venture capital agriculture
While working for a Uruguay-based multi-national software company, Eddie Rodriguez von der Becke, whose in-laws raise livestock in Argentina, realized that the same level of technology sophistication that he employed at his company could be used to develop a livestock management system to help his family’s operations run more smoothly and efficiently.
The solution that he came up with was Tambero.com, a free global software solution for agriculture and cattle management.
There is only ONE DAY LEFT to lock in your ticket at the Rooster Special Ticket Price for the Seedstock Sustainable Agriculture Innovation Conference (details below) at UCLA. The conference has recently added a number of new sponsors including Whole Foods Market, Palumbo Family Vineyards and Wine, the UCLA Anderson School of Management’s Entrepreneur Association and Net Impact Branch.
News Release–SUNNYVALE, Calif.–Blue River Technology, a pioneer in the use of computer vision and robotics for agriculture, today announced it has raised $3.1 million in Series A funding led by Khosla Ventures. Steve Blank, author of “The Startup Owner’s Manual,” Ulu Ventures, and Stanford Angels and Entrepreneurs also joined the round. In addition, Ryan Kottenstette of Khosla Ventures has joined the company’s board of directors.
Founded in 2011 by two Stanford University Alumni, Blue River Technology is developing an alternative to chemical-intensive agriculture, which is both expensive and hazardous to the environment.
Running a dairy or cattle operation efficiently requires the management, tracking and assessment of complex sets of data ranging from animal feeding cycles and health to overall production performance. Farmers and their teams often spend an inordinate amount of time and money shuffling through spreadsheets, manually cobbling together data to insure that their operations run smoothly.
To solve this problem and increase the efficiency of data management, a company called Farmeron has developed an online software product that enables livestock farmers to easily track the ins and outs of their animals. The company’s software program allows farmers to manage such data sets as the number of animals on the farm, feeding cycles, milk production, medical treatments, location transfers and much more. Through Farmeron’s cloud-based web application, farmers can update their data as they go and later create reports and analytics that keep their farms running more efficiently.
For many sustainable agriculture entrepreneurs the point at which their ideas become ‘real’ is the one at which they must confront the decision as to whether to patent their technology or process. This decision point frequently comes even before pilot projects are established or target customers identified. Unless you’re fortunate enough to work at a university or research facility that is willing to cover the cost of patenting, it will typically involve spending anywhere between $5,000 and $20,000 in legal fees in addition to using team time, at a stage where time and funds are scarce; so the decision is rarely taken lightly.
Biomass-based biofuels – fuels produced from renewable biological resources – are arguably the most successful of sustainable agriculture sectors when it comes to attracting investors. While other sectors were fortunate to break $100 million in investments, 33 biomass deals raked in just under $1.4 billion last year, according to industry journal Biofuels Digest.
For a startup, the odds of obtaining venture capital funding are lower than one in 100, likely less for a sustainable agriculture startup as I’ve covered elsewhere. The odds of securing a federal grant on the other hand are more like one in six , and they rise if you’re a student or university researcher. Yet, most agriculture startups spend a disproportionate amount of time chasing venture capital, and comparatively little considering grants as an option.
In the not too distant past, startups developed using government grants as opposed to equity investments were considered less hip than their venture capital backed brethren; the rationale being in part that those receiving grants would be less apt to move their idea speedily towards commercialization.
Ejnar Knudsen is one of the better known hedge fund managers in the sustainable agriculture space; he was investing in the sector as far back as the late 1990s, when he led Rabobank’s investments into the early wave of food and agriculture internet sites such as farms.com, a collection of agriculture information sites, and eHarvest.com, a news provider.
Knudsen is a long way from the stereotype of a money-hungry MBA-grad hedge fund manager; he describes himself as a “flexitarian” and is absorbed with finding better ways of utilizing fish oil and nuts to provide health benefits after weaning himself off cholesterol drugs thanks to a nut-rich diet. Until recently, he was one of the portfolio managers at 12-year old San Francisco-based hedge fund Passport Capital. A few weeks back he spoke about his interest in alternative proteins at a recent agriculture investing conference.
The following post is part of a new column by real assets investor Nicola Kerslake that will focus on topics related to investment in sustainable agriculture and aquaculture. Last week’s post focused on the reason for a lack of venture capital investment in sustainable agriculture.
Like many a software guy, David Tze was flipping through Wired magazine back in 2004 when an article caught his eye. It described the overfishing of the world’s oceans and painted a grim supply picture going forward. The article piqued Tze’s interest and he through himself into learning as much as he could about sustainable aquaculture; “I became a little obsessed,” he admits.
A couple of months later, he began discussing the issue with his college classmate JaredPolis, the bluemountainarts.com, ProFlowers entrepreneur and current Congressman representing Colorado’s 2nd Congressional District. Polis was equally fascinated by aquaculture and eventually invited Tze to join his family office to focus on finding investments in the sector and Aquacopia, “the first and only aquaculture venture capital firm,” was born. “Our goal was to prove that you could make venture returns in aquaculture just as well as in technology,” Tze adds.
The following post is part of a new column by real assets investor Nicola Kerslake that will focus on topics related to investment in sustainable agriculture. Sample topics will range from venture capital investment in sustainable agriculture and what VC investors look for in a startup to advice for entrepreneurs on obtaining government funding for agriculture projects and the benefits of joining an incubator.
A couple of times a week, I get a call from an agriculture startup with the same complaint: “We have a brilliant idea and customers ready to go, but no venture capitalist invests in agriculture”. By and large, they’re right. Despite mainstream media reports – notably in the New York Times – that predicted a wave of venture capital (VC) investment into sustainable agriculture, only $6.4 billion was plowed into the entire food and agriculture sector by private equity investors in 2011. This amounts to a mere 3% of total investment.