Investment – Deep pockets
BY DAVID BANK
Deep pockets T
Why dedicated funds and high-net worth individuals are targeting fi sh farming
he hook is baited and private equity and venture capital fund managers are reeling in capital to finance next generation fish farming enterprises across the country and around the world. Several dedicated funds are targeting aquaculture invest-
ments specifically. At the same time, many broader venture capital and private equity funds, focused on food and agriculture and even technology, are adding investments in wild caught seafood suppliers, processors and consumer brands, as well as aquaculture, to diversify their portfolios. Even some public equities investors have added oceans related
investment strategies; Rockefeller & Co, for example, is betting that increased regulation around ocean health will increase the value of sustainability based ocean assets. The result is a clear uptick in investor interest and available cap-
ital for enterprises targeted at the sweet spot of the food market -- healthy, sustainable, tasty fish. ‘The whole spectrum of investors are approaching us,’ says Amy
Novogratz, managing director of Aqua Spark, a Dutch based fund that closed on financing of €10 million (about $11.25 million) last year. Aqua Spark has invested in Chicoa, a Mozambique fish farming op-
eration, and Calysta, a California biotech company that uses microbes to produce a fishmeal substitute. The fund expects to close four more
investments in the next several months. Novogratz says fundraising has accelerated
for this September’s anticipated close on an additional €10-15 million. ‘People see the numbers. They realise the
forecasted growth.’ The US imports more than 90 per cent of its seafood, a supply that will become more constrained as global demand rises and wild caught production peaks or declines. By 2030, according to the World Bank, aquaculture will supply two thirds of global fish consumption, or 93 billion tonnes, up from 53 billion tonnes in 2008.
Dedicated funds That is driving growing interest in efforts
to replicate farmed fish production facilities close to large consumer markets across the country. New technologies for filtration and new feed stocks are helping prove out the proposition for land based, recirculating aquaculture systems, or RAS. Proponents say such facilities can overcome some of the problems, such as disease and escapes, that have hurt some open ocean aquaculture operations. Without the vagaries of wild catch opera-
Left: Fish farming
tions or even open ocean aquaculture, the emerging land based aquaculture model lends itself to private equity style owner operator model that can be predictably mod- elled, financed and rolled out at scale. ‘This does become a pretty predicta-
ble model,’ says Joe Hankins, director of the Freshwater Institute, a project of the non-profit Conservation Fund. ‘It’s pretty cost-competitive now. If you add
in sustainability, the carbon footprint, trans- portation costs, consumer interest, this could be attractive to investors.’
www.fishfarmer-magazine.com 13
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