Eden Farm is a startup with the ambitious goal of building a food distribution network for Indonesia, where many restaurants currently rely on markets for fresh ingredients.
But this means high markups and unreliable supplies for restaurant owners and lower profits for farmers, co-founder and CEO David Gunawan tells TechCrunch. The company, part of Y Combinator’s current batch, wants to help both by simplifying the supply chain, ensuring stable pricing and reducing food waste. Eden Farm currently focuses on fresh produce and non-perishable items, but plans to expand its product line to meat and seafood, too.
The company launched in 2017 and now supplies produce from 60 farmers to more than 200 restaurants in six major cities: Jakarta, Tangerang, South Tangerang, Bekasi, Depok and Bogor. Eden Farm is currently raising an oversubscribed seed round. Gunawan says the target was originally intended to be $1 million, but has now increased to $1.75 million. Investors include Y Combinator and Everhaus.
Eden Farm started as a farm, but while talking to other farmers and researching the agricultural market, its founders realized there were many problems with food distribution in Indonesia.
“Every restaurant in Indonesia faces a huge problem with supply, stability and extreme price volatility,” Gunawan says. “Fruit and vegetable prices can go up and down around 30% to 50% every day. In peak season, for certain commodities, prices can go up ten times, like chilis in the summer.”
Eden Farm tackles the problem of supply and demand with a mobile app that gives demand forecasts to farmers so they can plan their next harvests. Traditionally, farmers don’t sell produce directly to restaurants, Gunawan says. Instead, their harvest goes through several layers of middlemen before arriving at markets.
Eden Farm is able to ensure price stability and also allow farmers to make more profit by purchasing produce wholesale from them. On the demand side, Eden Farm’s value proposition includes quality control. Before produce is delivered to restaurants, it is inspected and washed. Gunawan says restaurants typically have to dispose around 30% of the produce they purchase from markets, but Eden Farm has a 100% guarantee and will refund the price of any produce that is unusable. It also partners with two large markets in Jakarta to help supply large quantities of vegetables and ensure there are enough supplies during peak season. Gunawan says Eden Farm’s quality control can help save restaurants up to 50%.
Eden Farm wants to build a network similar to Sysco, the American food distribution giant, but it has to solve several problems unique to Indonesia.
“We are serving a very traditional industry. Farmers already have their own way of planting and their own culture, which has lasted for generations, and we’re trying to change that,” says Gunawan. “At first we didn’t know how to talk to them, how to convince them, but we learned a lot about how to pay respect to farmers. Every time we go to a village, for example, we know how to present, who to pay respects to, like the elders there. We have to do that before the elders will introduce us to the farmers in the area.”
The company currently handles about half of its deliveries in-house and uses third-party logistics providers for the rest. Most produce is sourced from farms close to where it is sold so it can be delivered in less than 24 hours, but Eden Farms goes further for some vegetables. For example, potatoes are purchased from farms in Central Java, while carrots come from North Sumatra.
Eden Farm works mostly with small, traditional farms, but it also carries produce like lettuce and kale from hydroponic farms. After finishing Y Combinator, Gunawan says the startup will begin focusing on expanding into five new cities: Bandung, Surabaya, Bali, Medan and Malang. As its order volumes increase, the company will begin focusing on smaller markets and once it hits 25,000 restaurants, expand into meat and seafood.
The agriculture industry faces huge problems of sustainability. The world’s population is increasing, leading to higher food demand, but this then threatens increasing deforestation, pesticide use, and some fertilizers that are responsible for greenhouse emissions. Farming can also be a source of carbon sequestration, but how to preserve that? Plus, land quality is being decreased due to over-framing. All this while agriculture has been an underserved industry in terms of technology development compared to others.
So it’s the right time to look at the importance of the “microbiome” in agriculture processes to understand what’s really happening in our crops. The microbiome comprises all of the genetic material within a microbiota (the entire collection of microorganisms in a specific niche, such as in farming ). It’s like looking at your gut bacteria, but for a farm.
Soil contains millions of microbes that all play a crucial role in the health of the crop, and this is why microbes in the soil are an important “biomarker”. Thus, understanding the microbes in the soil can lead to important actionable data.
Today Biome Makers, a technology company that uses advanced data analytics and artificial intelligence to analyze a soil’s ecosystem and provide actionable data-driven insights to farmers, has closed a $4M financing round led by Seaya Ventures and JME Ventures, with participation by London VC LocalGlobe. The financing will be used to keep expanding the company’s footprint across different geographies (U.S., Europe, Latam) and crop types, as well as an assessment system for agricultural products.
The company was founded by Adrián Ferrero (CEO) and Alberto Acedo (CSO), who have previously co-founded a successful startup in digital healthcare and have a strong scientific background. This is the second financing round for the company as it has previously raised $2M from a group of international investors, including Illumina, the global leading manufacturer of DNA sequencing instruments, through the Illumina Accelerator, Viking Global Investors, a leading US-based investment management firm.
Although other companies as Indigo Ag, Concentric, Pivot Bio or Marrone BioInnovations use similar techniques for biome identification, they claim to be the only company providing an open digital service and portal aimed at farmers, in order to democratize the microbiological information that will help them make informed decisions about their agricultural practices.
Biome Makers takes a different approach and looks below the surface. Currently, there are many companies that carry out physical-chemical analysis of the soil, but until now the microbiome dimension has not been taken into account. They say it is a new way of looking at the soil that provides information that had not been taken into account when making decisions in the field.
Fully self-driving passenger cars are not “just around the corner.” While the well-capitalized leaders — funded by corporations, multibillion-dollar VC funds or advertising revenue — are on more stable financial ground, many other full-stack autonomous vehicle startups may be looking for the off-ramp.
With no clear path to funds outside of venture capital, full-stack startups face two options: 1) get acquired for the talent and technology or 2) close shop. Cruise and Argo AI were big startup exits. Daimler Trucks acquired Torc Robotics (which did not follow the VC-startup model). And nuTonomy was marketed as a $450 million acquisition by Delphi/Aptiv.
But the most recent VC-backed valuations for some AV startups have stagnated at or below the $450 million mark, which doesn’t give much upside from their previous valuations in the height of the AV fervor. Without much further upside, it is more likely that many passenger car AV companies will close shop.
Full-stack autonomous passenger vehicle startups are dead.
Passenger car autonomy projects attracted a lot of capital and top talent in the past decade and produced tremendous technological advances in autonomous perception, path planning and control. What happens to the talent and technology when the passenger AV bubble bursts?
Well, there are more vehicles than just passenger cars. The DARPA Grand Challenge held over a decade ago is cited as the catalyst behind the GoogleX self-driving car project and the explosion of passenger car AVs. The advances made during the challenges also spilled over to off-highway vehicles. Since then, autonomous vehicles have been developed and deployed in defense as well as commercially in large-scale agriculture and mining.
It is widely observed that industrial, agriculture, construction and mining applications are better suited for near-term autonomy. There are defined automation tasks with clear ROI, there are fewer human-machine interactions and there are geo-fenced areas that bound the operational and safety requirements. These are simply more controlled environments than on city streets. Automation also can help offset critical labor shortages. It is difficult to attract a workforce at remote mines in the middle of vast deserts. Labor shortages for agriculture add tremendous uncertainty for growers who don’t know if they will be able to prepare and harvest their crops during short time windows.
With the help of those DARPA participants, Caterpillar developed semi- and fully autonomous haulage trucks and announced they have hauled more than 1 billion tons of material. Komatsu followed a day later by announcing that they reached the 2 billion ton milestone. These haulage trucks are the size of a house. John Deere, Case IH, New Holland and others have developed semi- and fully autonomous tractors on their own, and with the help of R&D companies. Most of these programs have been around for more than a decade now, but the rate of technological progress pales to that of the recent startup efforts.
From our vantage point as investors, we believe that we will see a similar spillover from the passenger car AV bubble into industrial, agriculture, construction and mining sectors. This will enhance existing autonomous programs, open up new ROI use cases in those sectors and reshape the autonomous vehicle business model in some of the sectors as smaller players gain access to top talent and technology.
The most significant technologies that will spill over into the off-highway vehicle market are machine perception, reinforcement learning for more complex robotic motion planning and functionally safe, mission-critical engineering requirements.
Perception systems deployed on mining and agricultural vehicles are not as cost-constrained as passenger cars. The price tags for some 700-series CAT haulage trucks exceed $5,000,000. These vehicles are equipped with ruggedized lidar, radar, cameras, etc., mostly for safety awareness. Costs of these systems will decline thanks to the cost-constrained designs for sensors driven by the automotive market.
Camera-based inference will allow these vehicles to further understand elements in their environment — allowing them to perform more complex navigational tasks and operations. Sensor fusion may allow agricultural vehicles to deploy optimal inputs to fields or mining vehicles to understand ore characteristics to increase productivity per scoop.
Reinforcement learning allows operators to “teach” algorithms to perform complex tasks and will create new use cases requiring complex robotic actuation. These use cases could be harvesting more than just broad-acre crops, moving dirt on-site, picking-and-placing of construction equipment for staging and much more. These robotic applications can be integrated on top of existing autonomous mobility platforms.
The most important criterion for these startups is an uncompromising approach to robustness and safety. Autonomy only achieves its full potential if the solution works with minimal downtime and improves safety (which is also tied to equipment replacement costs, worker compensation and insurance).
Recognizing these trends, we’ve made an investment into an AV startup that is deploying autonomous systems on Bobcat skid-steer and excavator vehicles in construction and working with large mining operations to automate all vehicles on the mine site.
We’ve also invested in an early-stage agriculture robotics company automating on-field applications that have been, thus far, untouched by automation.
This is only the start. There are many more opportunities in off-highway autonomy, and we’re continuing our search for companies in other off-highway applications.
The landmark study greatly increases the efficiency of surface delivery of nutrients and pesticides to plants. Currently, when crops are sprayed with stuff that’s supposed to help them grow faster or better, the vast majority of that (up to 95 percent, according to CMU’s engineering blog) will just end up either as concentrated deposits in the surrounding soil, or dissolving into ground water. In both cases, accumulation over time can have negative knock-on effects, in addition to being terribly inefficient at their primary task.
This method, described by researchers in detail in a new academic paper, would manage to improve efficiency to nearly 100% absorption of nutrients and pesticides delivered as nanoparticles (particles smaller than 50 nanometers across – a human hair is about 75,000 nanometers wide, for context) sprayed onto the leaves of plants, which then make their way through the plant’s internal vascular system all the way down into the root system.
Using this method, agricultural professionals could also greatly improve delivery of plant antibiotics, making it easier and more cost-effective to treat plant diseases affecting crop yields. It would be cheaper to delivery all nutrients and pesticides, too, because the big bump in efficiency of uptake by the plants means you can use much less of anything you want to deliver to achieve your desired effect.
This research could have huge impact in terms of addressing growing global food supply needs while making the most existing agricultural land footprint and decreasing the need for potentially damaging expansion of the same.
While the company’s plant-based nuggets present a direct challenge to companies like Beyond Meat, Tyson Foods is playing a different game by introducing consumers to foods that are blended with meat and protein replacements.
So it’s not exactly a direct competitor to Beyond Meat, a former Tyson Foods venture portfolio investment, or Impossible Foods, which are the two current leaders in the growing alterna-beef category.
Rather, it seems to be an attempt to up-sell customers on products with less beef for potentially more money. Tyson did not respond to a request for comment by the time of publication.
For Springdale, Ark.-based Tyson Foods, making alternative proteins is less of an optional strategy and more of a necessary response to what could be an existential threat to the traditional meat market in the U.S. and around the world.
By 2040, traditional meat consumption could fall by 33%, according to a recent analysis by the consulting firm AT Kearny.
Chart courtesy of AT Kearny
“All in all, cultured meat and new meat replacement products are going to disrupt the $1,000 billion conventional meat industry with all its supplier companies,” the study’s authors write. “This disruption is supported by a general shift toward consumption of non-meat proteins (for example, legumes and nuts) as a consequence of new lifestyle trends, all aimed at a more sustainable and healthier diet, as well as regulatory measures against conventional meat.”
Tyson has launched its new brand with just these pressures in mind. The company is the first large meat producer to confront the changes that are coming to the market at anything approaching the scale of the challenge.
What remains to be seen is whether consumers will respond to the concept of a “blended” burger outside of the fast food restaurants where those kinds of products are already served. It’s trying with its premium sausage brand, Aidells, along with the Raised & Rooted patty, which is a blend of beef and vegetable proteins.
“Today’s consumers are seeking more protein options so we’re creating new products for the growing number of people open to flexible diets that include both meat and plant-based protein,” said Noel White, president and CEO of Tyson Foods, in a statement. “For us, this is about ‘and’ – not ‘or.’ We remain firmly committed to our growing traditional meat business and expect to be a market leader in alternative protein, which is experiencing double-digit growth and could someday be a billion-dollar business for our company.”
Tyson’s plant-based nuggets, made from a blend of pea protein isolate and other plant ingredients, will be on store shelves in the fall, as will the blended beef and vegetable burgers.
Tyson also has bets on other, novel meat replacements and alternative protein sources. The company has invested in lab-grown meat makers like Memphis Meats and Future Meat Technologies and is also backing Mycotechnology, a mushroom-based protein producer, through its venture capital arm, Tyson Ventures.
Investors in newly public Beyond Meat seem un-fazed by Tyson’s new offerings. The stock dipped on the news (and a downgrade from IPO underwriter J.P. Morgan), but it’s still up more than 100% on the year.