Third Quarter Agriculture Innovation Highlights & Trends
A number of innovative business models have received venture funding this past quarter. As we prepare the upcoming Agriculture & Food Quarterly Innovation Monitor, I wanted to provide highlights of the companies which received funding this past quarter. Moreover, this blog posts demonstrates the continued high level of innovation taking place in the agriculture and food space.
Three separate and relatively new trends which stood out to me this quarter were: nutrient upcycling, environmentally friendly field treatments and energy efficient indoor cultivation systems. These market segments may not have received the most attention from VCs this quarter, but I think they are ahead of the curve and showcase technologies which are tackling big problems and chasing very large opportunities.
Prota Culture has developed a novel bioconversion process to convert organic waste into nutritional products using insects. Their system uses pre-consumer food waste to feed insects which are then harvested for their protein. This process is significantly more efficient and requires far fewer resources compared to raising cattle or other livestock; while providing the same nutritional benefit. In fact a company called Exo, which makes nutrition filled protein bars using cricket flour, received funding this quarter. There are additional beneficial products created through this bioconversion process including nutrient rich compost.
Nutrinsic works with food and beverage processors, from palm oil producers to brewers, to help recover nutrients from their wastewater streams using its own proprietary technology. While the installer of the system will lower their wastewater disposal costs and GHG emissions, Nutrinsic is also able to convert these minerals into protein using an aerobic process for use in a number of products. Sustainable animal feed and organic plant fertilizers are just two of the valuable products that Nutrinsic manufactures from these upcycled nutrients.
Environmentally Friendly Pest Control
A number of companies are also working to develop more environmentally friendly alternatives to traditional pesticides. At the forefront of the nascent biologic pest control movement is Oxitec. Oxitec uses advanced genetics to breed insects which insert a kind of “time-bomb” into the genetic pool of a pest insect population. Oxitec’s genetic technology revolves around the insertion of a lethality gene into the target species which will cause all offspring of an Oxitec male and wild female to die early in the lifecycle. This provides a natural way for farmers to disrupt the type of outbreaks which would have traditionally required harmful non-targeted pesticides.
An equally innovative, yet different, approach to control of agricultural pests is being taken by Michigan-based Vestaron. Based upon their research into peptides found in spider venom, Vestaron has been working to develop environmentally benign insecticides. Their research has revealed a number of peptides which target the metabolic pathways of pests and through a patented process Vestaron has advanced three separate products into the late-stage development phase.
Indoor Cultivation Advancements
While traditional non-greenhouse methods of indoor cultivation used energy sucking HID lights and necessitated complex HVAC systems, the rise of LED grow lighting has enabled a new generation of significantly more energy efficient indoor farms to emerge. Whether the produce is grown in repurposed shipping containers, as with PodPonics, or in urban warehouses, like with FarmedHere, one thing that most of these operations have in common is the use of vertical farming practices. This cultivation style uses multiple tiers of growing racks to greatly increase the available square footage for production. LED lighting has contributed to the viability of this practice as well. Traditional HID lights would burn plants if they were as close as they are in these systems. An additional advantage of LED lights, besides their much lower power draw, is the fact that their output spectrums can be customized to target the specific nanometer-wavelengths of light which chlorophyll is most efficient at converting into stored energy.
An efficiency increasing step which many of these indoor farms, including FarmedHere, are increasingly taking advantage of is the practice of incorporating aquaculture into their farming systems, known as aquaponics. In this closed loop system the nitrogen rich water from the fish tanks is circulated through the plants which provide them with beneficial nutrients while also cleaning the water; which then circulates back into the fish tank. This can not only save on water and fertilizer costs, through adding in another source of revenue it can greatly boost the bottom line of indoor farmers. While this sector did not garner the level of attention as red-hot drones or ag-analytics software I feel the rapid advancement in these indoor systems position it as a sector to keep an eye on going forward.
With all of these groundbreaking and exciting technologies being developed it’s no surprise that agriculture investment in the third quarter kept up with the elevated level of attention it has been receiving all year. To get all of the specifics look out for the 3Q14 Ag & Food Quarterly Innovation Monitor, which will be published during the first half of November, here.
Be sure to also sign up for our upcoming webinar on November 19th at 11am PST/ 2pm EST, Farming in the Cloud – Agriculture Meets the Internet of Things, to dive deep into the emerging innovation landscape in agriculture.