A new study published in Progress in Economic Geography finds that agricultural startups operating within established, incumbent-dominated regional food systems tend to produce incremental innovations rather than transformative ones, with existing network structures playing a decisive role in shaping what is commercially and practically possible.
The research, led by Katharina Rock of the Leibniz Centre for Agricultural Landscape Research (ZALF) in Müncheberg, Germany, focused on a region of northwest Lower Saxony that has been described as Germany’s “Silicon Valley of modern agricultural production.” The area is home to a dense cluster of large conventional agri-food businesses that have developed closely interlinked value chains over decades.
How tight networks limit new ideas
The team conducted 16 semi-structured interviews last year with participants from academia, business, public administration, funding bodies, and the startup scene. Rather than measuring proximity purely in geographic terms, the study assessed five dimensions: spatial, cognitive, social, institutional, and organizational.
Across each, it found that incumbents maintain strong mutual ties that are difficult for startups to penetrate. Where startups do gain access to established networks, often via accelerators or intermediaries, their innovations tend to be shaped toward solutions that fit existing business models. More disruptive ideas, including those with stronger sustainability credentials, are frequently sidelined until they align with incumbents’ interests.
Social ties in the region run particularly deep, with business relationships reinforced by community organizations and, in several cases, family connections. The study describes this as giving incumbents effective power to prefigure which opportunities agri-startups can realistically pursue.
“Our results show that innovation in agriculture doesn’t succeed or fail solely based on good ideas. It’s also crucial whether new actors gain access to existing networks, and whether there’s room within those networks for knowledge that doesn’t yet fit the established norm,” said Rock.
Farmers largely absent from innovation processes
A secondary finding is that farmers were rarely mentioned by interviewees as active participants in regional innovation. Given that agri-startups are largely developing products intended for use on farms, the study describes this disconnect as a weak network failure, with limited interaction between startups and their intended end users affecting the practical relevance of what gets developed.
The research suggests that founders with roots in traditional farming regions who have also gained experience outside those systems may be better positioned to bridge that gap, maintaining the social access needed to work within established structures while introducing ideas less shaped by incumbent norms.
