Posts By Nicola Kerslake
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.
Looking to his Roots, Former Engineer Launches Sustainable Olive Oil Business in Corning, CaliforniaJanuary 31, 2012 | Nicola Kerslake
When Dewey Lucero was laid off from his engineering job in 2005, he started to think about taking his career in a new direction. Growing up as the grandson of two olive farmers in California’s Central Valley, Lucero was accustomed to helping out with the harvest from a young age, and eventually turned to his roots. “I realized that I could build on my grandfathers’ work by developing an olive oil brand,” said Lucero, who told me about the origin of his sustainable olive oil business at a jam-packed tasting event last weekend. One of Lucero’s grandfathers had sold table olives, while the other sold to the region’s largest olive oil mill and occasionally crushed olives to bottle oil for friends and family.