Baidu, SoftBank lead $182m funding round in Chinese agritech firm XAG

Chinese agritech firm XAG announced on Monday the completion of a 1.2 billion yuan ($181.6 million) new funding round led by Baidu Capital, an investment unit of Chinese internet search giant Baidu, and SoftBank Vision Fund 2.

Other investors included Sinovation Ventures, a venture capital firm led by former Google China head Kai-Fu Lee; Guangzhou Yuexiu Industrial Investment Fund Management, a private equity investment platform of Chinese financial services provider Yuexiu Financial Holdings; and government-backed Guangzhou Emerging Industry Development Fund.

Hong Kong-listed investment China Renaissance served as the exclusive financial advisor to the deal.

XAG’s existing investor Chengwei Capital also participated in the new round. As XAG’s first investor, Chinese VC firm Chengwei Capital had poured $5 million into its initial funding round in 2013, and re-upped $20 million in 2014.

The billion-yuan deal comes as investment activity in the Chinese agritech sector is heating up thanks to favourable government policies.

The Chinese government released a plan in January 2020 to promote the country’s digital agriculture development by leveraging big data, 5G, intelligent agritech solutions, and fresh produce e-commerce platforms. The plan targets to build an agriculture industry, 15 per cent of which relies on technologies and digital solutions by 2025, compared to 7.3 per cent in 2018.

XSAS™, a smart farm management platform developed by Guangzhou-based agritech firm XAG. Source: XAG

XAG was started in April 2007 by Chinese entrepreneur Peng Bin, a former Microsoft employee, to develop drones and remote ground control systems. The company, which was then called “XAIRCRAFT,” was rebranded to XAG in 2014 as it shifted focus to the research and development of agricultural drones that help optimise agriculture operations, increase crop production, and monitor crop growth.

The Guangzhou-based company has branched out to employ autonomous driving, artificial intelligence (AI), Internet of Things (IoT), and other technologies to power its agricultural drones and robots, as well as smart farm management solutions.

The firm currently delivers products and services to 42 countries and regions worldwide, according to its website. By far, it has served 620 million mu (413.3 billion square meters) of farmland worldwide.

XAG will use proceeds from the round to enhance its R&D and manufacturing capabilities, enrich sales channels, and accelerate the construction of digital agricultural infrastructures, in an attempt to build unmanned smart farms, said Peng in a statement.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.