FLORA Ventures, an early-stage venture capital firm dedicated to investing across the agrifood industry, has officially launched with commitments of $50 million, with hopes to close the remaining $30 million by the end of 2023.
The Tel Aviv-based fund was co-founded by Gil Horsky, former senior director of Mondelēz’s venture unit SnackFutures; and Esther Barak-Landes, founder and CEO of Nielsen Innovate. It is reportedly the largest agrifood-focused VC in the country, according to IVC data.
The duo completed their initial raise in only four months from strategic partners, including Sadot, a co-op bringing together more than 185 Kibbutzim; several family offices; Haifa Group, a leading player in plant nutrition and special fertilizer; and Harel Group, Israel’s largest insurance and finance group. FLORA Ventures also claims to be the first VC to tap Kibbutzim, a collective concept rooted in the Israeli agricultural communities, as anchor investors.
“These agricultural co-ops, influenced by the socialist concept of living together, mainly came from Eastern Europe over 100 years ago,” Horsky explained, noting how the fact that one-third of Israel is desert has pushed Kibbutzim to come up with some of the most notable agricultural innovations, such as drip irrigation.
“It’s the first time they’ve ever backed and been involved in an agrifood tech fund as one LP,” he said, providing farmland and other resources for FLORA’s future portfolio to test their technologies.
Robust Development In Israeli Foodtech
Israel has emerged to become a hotbed of agricultural and food innovations with interest across alternative protein, robotic delivery platforms, and climate tech skyrocketing over the years. A recent report from The Good Food Institute Israel revealed how local foodtech startups ranked second in the world after the U.S. in terms of funding size with a total investment of $454 million pouring into alternative protein alone in 2022.
The amped-up competition in the Israeli foodtech space has already created a ripple effect in the U.S., when Horsky was working for Mondelēz, during which the snacking powerhouse made a seed investment in Torr FoodTech. “We’re talking about 850 startups, and some of the best agrifood companies here in Israel,” said Horsky.
FLORA Ventures has so far invested a stealth mode startup Arrakis Bio that’s poised to revolutionize the production and utilization of human collagen and gelatin. Moving forward, it will mainly focus on pre-seed, seed, and series A companies across Israel and Europe by writing an average check size of $1-4 million depends on the stage of each company, and evaluate potential deals based on its “3 Ps” principle — people, potential, and purpose, which respectively represent founders’ backgrounds, market size and projected returns, as well as future impact. Additionally, a robust entrepreneurial scene in Europe is expected to help FLORA’s future portfolio companies scale together when they enter the U.S.
“On the high level, our investing thesis touches upon two complementary universes — planetary health and human health. These could be functional ingredients, food as medicine, sustainability, and regenerative agriculture,” Barak-Landes said.
“Our investment cycle will be around four to five years, so we are going to dedicate half of the fund in the first few years to our initial investments,” Barak-Landes added, “and then we are deploying the rest 50% for follow-on investments.”
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