Agriculture Archives - Artemis Water Strategy

Apr 02 2018

Where is the Eden app for farmers?

Pictures are part of Walmart’s secret sauce in Eden’s ground-breaking user-interface for food inspection.

Last month, we had one of the first public views of Eden, Walmart’s suite of produce management applications. Eden may be one of the most ambitious efforts to harness the power of food data. An internal application aimed for use by Walmart’s associates, it addresses the three critical challenges that have been holding back the use of supply chain data. Eden might offer an important model for farmers using big data at the other end of the supply chain.

1—First and foremost, Eden distills a mountain of data— combining the latest information from Walmart’s distributors with USDA food product specifications and Walmart’s own product standards. Walmart has used more than a million photos to create what it calls a “freshness algorithm” that prioritizes the flow of perishable goods from farm to store. Industry analyst Dan Alaimo writes that Eden provides a framework for integrating existing data flows from the supply chain. Today, Eden tracks a continuous record of storage area temperatures and temperature control devices on trucks. According to Parvez Musani, Walmart’s Vice President of Supply Chain Technology Engineering at Walmart Labs, the technology will soon tap into data from the farms of Walmart’s suppliers. “We’ll have drones flying over the farms” to monitor temperatures and other factors that determine the quality of the produce Walmart is getting from suppliers, Musani said. For example, bananas, one of Walmart’s most popular items, travel from seven countries in Latin America to over 4,000 stores in the U.S. In the future, Eden will be able to track storage temperature during transport, recalculate the freshness factor and re-route the shipment.

2—Eden structures and prioritizes data: Walmart has defined a data ontology that drives mission-critical day-to-day operations, from tracking food safety to delivery schedules. The Eden system is designed to learn, comparing images scanned in the field, at a distribution center, or a store with a library of acceptable and unacceptable samples in the database. With Eden, Walmart aims to estimate an exact shelf-life for each product.

Eden is a major investment and presents some business risk as well as business opportunity. Computer-driven produce management may miss details that long-established manual processes track today. No doubt Walmart will need to track operational issues that emerge with the new system and invest to develop data sources.

3— Eden is a pioneering application because is aims to provide this complex store of data to a massive population of associates throughout Walmart stores in the US. “Eden leverages sophisticated technologies such as machine learning, but we’ve made it simple enough for all of our associates to use, “ notes Musani. Employees at Walmart’s distribution centers use Eden on handheld devices to create a digital record of defects and remove produce that doesn’t pass USDA and Walmart quality requirements.

Since it deployed Eden to 43 food-distribution centers in January of 2017, Walmart estimates that it has saved $86 million in food waste, according to Musani. Over the next five years, Walmart aims to save $2 billion in food waste. Reliably stocking high-quality produce might be a major competitive advantage over other grocery retailers.

“Shoppers frequently make their harshest and sometimes final decisions about the desirability of a grocery store based on the quality and freshness of its produce. It’s often their first and most lasting impression,” notes Alaimo. Big data offers massive efficiencies to grocers, but its value is proportional to the degree to which Walmart can deliver insights to the associates on the front lines, in the stores, in the distribution centers, in the merchandise buying groups.

As farmers decide when to plant, spray, irrigate and harvest, they need to consider data on weather, soil, historic yields and market pricing. On a single screen, Walmart’s Eden shows weight, defect grade, size, and temperature, with easy access to detailed reports. Which agtech company will develop the Eden app for growers?

Quality produce is a decisive element of retail success today. Credit: Walmart

Jan 31 2018

Tracking the Emergence of the New American Farmer

As American farmers struggle through the fourth year of a historic dip in world grain prices, they’re increasingly looking to urban tech geeks in places like the Silicon Valley for answers. Last week at the Cleantech Forum, agtech leaders gathered to consider what solutions will rise on the 21st Century farm: Wade Barnes from Farmers Edge and Chris Paterson from Bayer Crop Science joined Analog Devices blockchain project lead Rob O’Reilly and Chuck Templeton from S2G Ventures.

Innovations in sensors, communications, and AI are bringing Internet-of-Things (IoT) solutions that were first developed for sophisticated manufacturing to precision agriculture.

Data and communications technologies give farmers access to a flood of data about their farms. Hyperlocal data on moisture, soil, and temperature can help growers increase yield, minimize the use of costly fertilizers and pesticides while giving them the agility to respond to unpredictable weather. The largest and the most sophisticated farms are showing that agricultural technologies raise farm yields and profitability. Retailers and specialty food producers are paying premiums to monitor the status of crops before they are delivered. With these early successes, venture investment in agtech is rising. More money went into funding agricultural technology start-ups last year than the previous two combined, but they continue to be cautious about the potential for selling technology to farmers like those in the US. How many of the 2 million US farms will join the 21st-century agtech revolution?

The battle for the hearts and minds of US farmers will center around helping them get beyond data collection and analysis into action. How can they get beyond a sea of data and get out to their fields? How can they lock in profitable crop sales with data without compromising their operations? According to the latest US census, the largest 10 percent of US farms own more than 70 percent of cropland in the United States; the top 2.2 percent alone takes up more than a third. The tiny three percent of the 2.04 million US farms that are considered large account for 42 percent of the production. Experts estimate that today large farms can extract nearly four times the value of production of major arable crops or principal livestock breeds per acre that small farmers can. Although 75 percent of farms do not generate enough revenue to cover costs, more than 60 percent of the largest farms can boast margins of more than 20 percent.

As agtech companies grow beyond early adopters, their success will depend on how they can help the 97% of farmers battling to survive consolidation. Farmers are looking for data management solutions that seem to match the DNA of Silicon Valley start-ups, bringing complex data streams to streamlined consumer applications like Google Maps, Zillow, Mint or Venmo.

“We’ve created a scalable solution that works for our global network of growers and one that can be tailored to support the needs of individual fields, from grain production in Brazil to variant weather in Australia. Predictive forecasting models are the next step towards achieving higher global crop yields, sustainably,” notes Barnes from Farmers Edge.

For agtech start-ups to succeed, they need to reach beyond the farms with multi-million dollar combines and tractors.

What would be the value of a technology that would provide a single dashboard to help growers get out of the office and into the cab of their tractors? What would it take to bring a mass migration of growers to adopt that platform? Would that opportunity provide the 10x returns on investment that define the sweet spot for venture capital investment?

Jun 01 2017

Is Agriculture IoT a Ripe Target for Softbank’s Next Big Windfall?

In his career finale, a pioneering investor aims to lead a massive shift in communications.

Last week, Japanese investment giant SoftBank announced that it had closed $93 billion in committed capital for its massive Vision Fund, putting it within striking distance of the $100 billion target it announced last year. The Vision Fund dwarfs even the world’s biggest private equity vehicles, including the $22.5B mega fund that Apollo Global Management announced last month set to have been the largest in recent history. The Vision Fund would exceed the size of the five biggest private equity funds combined, according to investment research firm Pitchbook.

ARM acquisition provides a launchpad into IoT

Since the Internet boom of the late ‘90s, Softbank has set the pace for tech investing, betting huge sums to chase the rapid growth of the Internet, then retail distribution via online portals. It has made tens of billions in returns from investments in companies from Alibaba, to Yahoo and Supercell Oy. The first closing of the Vision Fund comes just three months after Softbank’s founder, Chairman and CEO Masayoshi Son made the biggest bet of his career with the $32 billion acquisition of chipmaker ARM Holdings Plc. ARM provides technology for 95% of all smartphones and seems poised to play a central role in the emerging “Internet of Things” (IoT) market that will network devices, vehicles, and buildings via remote sensors and processors. “ARM will be the center of the Internet of Things, in which everything will be connected,” he told reporters. “IoT is going to be the biggest paradigm shift in human history (and) we have always invested at the beginning of every paradigm shift.”

Ambitious vision set to shake up the investment community

Softbank’s Vision Fund is rumbling the investment community because of its size, but also because of its ambitions. It is the cornerstone for Softbank’s founder, Chairman and CEO Masayoshi Son’s final mission for Softbank to bring Japan’s third largest company to a new level of global leadership. Last year, Son decided to postpone his retirement to “work on a few more crazy ideas.” “I feel my work is not done,” he stated. Mr. Son said. “This will require me to be C.E.O. for at least another five to 10 years.” According to Bloomberg, Son has laid out a 300-year plan to make the company the most valuable in the world.

Historically, SoftBank invests in a range of businesses, from established players to tiny start-ups. Recent examples include a $130 million in the biotech startup Zymergen, $5 billion to Chinese Uber competitor Didi Chuxing as well as big bets on co-working space provider WeWork and India’s Paytm, a mobile payments company.

Venture capital vehicles, known for making the types of tech investments the Vision Fund is targeting, are typically even smaller than the giant private equity funds. For example, Technology Crossover Ventures’ 2007 fund VII was one of the biggest in history at only $3 billion. Only a small group of the hundreds of venture funds have established vehicles that total more than $1 billion.

Which markets will bloom with Vision Fund investment?

Industry observers wonder whether a behemoth investor of this size with considerable technology synergies will hit the ecosystem of venture investment like an asteroid landing on a desert island. According to analyst Kyle Stanford, the specter of price inflation for early-stage investments is already haunting the investment meetings at venture firms. “The fear is all rooted in the 2014, 2015 investment environment, where there were tourist investors and valuations were getting out of control, and when valuations get too high it limits exit opportunities,” Stanford explains. “When you see a fund of $100 billion coming in already making big headliner deals, I think that fear is going to come back.”

Those headliner deals depend on a healthy crop of well-financed growth stage deals, which have been on the decline even as overall investment activity has picked up, with first financing activity falling for seven consecutive quarters.

First financing activity has fallen for seventh consecutive quarters

Source: Pitchbook

The

Source: Pitchbook

Over the short term, competition for top tier deals will heat up startup valuations, but the Vision Fund is also bound to have a profound impact on the kinds of technologies that get to market and their pace of development. $100 B in ambitious capital will drive investors to expand their investment activity to new technologies and markets.

Riding, and driving the food tech wave

Telecom giants like Softbank are diversifying beyond their core industries through acquisitions in areas that lead to synergies. BT launched a sports TV channels venture and Norway’s Telenor opened an e-bank. From its base in Japan and with domain expertise in telecommunications and hardware, Softbank will be looking for technologies that are riding dramatic market trends.

One candidate is precision ag. With its ambition, its vision and it’s unique perspective as a Japanese company, Softbank seems set to play in the next chapter of the telecommunications revolution– beyond the internet, beyond urban networks to address the big challenge of feeding a population of 9 billion.

By 2050, 14 of the world’s 20 biggest metropolises will be in Asia and Africa, including Jakarta, Manila, Karachi, Kinshasa and Lagos as well as Tokyo, Shanghai. and Mumbai, according to a projection by Demographia. It takes about 1 acre to feed the average U.S. consumer. China only has about 0.2 acres of arable land per citizen, and an estimated 20% of that land is contaminated with toxic pollution. As a result, Chinese have been investing aggressively outside of China to produce food for their home market. High profile purchases include Australia’s biggest dairy operation and US-based Smithfield Foods.

Precision agriculture is a “must win” market for IoT leadership

As the world’s population grows, outright purchase of existing food production facilities will not suffice. Technology will be essential to feed burgeoning populations. Precision agriculture will be more than enabling technology, it will be essential for survival; to feed an increasingly crowded planet. This will be a “must win” flagship market for major technology and communications companies, from Intel and Softbank’s ARM to communications companies like Softbank’s Sprint, Verizon, BT and Telstra.

Jun 17 2015

Which solutions can respond in time?

Courtesy of National Oceanic and Atmospheric Administration

As California counts its water reserves in months, which “shovel ready” solutions can help it respond?

More than $320M of California’s emergency drought relief funds were left unspent a year after they were approved, according to reports from the California State Finance Department released last week. As the State starts a grim countdown to the limits of its reservoirs, the timeframes on the California water crisis has suddenly shifted from years to months, California’s water system has been built with 25 year capital plans, where even the fast-track water projects take 2 to 6 years to complete.

“We need to get the money out the door now for shovel-ready projects and existing water programs that only need funding to get started. No delay. No red tape.” California Senate President pro Tempore Kevin de León (D-Los Angeles) stated back in March.

While the State scrambles to keep water running, water tech innovations that are both “shovel ready” but also built for plug and play installation are gaining attention. Laura Shenkar from Artemis joined Frances Spivy-Weber, Vice-Chair of the State Water Resources Control Board, Lance Donny, founder and CEO of OnFarm, Mike Lord, vice president of engineering for Effluent Free Desalination Corp (EFD) and Robin Gilthorpe, CEO of WaterSmart on June 5 to discuss some examples on public radio, the KQED Forum.

Oct 22 2014

In California, water is not for the faint of heart

Facebook COO Cheryl Sandberg, former Treasury Secretary Robert Rubin and California Governor Jerry Brown made a unique appearance on Monday at Stanford University.

“The answer is not to go back to a presumed utopia, we’ve got to manage what we have. In a state of 38 million people, we’ve got a management challenge that will take all of the innovation, collaboration and magic of the marketplace.”

California is a “canary in the coal mine” for the world as the state faces an unprecedented drought, combined with new reductions on its critical water supply from the Colorado river. Water scarcity is devastating the economies of the Western US: California agriculture lost $2.2 billion in 2014 alone Texas has lost $25 billion since 2011 because of drought, and Las Vegas is spending $1 billion for a third pipe and a lower level into Lake Mead to tap into its dwindling waters.

There is a fundamental mismatch between the US water infrastructure and the water services requirements for the next decade. As water supplies dry up, water pollution will become more concentrated. In order to tap into the estimated 5.2 to 7.1 million acre-feet of water supply from storm water and reclaimed sewage, California will need to build a second water utility system– onsite and community water systems. The state will need to move fast to set policy and monitoring for these remote systems.

If he wins in November, Brown promised to “put water up front and center.” With over a century of brutal politics around water, California water policy is not for the faint of heart. In what many expect to be Brown’s last term in office, changing the face of California water would set a promient place Brown in the history books.