Lessons of the Week
What I learned this week….
World Agri-Tech was busy. I learned a lot without buying a conference ticket. I met with about 40 people, each for 20 minutes, each working on Food is Health. We also hosted a really interesting regenerative ag “Meet-Up” with 25 people across the supply chain. All focused on nutrient density and farmer profitability. That will lead to a lot of new business opportunities for those in the meeting. Thank you, Brad Fruth and Becks, for hosting this meeting.
But next year, we really should run a session at the conference on the roadmap to Food is Health, following the lead of our friends at Aimpoint. Their work on Farmer of the Future is leading the industry. Our approach will describe our roadmap to Food is Health. 1000s of startups will cure these problems as we collectively eliminate $14T spent each year globally on the healthcare cost of poor nutrition.
A key consensus from other investors at the conference is that into 2025 the bulk of thoughtful investing will be around growth equity and integration around durable platforms. This is actually a good thing for Food is Health and Regenerative Ag. But frustrating for early-stage startups. We likely have use for $100B of investment globally per year to achieve the broader shift to nutritional density, regen, and food is health. If you are a student of Rebecca Henderson (or a Sloan MBA grad) you are thinking through the dynamics of innovation, Solow, Creative Destruction, standards, architectural innovation, etc. Trying to find the right places to deploy capital.
These weekly “Lessons learned” are intended to break down the big problem of Food is Health into smaller opportunities. They are the product of many conversations. While they contain a lot on carbon recently, iSelect’s focus is nutrition density and metabolic disease. How should I shape these weekly emails to help you speed the diffusion of technology.
The list is longer this week, given the SF conference.
Microsoft has to offset more carbon than Exxon. Microsoft and the other AI firms share a common purpose with farmers: improving soil health.
But, avoid business models that require carbon offsets.
Carbon insets may be different if they accelerate Food is Health. And consumers prioritize food to achieve health.
The bulk of US ag production is from 85k farms, which will go to 60K over the next 20 years, each getting bigger. And reducing the need for many service providers in agriculture. (See Aimpoint)
Customers are slow to adopt better technology if they do not understand how to use it. Adopt the SaaS concept of “Customer Success” programs.
Technology alone is not a competitive advantage. You need to pair knowledge with technology to speed diffusion. (Matt Clancy)
Birds and the Bees: Obesity reduces fertility. Ozempic babies are happening. Do we really understand why global fertility is dropping?
Humans have been fasting for 300k years. A recent study suggests that without foundation, fasting increases cardiovascular disease. It might be a circadian programming influence on insulin spikes.
We need the equivalent of the Human Genome Project for nutrition. An insilica model of human nutrition.
Who will be the Palantir of nutrition density for CPG and Grocery? I am not telling.
The AgTech exit window is still closed, likely into 2025; the first exits will be biological inputs - protection and enhancement. Driven by South American traction.
Who is the Computer Associates (CA) of AgTech? Rolling up small biologics companies into a platform is maybe a good start.
Don't fight evolution, it has a 4.5B year head start. No human cares more about soil health than farmers and ranchers. None.
Best returns may come from companies that exhibit: customer centric product, track record of iteration and experimentation, and the ability to solve acute customers pain while driving deflation with innovation.
Hedonic pricing: A medium cup of black coffee at World Agri-Tech is $7.01. You now know who is making money in Agritech.
If you have 40 intense, 20 min meetings, over two days at a conference you can not remember your name even three days later. Especially after fasting for a week and without enough affordable coffee.
Some Conclusions
In late April, I will testify in DC on a panel shaping the federal strategy for Food is Medicine and Food is Health. We will discuss the Healthcare cost of poor nutrition. My presentation will focus on the opportunity.
In 2000, the Human Genome Project fully sequenced the human genome at a cost of $1B. That effort, shaped in Boston, St. Louis, and San Diego, laid the foundation for thousands of startups. One of those, Moderna, transformed the global response to COVID. Thousands of others have delivered similar results in immunotherapy, vaccines, and other sectors. The global healthcare system was transformed because of US leadership on the Human Genome. A feat matched by crop genetic breakthroughs in the 70s and 80s, ending global starvation. And, of course, the Apollo program.
The next step is the Human Genome for nutrition. We still do not understand the dynamic of something as simple as diet. Do we lose weight because of calories or the insulin model? Does fasting cure obesity or increase heart disease? The FDA and USDA regulate our food system and, by extension, the nutrition system. The nutrition system has raised healthcare costs every year for the last 50 years. Our food system is a gateway drug for healthcare. Why?
If the US spends $1.9T on the healthcare cost of poor nutrition, then NIH and USDA should certainly consider creating a large-scale longitudinal study on human nutrition—the Human Genome Project of Nutrition. Perhaps they could track 100,000 people over many years, building a “Digital Twin” of human health from observational studies and insilica models of human nutrition. People could donate their data to science, breaking the wall of HIPPA. This would build on the Rockefeller Foundation's effort around the Periodic Table of Food, an effort to catalog the nutrition of every crop in every country. 1000s of crops for which we have no nutrition profile data.
If this notion interests you, please reach out to help think through the approach.
Nutrient Density Tech Stack
What is clear is that as CPGs are pressured by GLP-1, inflation, and climate, they are realizing they need to think about nutrition engineering. How do they deliver a tasty, affordable product at scale while being healthy and adapting to Food is Medicine? Are new customers “Worried Well” or Medicaid patients with meals paid by CMS?
CPG and Grocery will quickly realize these risks and form the foundation of an opportunity to eliminate the $14T spent globally on the healthcare cost of poor nutrition.
The “Tech Stack” to nutrient density and Food is Health includes:
Holganix - Soil Microbiome
Kula Bio - Nitrogen Fixation
Brightseed - Engineering micronutrition
Benson Hill - Genetics
White River Soy - Mini Mill
Edacious - Nutrient density optimization
Bushel - Financial Services and payments
The tech stack will expand to include additional platforms for financial services, human health, and insilica models for soil, human nutrition, and animal nutrition.
On X…
Medical schools probably spend more class time teaching social justice sensitivity when doctors could achieve more social justice through nutrition.
Harvest costs as a percentage of sale: Grains, around 4-8%. Forages, often 1/3. Specialty crops, sometimes 1/3 to half. What innovations will eliminate these costs? Let Casey know if you have any good ideas.
On Substack….
Technology alone is not a competitive advantage. You need to pair knowledge with technology to speed diffusion.
Humans have been fasting for 300k years. A recent study suggests fasting increases cardiovascular disease. It might be a circadian programming influence on insulin spikes. Very interesting and unexpected.
Weeks Charts
Don't fight evolution, it has a 4.5B year head start. Farmers and Ranchers understand this better than anyone.
Is Ozempic reducing obesity and improving fertility, or improving how people feel and improving shots on goal?
Why has the murder rate varied so much?
AgTech's Tech Stack is something I had never thought of before. Seems like many disparate pieces at this point, the idea of a Computer Associates to strongly supplement this seems like an open gap in the market.
Everything you are suggesting that we should be investing in will do nothing more than accelerate the creative destruction that has been happening to our agri-food system for the past 70 years. The numbers speak for themselves. "The bulk of US ag production is from 85k farms, which will go to 60K over the next 20 years, each getting bigger. And reducing the need for many service providers in agriculture."
Instead start thinking about creative construction. Invest in people like the1.6 million farmers who need nurturing and capital to expand regenerative practices and operate profitable farms while they rebuild soil health, save and purify water, grow nutritious whole foods. Support those entrepreneurs who will help build local food systems and restore our rural communities and those who seek to improve human health through guiding people to eat healthier nutritious food.