Sustainable Ag Startup
Dan Horan had a notion back in 1989 that started with a college essay and turned into a business plan: enlist the cooperative efforts of various small farms in the region to supply supermarkets with locally produced foods. The idea of bringing the farmers’ market to the local supermarket was planted, he says.
“Fast-forward to 2010,” says Horan. “I sold the company I was involved with and hired my first employee.”
The name for Horan’s new venture, Five Acre Farms, came from the principle of small, local agriculture serving its local communities, according to Horan.
“Our focus was on the mainstream customer,” says Horan, “improving their access to local food where most of the shopping is happening—in the supermarkets. Less than 10 percent of people can support the farmers’ market. We wanted to be in the mainstream shopping centers.”
With each passing year, 100 million acres of corn are sown in the United States. As these acres are fertilized, an estimated 50 percent of the nitrogen applied is wasted due to runoff and other factors, so that half of the hefty sum spent annually by corn farmers to feed their fields might as well be poured down a drain or tossed to the wind.
The enormous scale and consequence of this waste is what motivated a team of three very bright brothers with expertise in environmental science, dairy farming and robotics to devise a solution called “Rowbot.”
When a hydroponic farm grows a head of lettuce, the story doesn’t start with a seed.
Every part of the environment has to be provided for the seeds before they germinate, including everything that nature usually gives away for free.
To make a plant’s conditions ideal, the farmer must also be a plumber, an electrician, an engineer, and a chemist. Even those growers with lots of experience often lack the construction expertise that building a hydroponic farm requires, so they turn to those whose sole business is building.
With almost a decade’s worth of aquarium design, filtering technique and fish tank science under their belts, Eric Suen and Kevin Liang, co-founders of Aqua Design Innovations, feel confident they have the experience, knowledge and vision to offer a sustainable aquarium that utilizes aquaponic growing techniques at an affordable price.
Their product, the EcoQube, is a desktop-size, self-regulating aquaponic ecosystem complete with plants, fish, and lighting. The pair launched a Kickstarter campaign on Nov. 30, 2013, hoping to raise $39,000 by Jan. 12, 2014. If funded, the money will enable the company to start production.
In 2011, playwright, theater director and technology consultant Erika Block started the company Local Orbit with the goal of facilitating more efficient local food networks. By providing sustainable food producers with sales and business management tools, Block hoped the company could help address some of the inefficient infrastructure issues in our modern-day food system.
Over the past two years, Block has watched her vision for the company gradually transform into reality.
“Our team has doubled,” says Block. “We’ve tripled the number of markets on our platform. We currently support local marketplaces and trading networks in nine states, with over 500 food producers and 2000 buyers using the platform.”
It all started with a Facebook post.
Nick Papadopoulos was working as acting general manager of Bloomfield Farms, his wife’s parents’ 45-acre organic vegetable farm located in Northern California. One day, he found himself alone in the cooler after a farmer’s market, sipping on a beer and observing all of the unsold food that would soon become part of the farm’s chicken feed and compost bins.
Suddenly, he had an idea. Instead of giving premium organic produce to the chickens, why not give it to hungry people? So, he went online to Facebook and started typing. The original Facebook post offering leftover produce that started the cropsourcing website known as CropMobster can still be seen on the site today.
Sustainable agriculture entrepreneurs have a new fundraising option. AgFunder, an equity crowdfunding platform launched its beta site on Sept. 23, the same day that the Securities and Exchange Commission lifted an 80-year old ban on general advertising and soliciting for private investments.
AgFunder combines the business, scientific and agronomist acumen of its three founders to create a true crowdinvesting platform for agriculture startups. For each project listed on the site, AgFunder creates a fund, which in turn holds a stake in the project. This differs from the crowdfunding model of sites such as Kickstarter and IndieGoGo, as investors actually own a piece of the project instead of just preordering a product or making a donation to a worthy effort. AgFunder makes money by charging a listing fee to each project, and by taking a cut of the profits paid to investors.
To meet world food demand in the future, agriculture productivity must increase by a factor of 1-2% per year, more than doubling total output by 2050, according to the Global Harvest Initiative’s 2012 GAP Index report. At the same time, global demand for biofuels is projected to increase by 133% by the year 2020, according to Hart Energy’s Global Biofuels Outlook Report.
Intensification of unsustainable agricultural practices to meet these competing needs often harms soil, causing nutrient depletion, erosion, salinization, and chemical, and allows the introduction of crop pests. The result: significant amounts of land are removed from production indefinitely every year. The Food and Agriculture Organization of the United Nations estimates 1-2% of global cropland is removed from production annually due to salinization alone.
That statistic got the attention of Naveen Sikka, Founder and CEO of TerViva, an Oakland, CA-based sustainable agriculture startup aimed at developing new crops for marginal or underutilized farmland.