By Bay McLaughlin | When I moved to Asia in 2014 on a one-way ticket from San Francisco, I had a hunch that the future of innovation was going to move from the West to the East. My company (Brinc.io) and I invest heavily in Southeast Asia and one of my favorite new investment themes is agriculture technologies (AgTech) or ‘What We Eat’. We have eight investments in this space, so far.
SE Asia is critical to the global food supply – producing 85% of the world’s palm oil and 53% of the shrimp, and home to 96% of the world’s farmers. And while you hear a lot about Asia being a mobile-first economy, this vital industry is fragmented and almost completely offline.
We have unique issues in agriculture coming up – like the need to increase our food production by up to 77% to feed an expected 9 billion people by 2050.
So how do we fix these problems? As I explained in Jumpstart’s last issue, we evaluate all of our investments using the IoT Value Equation that shows the relative impact an investment we make can have on the world.
X (Problem) * Y (Effect) * Z (Duration) = Impact or Opportunity
So let’s run it to see the scale of the opportunities in AgTech in SE Asia and how our portfolio teams reduce agricultural waste and increase yields.
Palm Oil with Poladrone (poladrone.com)
- Inaccurate data results in land mismanagement, creating a 25% inefficiency in palm oil production (X);
- Palm oil accounts for 31% of the world’s vegetable oil production and demand will triple by 2050. Today, palm oil is a US$70 billion industry (Y) annually (Z).
25% (X) * $70 billion (Y) * 1 year (Z) = US$17.5 billion lost in palm oil crops every year! Palm oil production also has some nasty side effects, like deforestation and species extinction.
Precision Agriculture with Habibi Garden (habibigarden.com)
- The Asia-Pacific region has more hungry people than all the other regions of the world combined – more than 550 million. In Indonesia, 54.6 million tons of farmed food is produced (Y) annually (Z);
- Habibi Garden has shown that it can increase vegetable yield by 16% to 200%, while reducing fertilizer and water waste. Let’s take 16% (X) as our conservative estimate.
16% (X) * 54.6 million tons (Y) * 1 year (Z) = 8.736 million tons of food could be produced annually in Indonesia.
Problems and teams like these keep us jumping out of bed each and every morning. If you want to work on similar problems, help unlock data and improve our lives, please reach out. The future is bright and SE Asia has a HUGE role to play… and so do you!
About The Author
Bay McLaughlin, aka BetaBay, is a Co-Founder of Brinc and the COO. Bay is an active Investor with 50+ portfolio companies, sits on the board of four companies, writes a weekly column for Forbes called This Week in ChinaTech, and is a professional speaker and KOL for Huawei and Insta360.