Alibaba, Baidu, and Tencent – known collectively by the acronym BAT – pumped hundreds of millions of dollars into the agrifood vertical last year, according to AgFunder’s China AgriFood Startup Investing Report 2019, published with Bits x Bites.
Between them, they invested in agrifood startup funding rounds worth just over $640 million during 2019. This represents a substantial rowing back on their investments in the sector in 2018.
That year, Tencent and Alibaba alone accounted for $2.7 billion in Chinese agrifood startup funding – almost half the sector total. They were the second and third most active investors in the space, respectively, by number of deals, with only Matrix Partners making more investments.
However, 2018 was characterized by several outsized deals that boosted these numbers. These include Meituan Dianping’s $1.5 billion pre-IPO raise, which Tencent participated in. The Shenzhen-based tech giant also joined a $450 million round for e-grocer MissFresh, while Hangzhou-based Alibaba pumped $280 million into its rival 1919.cn (it also paid an estimated $9.5. billion to acquire Meituan’s food-delivery competitor Ele.me).
Despite a lower investment figure overall, 2019 still saw several big startup deals involving the three BAT tech giants.
Baidu has fallen behind its two rivals in recent years, with Meituan and NetEase pulling ahead of it in market cap terms. Nevertheless, it remains an active player in startup investment – including in agrifood, where its 2019 deals highlighted its differing strategic priorities when compared to Alibaba and Tencent.
While the larger two focused on downstream, consumer-facing investments in 2019 – particularly in AgFunder’s eGrocery category – Baidu backed two upstream startups in the Farm Management Software, Sensing, & IoT category, reflecting its pivot away from being an internet-centric player towards artificial intelligence and related technologies.
Here are the BAT firms’ 2019 agrifood startup investments in China: