AIoT farming solutions

Smart agricultural system

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AIoT farming solutions
SectorMost major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Food and Beverage
Food and Agriculture
Business Model Description

Invest in AIoT farming solutions, which combines farm management software and IoT devices, providing farmers with actionable information on factors such as the condition of their crops, soil and weather

Considering that field crops and cash crops are completely different and even within the category of cash crops, different crops have different scenarios, AIoT solutions need to be integrated with crop scenarios to complete a loop (an investment professional in agriculture).

It is difficult to make money purely by selling AIoT solutions; more and high added values have to be provided through other services. To convince farmers to purchase, companies have to first help farmers make a profit before they can make money from farmers.

According to 36Kr, solutions provided by startups such as MCFLY and Talent Cloud Information Technology are to gain the trust of farmers and increase stickiness. Their main profit, however, mainly comes from the procurement of input and the distribution of produces. (1)

Expected Impact

Positive impacts include improving the economic well-being and the technological expertise of agricultural workers in China.

Indicative ReturnDescribes the rate of growth an investment is expected to generate within the IOA. The indicative return is identified for the IOA by establishing its Internal Rate of Return (IRR), Return of Investment (ROI) or Gross Profit Margin (GPM).
15% - 20% (in IRR)
Investment TimeframeDescribes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.
Short Term (0–5 years)
Market SizeDescribes the value of potential addressable market of the IOA. The market size is identified for the IOA by establishing the value in USD, identifying the Compound Annual Growth Rate (CAGR) or providing a numeric unit critical to the IOA.
> USD 1 billion
Average Ticket Size (USD)Describes the USD amount for a typical investment required in the IOA.
One potential success story in this sector is Zhejiang Top Cloud-agri Technology Co., Ltd. Between 2016 and 2017, the company increased its net profit margin from 19.6% to 25.5% and its ROE from 16.9% to 22.1%.
Direct ImpactDescribes the primary SDG(s) the IOA addresses.
Zero Hunger (SDG 2)
Indirect ImpactDescribes the secondary SDG(s) the IOA addresses.
Industry, Innovation and Infrastructure (SDG 9) Decent Work and Economic Growth (SDG 8) Life on Land (SDG 15)
Sector Sources
  • (1) Ministry of Agriculture and Rural Affairs (MARA), 2015 2) MARA, 2015 3) MARA, 2018 4) International Food Policy Research Institute, 2020 5) Red Cross Society China, 2019 6) Ministry of Foreign Affairs,2019 "7) Ministry of Human Resources and Social Security,2020." "8) UNDP.2019" "9) National Bureau of Statistics" "10) CGTN,2020"
IOA Sources
  • 21) 36Kr, 2018, 22) Qianzhan Industry Research Institute, 2019, 23) State Council, 2020, "China No.1 Central Document of 2020", 24) State Council, 2018, "25) State Council, 2018, " 26) Ministry of Agriculture and Rural Affairs (MARA), 2018, 27) State Council, 2018, 28) Ministry of Education, 2018,