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August Monthly Special 2023

Carrot Ventures – Seeding New Technologies to Commercialize AgTech Ventures

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AVAC Group (a Canadian venture capital company which applies its knowledge, network, and capital to advance the commercialization of technology to achieve a sustainable world) launched Carrot Ventures to address systemic challenges faced by AgTech start-ups. Carrot sources and vets new technologies, recruits experienced leadership, forms new companies around the tech and talent, and leads the first round of financing. The goal is to offer AgTech IP owners a Third Option to commercialize their IP, and to offer AgTech investors a stream of compelling start-ups to invest in. Carrot ventures forms and funds new companies to commercialize novel technology. It's the Third Option for AgTech IP owners, when internal support is lacking, or when inventors don't want to be an entrepreneur. Carrot does not fund existing companies.

Q. Why Carrot?

After more than 20 years of investing in start-ups, AVAC Group kept seeing tech companies struggle, stall, and outright fail for the same reasons. While start-up founders say they suffer from a lack of funding, the reasons they lack funding are almost always the same:

  • Value propositions don’t address substantive market problems
  • CEOs and management teams are lacking in areas important to investors
  • Overcomplicated corporate and capital structures deter investors
  • Inexperience with raising capital
  • Insufficient governance to satisfy investor risk tolerance

Any one of these challenges makes it difficult to raise capital. In combination, they make it nearly impossible to attract sufficient investment to finance commercialization. Carrot puts a solid foundation in place, making the path to financing and commercial success faster and easier.

The Carrot Process

The Carrot Company Formation Model provides a solid foundation for growth.

Each new venture begins with:

  • Vetted technology with a compelling value proposition
  • An experienced CEO at the helm, with a viable business plan
  • A corporate structure attractive to investors
  • The backing of a committed institutional investor

This powerful combination enables a new company to raise the capital it needs to support rapid value creation.

Q. How does it work?

Step 1: Express Interest

The owner of AgTech IP expresses interest in Carrot Ventures by completing the Express Interest form.

Step 2: Preliminary Assessment

After reviewing the information shared, a Carrot representative will contact you to discuss your technology and determine whether there is alignment with the Carrot business model.

Step 3: Due Diligence

Carrot completes a thorough evaluation of your technology and market opportunity to determine whether there is commercial justification to continue.

Step 4: Negotiate A Deal

Carrot and the IP owner negotiate commercial terms. This takes the form of an Option Agreement under a 12-month right of first refusal. This gives Carrot time to conduct the remaining steps in the process.

Step 5: Recruit a CEO

Carrot recruits an experienced CEO to become the founder of the new AgTech start-up. A global recruiting firm is hired to find an ideal CEO, one of those rare people with relevant domain and commercialization experience and an entrepreneurial mindset.

Step 6: Form a New Company

After a CEO is successfully recruited, Carrot creates a new company. A top tier legal firm is used to ensure the corporation is structured properly for the journey ahead. The IP Owner, the recruited CEO, and Carrot Ventures all become founding shareholders in the new venture. A governance board is established to guide the company.

Step 7: Carrot Financing

The recruited CEO’s first task is to develop the new company’s business and financial plans, for approval by the company’s board of directors. With approved plans in place, Carrot Ventures issues a financing term sheet to the company. With the strength of vetted technology, the CEO’s credentials, a properly formed and structured company, and an institutional investor to lead the first capital raise, the CEO proceeds to secure seed financing for the company.

Step 8: Governance & Growth

With financing secured, the CEO executes the company’s plan and leads all operational matters for the company.

Carrot Ventures | Leadership

Martin Vetter is a Co-Founder and the Managing Partner of Carrot Ventures.  Martin helps bring great technology to market. He brings his operating and financing expertise to bear on sourcing technologies, recruiting talent, negotiating investment terms, and enabling investee success.

Martin serves as a Director or advisor to several companies, including BlackSquare, Leankor, LoginRadius, SAMdesk, Susterre Technologies, Cellar Insights and Wedge Networks, and is a Partner of Accelerate Fund I, L.P.

Martin earned a BEng from Memorial University of Newfoundland, and an MBA from the University of Calgary.

Jim Hardin is a Co-Founder and the Managing Partner of Carrot Ventures. As a past company founder and entrepreneur, Jim has insight into the challenges of early-stage company formation, and the actions needed to address them. He draws on this experience to identify investment opportunities, define value propositions, and lead investment transactions, with a goal to build and finance innovative agricultural technology companies.

Jim has worked closely with a variety of companies to build value and realize commercial opportunities including Baby Gourmet, Botaneco Inc., Livestock Water Recycling and Decisive Farming.

Jim earned a BSc and a PhD from the University of Calgary.

“We are The Third Option for novel technologies seeking an alternate path to market. We’re ideal for IP owners who want someone else to commercialize their technology.”

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