Today, we are pleased to share our latest seed investment in Digital Harvest.
This emerging AgTech platform provides accurate harvesting forecasts, increasing yield and reducing excess usage of water and fertilisers, particularly for multi-year crops like sugarcane, the first the company has focused on.
The team is led byFounder and CEO Young Kim, an experienced founder and executive with an exit under his belt.
Here we share further detail about the primary reasons we invested in Digital Harvest's US$1 million seed round alongside the strategic Singapore-based firm K3 Ventures.
Digital Harvest has developed a “digital twin” model of crops to help farmers optimise complex multi-year harvest cycles. By combining satellite imagery, local weather information and data from each farmer, Digital Harvest has developed a combined biophysical and machine learning model that can accurately predict yield and enable sugar mills to optimise the harvesting from the hundreds or thousands of fields each mill serves. That optimisation allows for greater yield with every additional ton of sugar equivalent to 1.1t of CO2 saved and US$40/t more revenue for farmers.
Our confidence in the trajectory of this early-stage business stems from the calibre and perseverance of the founder and the customer-centric approach to designing and developing the platform.
Sugarcane accounts for over 80% of the world's sugar production and is responsible for providing a livelihood for over 100 million people around the globe (over 25% of the rural workforce in Brazil alone!).
Currently, sugarcane mills employ rudimentary approaches to maximise their sugarcane harvest. Guided by the decisions of their partnering sugarcane mill, the farmers tend to harvest blindly, and generally, a third of their crops at three stages each season to achieve a weighted average.
In addition, sugarcane is harvested via a technique known as "ratooning". The farmer cuts most of the above-ground portion of the sugarcane but leaves the roots and the growing shoot apices intact to allow the sugarcane to recover and produce a fresh crop in the next season.
Crops harvested this way also tend to ripen sooner. However, sugarcane cannot be perennially renewed, so while this saves time in harvesting, there is a stage where the farmer must harvest everything including the roots and replant new ones. The complexity is further increased by the different varieties and growing conditions that create different maturing cycles.
While sugarcane mills employ extension officers to test the crop, they cannot get a birds eye view of the entire field and can only test the edges; the centre of the field often performs differently than the perimeter.
For some companies who manage 5000+ fields, the problems of when and where to harvest, when to replant or when to employ ratooning techniques, all lead to a suboptimal harvesting schedule.
At the same time, more frequent extreme weather events mean that a lot of historical or intuitive harvesting approaches may become increasingly difficult. Avoiding huge losses through precise and scientific data is an additional but critical element of Digital Harvest’s value proposition and aligns well with the Climate Tech Fund’s view on the importance of adaptive climate technologies. Solutions that allow us to better adapt to a climate impacted world are essential as we find and implement ways to reduce emissions.
A biophysical-”digital twin” model combined with A.I.
Digital Harvest has developed a biophysical-”digital twin” model for sugarcane, combined with an AIgrowth model of the crop. Thanks to a partnership with the largest sugar company globally, US Sugar, Digital Harvest was able to build this model on 50years of historical data. This was complemented with data from sugarcane mills and farmers over the globe, including some large US and Indonesian-based customers.
As a result, DigitalHarvest can provide its customers with the solution that directly solves one of the industry’s biggest problem: accurate predictions to maximise their sugarcane yield across the entire multi-year harvest schedule.
This is not limited to customers with extensive data either. Digital Harvest can work with customers with just a year's worth of historical data with a solution that gets more accurate over a 3-5 year cycle. Additionally, it works in all geographies, including Brazil, Guatemala, Mexico, India and more, making Digital Harvest a truly global company.
Lastly, while sugarcane is the current focus, Digital Harvest has ambitions to develop solutions across other crops.
Dale Carnegie, the author of How to Win Friends and Influence People, is attributed to saying that"flaming enthusiasm, backed up by horse sense and persistence, is the quality that most frequently makes for success." The pathway from the initial idea to now hasn't been straightforward for Digital Harvest. It reflects Digital Harvest's founder, Young Kim’s, strong will, customer-centric focus and perseverance.
After initially setting out to develop drone solutions for crops, Young moved through multiple design iterations, over several years, before landing on the platform we now know as Digital Harvest.
As early-stage investors, our investment decisions over index on a company’s founding team; do they have the skills necessary to find customers, build products, overcome setbacks, and persevere. We knew we found a strong founder when we heard the story of Digital Harvest and got to know Young: a former Air Force Officer, previous founder with a successful exit, and executive.
At Investible, we pride ourselves in bringing genuine support and value beyond money to every startup we back. We primarily invest in pre-seed and seed stage startups because that’s where our expertise lies, and where we can drive impact.
With offices in both Sydney and Singapore, we focus predominantly on the Asia-Pacific region How ever we do have a global mandate and consistently review investment opportunities from across the globe. Occasionally we find outstanding companies outside of our region for which our team and our network—including members of Club Investible—can bring that added value.
We look forward to working with Young and the Digital Harvest team as they expand their solution through South-East Asia and Australia.
The Investible group of companies includes various entities who are corporate authorised representatives (CAR) of Boutique Capital Pty Ltd (BCPL) AFSL 508011. The full list of entities are detailed below/via a link.
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