing pressure on the agricultural sector to enhance efficiency while minimizing environmental impact.

The proactive engagement of Newtree Impact in supporting CropX fosters a collaborative approach to tackling some of the most pressing challenges facing the global agricultural industry. Overall, if CropX continues to scale its operations and innovate its offerings, this investment could yield significant returns both financially and in terms of environmental impact.

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