Food Innovation

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>>> Venture Capitalists Are Aiming to Disrupt Fish Farming


Bloomberg

By Priya Anand

May 13, 2022


https://www.bloomberg.com/news/articles/2022-05-13/fish-farm-startup-hopes-deep-ocean-technology-can-fuel-growth?srnd=premium


Off the western coast of Panama, near a town called Puerto Armuelles where Chiquita Banana once had a major presence, Forever Oceans is preparing to harvest and sell almost 3 million pounds of yellowtail to sell in filets or for sushi. While the eight-year-old startup’s product is seafood, its executives spend a lot of time talking about the innovation that goes into the floating cages where its fish spend their lives. The company will succeed, they say, because it has improved the core technologies, from specialized enclosures to sensors and robotics, needed to raise large amounts of seafood farther out in the ocean than traditional fish farms.

Investors’ hunger is increasing for startups with big plans for food. Venture capitalists plowed more than $39 billion into food-related tech companies in 2021, double the amount they put into the sector the year before, according to Pitchbook Data Inc., a research company. More than half that funding went to digital grocers and online marketplaces, natural targets for investors accustomed to assessing software companies that build consumer products. But there’s also growing interest in sustainable food production. Fish farming, which grew 527% from 1990 to 2018, according to the United Nations, is poised to become an even larger part of the supply chain. The UN said in a 2020 report that about 34% of fish stocks were overfished. According to the World Bank, the figure is much higher, at 90%.

To venture investors, this looks like a strategy for innovative businesses that can be both lucrative and environmentally useful. “Two-thirds of the world is covered by the ocean,” says Bruce Leak, co-founder and general partner at the venture capital firm Playground Global, who hasn’t invested in Forever Oceans but sees deep-ocean aquaculture as a potentially valuable area. “That’s where mother nature raises the fish we eat, which we can no longer sustainably catch.”

But there are serious questions about whether fish farming is itself sustainable. Aquaculture operations can dump waste and pesticides into ecologically important waters. And they run the risk of infecting local populations with sea lice or viruses and damaging local ecosystems if farmed fish escape. Aquaculture operations taking place entirely on land reduce some of these concerns, being more insulated from natural ecosystems. Forever Oceans says its plan to locate facilities in deeper water farther from shore is also a more sustainable alternative to siting the farms in coastal waters.

The company, based in Gainesville, Va., has raised almost $120 million—one of the highest totals among venture-backed fish-farming companies—from Bessemer Venture Partners and other investors. In addition to its operations in Panama, the company has government approval to begin working off the coast of Brazil and runs a research facility in Hawaii.

Forever Oceans has only produced about 110,000 fish so far and already seems to be tempering expectations for its inaugural harvest. In an interview in April, Chief Executive Officer Bill Bien said the company would have a fall harvest this year of at least 1 million fish. A company spokesperson later walked that back to 450,000, saying Bien may have included next year’s harvest estimates in his projection.

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