CGT fears vs US temptation: why local livestock success story is going abroad
Updated May 31 2026 - 6:36pm, first published 4:00pm
Worries about looming capital gains tax rises at home and the lure of new Trump administration rules for US investors have convinced a fast-growing Australian livestock nutrition business to head offshore.
Although backed to the tune of about $18 million by a mix of farming families, other mum and dad investors and high net worth family offices, nine-year-old Queensland nutrition products company, DIT AgTech, needs extra cash to fund its growth and doesn't expect to find enough help in Australia.
The agribusiness has become one of the first Australian scaleups to actively seek out private investing market reforms rolling out in the US in the past month, launching a $US15m multipart capital raising.
The US changes have been designed to push more capital into emerging tech companies by broadening their access to private markets and making fundraising easier, including more options to access ordinary retail investor funds.
The DIT (direct injection technology) business builds automatic livestock supplementation and monitoring gear and supplies urea and protein supplements, trace minerals, micronutrients and the Agolin methane reduction additive for animals to consume through existing water infrastructure.
About 300 DIT AgTech systems in Australia deliver precise nutrition boosts to more than 170,000 cattle and 200,000 sheep via their water troughs to compensate for natural nutritional deficiencies in the grazing environment, or difficult seasonal conditions.
Initially launched for pastoral region beef herds, demand has lately surged in southern Australia's mixed grazing sector, and opportunities are opening in the US and Brazil.
Aside from the herd and flock production gains available, the remote technology's benefits to producers include cutting labour and fuel costs associated with regularly putting out traditional supplements in lick blocks, or molasses-based loose lick products.
Big name customers include Australian Agricultural Company, Stanbroke Pastoral and Paraway Pastoral Company, with average production gains of 15 per cent and supplement and labour costs down about 30pc quoted by DIT.
On one northern cattle station, soluble supplement doses are going to 5000 cattle.
Company founder and chief executive officer, Mark Peart, said the gap between American and Australian startup funding settings was becoming difficult for young growth businesses like his to ignore.
One of his self-managed superannuation fund investors, restrained by investing regulations here, had already used the new US fundraising openings to direct $700,000 into DIT AgTech's recently-established US business entity.
Concerns around the potential capital gains tax hit to grassroots retail investors who take a financial risk to support fledgling Australian farm technology businesses were reinforcing Mr Peart's decision to seek out US shareholders.
In fact, the American investment environment and market opportunities were so much more encouraging, he said the Toowoomba headquartered firm may eventually concentrate its operations overseas, or potentially find an offshore buyer.
"The federal government's planned capital gains tax intentions are also clearly scaring potential investors here," he said.
"Like a lot of people who might invest in startups, they're absolutely hesitant at the moment."
Canberra's planned CGT changes, due next year, will replace today's 50pc capital gains discount with cost-base indexation.
That means a minimum tax rate of 30pc on realised capital gains from shares or other assets, regardless of whether the taxpayer's marginal tax rate is lower than 30pc, or under the tax-free threshold.
Mr Peart said enthusiasm for future investment had suddenly waned as uncertainty grew about the tax costs individuals might incur when the company they helped grow reached the point where it was sold, or listed.
DIT AgTech launched in 2017 raising $300,000 from mum and dad shareholders, deliberately pitching itself to family offices and ordinary retail investors who currently each average $20,000 stake.
Having raised about $18m in Australia since it was founded, DIT now boasts an implied capital value of $100m, with locked-in revenue of about $10m a year, which has grown more than 60pc since 2022.
Much of that revenue now comes from forward contracted supplement sales to livestock producers, who sign up for a $12,000 a year supply deal over three years.
They get DIT's treatment equipment and related water monitoring and artificial intelligence nutrient management advice free as part of their agreement.
Mr Peart believed the time was right to tap global investor appetite for livestock infrastructure technology.
He noted 10-year-old New Zealand virtual fencing business, Halter, had just raised $315m, plus $155m last year, to fund an expansion drive for its solar-powered GPS-enabled livestock collars in the US, Australia and Europe.
Halter launched in the US two years ago and has now sold about 100,000 kilometres of virtual fencing capability to ranchers.
Like Halter, DIT saw big North and South American livestock market opportunities where cattle numbers alone totalled about 600m, compared to Australia's 26m-strong herd.
It planned to open a sales base in Kansas City, Missouri, by year's end and target Brazil in 2027.
DIT's Americas push would initially be funded by its $US5m retail crowdfunding campaign to ordinary US investors and a parallel $US10m share placement to accredited US and offshore investors, via registration platform, DealMaker.
Mr Peart said the recent US investing rule changes had broadened accredited investor definitions, lifted investor caps and expanded retail access to private markets.
In Australia, crowd-sourced funding limits kept fund raising to a one-month window per year and a $5m limit, while the US limit of $US5m was open for one year, with any money raised throughout that period could be deployed for business expansion immediately.
Australia's much smaller population meant the pool of retail and growth-stage capital available to emerging local businesses was also limited.
The US expansion was also about more than just accessing capital, but also who got access to the opportunity.
"I want ordinary investors to continue being part of our growth," Mr Peart said.
"I'm not comfortable with the big end of town - private equity and venture capitalists - generally getting first bite of tech growth opportunities and taking big gains, while everyday people generally have few chances until a company lists publicly.
"Every current DIT shareholder is a retail investor, a family office, or a staff member.
"There is no venture capital on our register."
