Unlocking Canada’s Foodtech Potential: The Need for Increased Investment

Canada’s foodtech sector is poised for growth, but it requires a larger and more engaged investor base to reach its full potential. A recent report from the Canadian Food Innovation Network titled Foodtech in Canada: 2025 Ecosystem Report sheds light on the challenges and opportunities facing the industry.

Investment Disparities

Despite notable growth in recent years, Canada’s agrifoodtech sector still lags behind countries like the US and UK in terms of investment. From 2018 to 2024, Canadian agrifoodtech startups received $1.6 billion in funding, compared to $8.8 billion in the UK and $86.6 billion in the US.

The report identifies a venture capital gap in Canada, with startups heavily reliant on public grant money. While grant funding accounts for 30% of agrifoodtech funding in Canada, it’s only 8% in the UK and 5% in the US. Additionally, only 40% of Canada’s funding comes from venture capital, compared to 60% in the US and UK.

Challenges in Scaling

Canadian startups face challenges in accessing growth capital, especially in later-stage funding rounds. Series A and B deals in Canada are smaller compared to the US and UK, leading to difficulties in scaling operations, building supply chains, and meeting regulatory requirements.

There is a widening gap in funding beyond the seed stage, indicating a barrier for Canadian foodtech startups seeking growth capital. The report emphasizes the importance of private investment in bridging this gap.

Untapped Potential

Canada’s foodtech sector has untapped potential, with only a small portion of investors actively supporting the industry. Of 311 total investors, only 43 have made five or more agrifoodtech-related investments, highlighting the need for a larger and more engaged investor base.

Building a stronger community of risk-tolerant investors can unlock the potential of Canada’s foodtech scene and drive global breakthroughs. Increased private investment is crucial for scaling the industry and competing with the US and UK.

Future Outlook

Despite challenges, investment in the Canadian agrifoodtech sector is expected to continue. Technology will play a key role in increasing sustainable production, reducing environmental footprints, and enhancing food security in the face of climate change. The sector aims to provide nutritious foods for Canadians and expand exports abroad.

With the right support and investment, Canada’s foodtech sector has the potential to thrive and make a significant impact on the global stage.