Investment – Deep pockets The Conservation Fund is in the early stages
of creating a dedicated fund to invest in land based aquaculture assets, from the supply chain to production to distribution, Hankins says. The Freshwater Institute has been devel-
oping aquaculture technology at a facility in Shepardstown, West Virginia, for nearly five years. Since last year, Freshwater’s salmon has been available in Maryland and Virgina through Wegmans grocery stores. ‘There’s money starting to sense that this
is an opportunity and the timing is good,’ he says. ‘We think we’ve demonstrated that it can work. Can it work at a much larger scale? That’s really an open question.’ The Conservation Fund, along with Aq-
ua-Spark, is a sponsor of Fish 2.0, the com- petition for sustainable seafood businesses, now in its second year. There are a range of aquaculture ventures from around the world, both start-ups and growth companies, says Monica Jain, founder of the competition. ‘They all have some innovation associated with their business model. Some are using advanced aquaculture techniques to reduce energy costs, wastes and loss from disease. Others are developing new fish feeds or soft- ware to make fish farming businesses more efficient.’ Jain said the growth in the number and
quality of businesses competing in Fish 2.0 this year, compared to the contest’s first cycle in 2013, is matched by increased interest from investors as well. ‘We are seeing interest in the seafood sec-
tor from a much broader group of investors, in terms of types of capital as well as geogra- phies,’ she said. ‘Many of these investors are considering dedicated investment funds for the sector.’ Mitchell Lench, founder of Treetops Capital
in Cape Elizabeth, Maine, for example, is planning to launch a sustainable seafood fund later this year. He says he has found interest among high-net-worth individuals, family offices, foundations and impact investors in a fund targeting the broader seafood value chain, including not only land based aqua- culture, but also, for example, techniques to capture the value from by-catch and other waste. Lench has already made one investment, in
Acadia Harvest in Brunswick, Maine, which is raising $8 million to build a production facility to grow California yellowtail (Seriola lalandi) -- bringing a sought after sushi fish closer to chefs and home cooks in New England and New York. In March, Acadia Harvest won a $657,000 grant from the National Science Foundation in support of the company’s an- ticipated commercial launch in 2017 or 2018. ‘If you can get the tech down, this has
worldwide application,’ Lench says. ‘You want to be near your market. If you can move this to Minneapolis, if you can do salt water fish outside of coastal areas, if you can get to that model – that’s a game-changer.’
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that this is an opportunity and the ti ming is good
“There’s money starti ng to sense ”
Diversified portfolios Larger funds are eyeing the market as well, not always with an
explicitly sustainable eye. The anticipated growth in the aquaculture supply chain helped Pontos Aqua Holdings LLC, based in New York, raise $75 million last year for investments in raw materials, equip- ment and services, animal health and feeds. Pontos seeks to invest between $5 million and $75 million. Potentially even more significant than the dedicated funds are
the growing number of portfolio investments from broader venture capital funds, largely around food and agriculture, that are investing in seafood and aquaculture businesses as a way to diversify their portfolios. Wheatsheaf Investments, set up by the Grosvenor Estate, a wealthy
Opposite page: Sushi and California yellowtail
UK family, invested $5 million in Enterra Feed Corp in September 2014, to scale up the company’s production of fish and livestock feed based on larvae of the black soldier fly. ‘Wheatsheaf seeks out commercial solutions that contribute to-
wards meeting the growing global demand for food, water and energy in the face of a rapidly changing world population,’ Anthony James, Wheatsheaf’s chief investment officer, said at the time. Enterprises that fit that bill appear to be able to raise significant
rounds of growth capital. Wheatsheaf last year also led a $12.6 mil- lion round of equity financing for San Francisco based BluWrap, which has developed technology to regulate the oxygen exposure of perish- able proteins -- starting with Chilean salmon -- and thus enable fish to be shipped by sea and arrive fresh in destination markets weeks later.
www.fishfarmer-magazine.com
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