Key Takeaways
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Blake Croegaert says the precision ag M&A boom has corrected sharply. The Verdant Partners M&A advisor points to valuations inflated between 2016–2022 (anchored by the Climate Corporation benchmark) that have since collapsed as farm economics deteriorated, OEMs like Deere, AGCO, and CNH posted 20–30% revenue declines, and strategic acquirers stepped back — leaving many ag tech startups without their expected exit path.
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Buyers now demand proof, not promise — but profitability is a double-edged sword. Acquirable companies today must show profitability or meaningful revenue scale, yet reaching profitability often shifts valuation from a higher revenue multiple to a lower earnings multiple, disadvantaging sellers.
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Traditional exit channels are constrained. Private equity won't engage until ag tech reaches stable profitability; family offices offer the right patient capital but are hard to access; and the IPO route is effectively closed after poor public-market performance — squeezing Series B/C investors in particular.
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AI is reshaping M&A unevenly, and regional dynamics differ. Agriculture lags insurance and healthcare in AI acquisitions, with early activity concentrated in breeding, biologicals, and trait selection rather than customer-facing tools. The US faces a larger correction after aggressive venture deployment, while Europe's more disciplined capital produced fewer companies and less fallout. A notable emerging trend: reverse acquisitions, where tech companies raise capital to buy established businesses (e.g., agronomy services) for instant channel access.
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2026 is the pivot year; 2027 is the restart. Improving farm economics should ease OEM pressure and set up a return of strategic M&A in 2027, while corporate carve-outs and divestitures — already accelerating — will continue reshaping the sector and may seed roll-up opportunities.
Blake Croegaert on the state of the precision ag M&A market
Blake frames the current market against a longer arc: the precision ag sector was, in his view, meaningfully inflated between roughly 2016 and 2022 — a period when Climate Corporation's landmark acquisition set a valuation benchmark that venture capital then chased at scale. “Everyone refers to Climate Corporation kind of setting a standard of what ag tech M&A could look like,” he observes. “Venture capital pumped capital in based on those valuations.”
What followed was a correction driven by two reinforcing dynamics. First, the broader farm economy deteriorated. Public OEMs — Deere, AGCO, CNH — reported 20–30% revenue declines over the last two years, creating inventory buildups and forcing a shift of focus from external growth toward internal performance. Second, the technology buyers that precision ag startups had counted on as eventual acquirers effectively stepped back. “A lot of technology companies, precision companies that would seek a strategic OEM or a strategic input company as the buyer of their business in M&A — they lost their audience,” Blake says. Companies that had planned for strategic exits found themselves needing to cut costs, raise bridge capital, or reconfigure entirely for standalone profitability.
On What Makes A Company Acquirable Today
The fundamentals of what makes a technology business attractive have not changed, Blake argues — strong IP, novel technology, and talent acquisition remain core. What has changed is the standard of evidence buyers require before engaging. “Today's market buyers need to see companies that are either profitable or close to profitable, or that have a significant revenue base and customer base that they can see scale and proof of concept in the market. Whereas three or four years ago there were lofty valuations based on a lot of promise and potential.”
He is careful not to dismiss the earlier optimism as irrational — “not to say it wasn't valid and the hype wasn't real” — but the shift is clear: promise is no longer a sufficient basis for valuation. Buyers want demonstrated performance in the field, not projections.
There is an additional complexity for companies that do achieve profitability. The transition from pre-revenue to profitable can actually change the valuation methodology in ways that disadvantage the seller. “You go from a pre-profitable business that trades maybe on a revenue multiple — that might be more aggressively viewed from what their future potential is — versus a company that reaches profitability, all of a sudden they're based on their profitability. So the multiple on earnings is going to be utilised versus the revenue multiple, and those can be lower at times from an enterprise value standpoint.” It is, as Blake puts it, a double-edged sword: buyers demand profitability as a condition of engagement, but once profitability is achieved, the company is valued as an established business rather than a high-growth opportunity.
Blake Croegaert On The Role of Private Equity & Family Offices
Private equity has not played the role in ag tech M&A that many in the sector had hoped for. The reason is structural: private equity requires a clear path to financial returns within defined time horizons, and most precision ag businesses have not yet reached the stable profitability that would support that model. “Until these companies can get to a point of stable profitability and growing, private equity's not going to be a significant buyer,” Blake says. “They focus on financial performance first.”
Family offices and private capital represent a more patient alternative — patient capital that can accommodate the natural commodity cycles of agriculture without the time pressure of a traditional fund structure. Blake sees the logic clearly but identifies a practical barrier: “The problem with family offices is finding them. They're very quiet. They are selective in what they look at. And very patient — so reluctant to probably enter into aggressive processes.” The fit is real; the challenge is access and relationship-building rather than alignment of interest.
One structural gap both acknowledge is the absence of a viable public market exit for ag tech companies. “There exists really no public option for a lot of these businesses,” Blake observes. Several companies that did pursue public listings performed poorly, and the market reaction has been severe enough that the IPO route is now largely off the table for most founders and investors. This removes what had been a planned exit mechanism for many Series B and C investors — a problem that feeds back into the difficulty of raising those later rounds.
Blake Croegaert On AI & Whether Agriculture Follows The Broader Tech Valuation Surge
The conversation turns to the AI valuation phenomenon visible across technology sectors and whether agriculture participates. Blake's assessment is measured: “Agriculture is still behind compared to what you would see from insurance or healthcare AI tools and technology acquisitions.” The adoption is real — every major player is integrating AI for internal efficiency, imagery, customer-facing services — but the willingness to make large bets on AI acquisitions is restrained. Part of the reason is that companies have already burnt their hands on technology M&A that did not deliver. Part is the pace of AI innovation itself: the fear of acquiring something that will be displaced within eighteen months is acute. “The pace of innovation within AI tools right now is so fast that their willingness to make an acquisition of a company today — even if there's a little bit of fear of getting displaced or maybe losing out if we're not at the front seat — I think there's more fear that in the current market conditions, they're probably not going to deploy capital and put a big bet on something that they're not very confident fits within their core.”
Where Blake does see AI-driven M&A taking hold first is in applications that make core business processes more efficient — breeding technology, biological product development using AI for field trial analysis, trait selection. “Those are areas where I think you'll see adoption from an M&A standpoint first.” Broad customer-facing AI tools, while being adopted operationally, are not yet commanding strong acquisition valuations.
On Regional Differences & An Emerging Trend: Reverse Acquisitions
The geographic pattern of M&A activity is uneven in ways that reflect underlying capital dynamics. The US saw aggressive venture deployment — and, in some cases, investments that in retrospect outpaced the evidence. “You had a lot more venture dollars pumped into companies that were started — maybe even raised money that they shouldn't have, just because of proof of performance or a little bit of cowboy Wild West investment from groups that didn't really know agriculture.” Europe was more measured: more patient capital deployment, more rigorous early-stage diligence, and proportionally fewer companies — which naturally translates into less M&A volume.
Blake Croegaert raises an emerging pattern worth watching: reverse acquisitions, where technology companies that struggle with market access raise capital to acquire larger, established businesses — gaining channel access and profitability in one move — rather than seeking to be acquired themselves. “There's reverse acquisitions that are taking place in some ways where you have a technology company that struggles to get to market that instead of going and trying to find somebody to buy their business says: why don't we go raise money to buy a business that's far bigger than we are?” The agronomy services category is one area he points to as particularly suited to this model — independent consulting groups with established farmer relationships and channel access, but without strong exit plans or technology ambitions of their own.
Blake Croegaert On The Outlook For 2026 and Beyond
Blake describes 2026 as a potential pivot year, with cautious optimism. Farm economics are expected to improve gradually, providing some relief to the OEMs whose appetite for M&A has been constrained by their own performance pressures. If 2026 is the reset, he expects 2027 to see a resumption of strategic M&A activity as major companies turn their attention back to growth. “Large companies do not innovate at a pace that can match early stage businesses. So they will always look to acquisitions of companies that are more nimble, more capable of developing tools and techniques faster than they can. We're in a pause moment right now on that, and that'll return once the market resets hopefully next year.”
On the divestiture side, Blake is more definitive: corporate carve-outs and divestitures have already increased. “We as a firm have done more corporate carve-out work in the last two years than we have historically seen.” Large companies are reviewing their portfolios, selling divisions that no longer fit strategic priorities, and in some cases unwinding prior acquisitions. This trend is expected to continue through 2026 and into 2027 — and with it, the possibility that divested assets become platforms for roll-up strategies or new ownership structures better suited to the businesses' actual stage of development.
Blake Croegaert is a Partner at Verdant Partners, specialising in M&A advisory, strategic transactions, and capital raising in the agriculture and food technology sectors. Connect with him on LinkedIn.
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