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This week on Startup Street, an agri-tech firm is trying to grab a piece of the organic produce pie. Bill Gates advances his climate change fight. And the startup by the creator of Android gets more bad news. Here’s what went on:
Chemical-Free Food Need Not Burn A Hole In Your Wallet
A three-year old Indian agri-tech startup is making farm produce more nutritious by using minimal amounts of supplements and fertilisers but not enough to leave chemical traces in the soil or the food. And all of it will reach your platter on a budget.
Pune-based EarthFood has been growing vegetables by using organic manures and nutrients supplements, something it calls residue-free farming, which can placed between organic and traditional farming. This allows the startup to produce food which is higher in nutrient content but available at market rates, Nilesh Palresha, founder of EarthFood, told BloombergQuint.
Organic food products are priced at least 30 percent higher than normal products, Palresha said.
Currently operating only in Pune, EarthFood has managed to sensitise pricing according to the city’s grocery markets despite having a 0.5-2 percent higher cost. “Since we have a farm to market concept, the business model allows us to price products at the normal rate despite having higher costs,” Palresha said.
With the country growing more health conscious, the organic domestic market has grown to Rs 4,000 crore, according to a EY report. This is likely to increase by Rs 1,000-1,200 crore by 2020 with a similar increase in exports.
“We started our production in 2015 with 1.5 metric tons per month. Currently we sell 40 metric tons per month and soon by the end of this year we expect to achieve 100 metric tons per month,” Palresha said. The company’s grows iceberg lettuce, broccoli, Pok choy, zucchini, French beans, gawar, lady finger and green chilly, among others on their 370-acre farm in Pune.
The startup will soon expand into milk and milk products using the Rs 6.4 crore funding received from Rairah Corporation in May. In another four months, the startup will start growing produce using hydroponics—farming in the absence of soil—for which the infrastructure is being set up.
A $116 Million Step Towards Zero Emissions
Bill Gates’ startup fund Breakthrough Energy Ventures has opened a $116 million investment fund to find researchers working on innovative ideas around cleaner technologies and help them build companies.
The billionnaire philanthropist was in Brussels last week to sign a memorandum of understanding with the European Commission to establish the investment fund where he emphasised the need for cutting down emissions, a cause that he has been championing for a long while.
“The total amount of energy used over the next 50 years is going to double. And we want economies to grow. But at the same time we need to slash global emissions,” Gates said at the media event to inaugurate the fund. “So what you need is to make every unit (of energy) with less and less emissions and in most cases you have to get to zero emissions. How can that be done? The answer is obviously innovation.”
Gates said that Europe has an “incredible number” of scientists working on ways to cut down emissions. “The committment of Breakthrough Energy here is to build a team and find those ideas,” Gates said. “But that's just the start but then you want a lot of those people to be building companies and partnering with existing ones. We are counting on Europe to lead the way in a lot of these areas.”
The $1 billion Breakthrough Energy fund was established by Gates in 2016 aimed at funding long-shot technological breakthroughs in the climate change fight. The 20 year fund had a longer timeframe than conventional venture capital investments, which usually find too much risk in such ideas.
“This is a new type of funding,” Gates said, adding that clean energy funding is different and requires a team with different skillsets that can help build companies. “You can say that it's type of a private-public partnership where we're making sure that its good science and the economics work. We have a lot of skills between the commission and ourselves to make it work”
The Breakthrough Energy fund has also found seed backers including Amazon.com founder Jeff Bezos and Alibaba Group Holding Ltd. founder Jack Ma and the founder of Bloomberg LP Michael Bloomberg.
The European fund is expected to begin operating next year. Half its equity will come from Breakthrough and the other half from the EU’s InnovFin program. Gates added that they will come back after a couple of years to map the progress and explore possibilities of scaling up the investment.
We are taking action to continue leading in the fight against climate change.@BillGates @Moedas @MarosSefcovic are launching “Breakthrough Energy Europe” – a new investment fund – to help European companies develop clean energy technologies https://t.co/vWIy3uS3kv— European Commission ?? (@EU_Commission) October 17, 2018
Android Creator’s Startup Lets Go Of A Third Of Its Staff
Andy Rubin's startup Essential Products Inc. has let go of about 30 percent of its employees at a time when it is working on a new type of phone that mimics the user and automatically replies for them.
The staff cut has happened in the hardware, marketing and sales division, Bloomberg reported citing people familiar with the matter. The company has about 120 employees according to its website.
“This has been a difficult decision to make. We are very sorry for the impact on our colleagues who are leaving the company and are doing everything we can to help them with their future careers,” an Essential spokeswoman was quoted as saying by Bloomberg. “We are confident that our sharpened product focus will help us deliver a truly game changing consumer product.”
Essential Products Inc. has put aside most of its projects to focus on development of its new kind of phone, which will be much smaller than conventional smartphones. The startup has paused work on a planned home speaker months after they cancelled a different smartphone.
Last year Rubin had launched the Essential Smartphone to great fanfare, particularly among Android purists. The startup spent nearly $100 million on developing the phone. But sales were disappointing due to a steep price tag and technical glitches.
Rubin has been developing phones for nearly 20 years. After leaving Google in 2014, he formed Playground Global, an incubator that has raised about $300 million from the likes of Amazon, Tencent and Redpoint. Essential is part of the same incubator.
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