Aqua-Spark, an investment fund focused on sustainable aquaculture and related technologies and services, recently invested USD 4 million (EUR 3.5 million) in two up-and-coming aquaculture firms: Menlo Park, Calif.-based Calysta and Chicoa Fish Farm in Mozambique, Africa.
Based in the Netherlands, Aqua-Spark was co-founded in 2013 by entrepreneur Mike Velings and Amy Novogratz, former director of the TED Prize. SeafoodSource recently caught up with Velings to discuss why the investment fund believes in its current projects, and how much money it will be investing in global aquaculture in the future.
Blank: Why did you and Amy Novogratz believe there was a need for aquaculture industry funding?
Velings: I have been an entrepreneur since I was 18 and have been an investor in the United Kingdom for several years. We met each other on Mission Blue, a floating TED conference in 2010 that was organized around the TED Prize awarded to Sylvia Earle. One hundred scientists, investors, celebrities, concerned citizens and NGOs joined forces to see what they could do for our oceans. Amy was running the TED Prize program back then. We both got really inspired and started looking for a way to contribute and build something that could last. In our search, we came across the work our partner WorldFish is doing (promoting aquaculture to get people out of poverty), which got us really excited. Ever since, we have been building and constructing what is now Aqua-Spark.
Tell us more about Calysta, which has developed a high-protein, fermented microbe fishmeal ingredient.
Velings: One of the things that make Calysta special is that it grows microorganisms, single-cell proteins on methane gas. It is a technology developed by DuPont and another company 15 years ago. It couldn’t be made profitable back in the day because of the costs of methane gas and fishmeal. The product that comes out of it has extremely good qualities; it is one of the best fishmeal product alternatives in terms of nutritional characteristics. In the past, Calysta produced 5,000 or 6,000 [metric tons] of fishmeal that was used in salmon production. The plan is to rebuild Calysta’s factory and expand in a big way. It has been approved for the European Union and there is a considerable interest from a number of parties in the marketplace.
Tell us more about why Aqua-Spark invested in Chicoa Fish Farm.
It is a tilapia farm close to Malawi and Zimbabwe. They are going to build their own feed mill and hatchery and will also ideally use the Calysta product in the future in their feed, especially since they can make their own feed. Chicoa is a first step toward a broader Africa strategy. In Africa, we want to invest in at least four tilapia farms across four different regions. We want to create enough scale to put a dedicated team on it to work on it, to optimize their breeding program and everything else. Ten years from today, the goal is that the four farms would produce 40,000 to 80,000 tons of tilapia annually and supply local farms.
Africa is an area where there is a huge need and huge shortage of accessible, healthy protein. The average consumption of fish in Malawi has gone down because the [wild] fisheries are going down and there really is no alternative. There is demand for fish in Africa — 1.6 million tons — which means the need is bigger than almost any other place on the planet.
What are Aqua-Spark’s future investment plans?
We raised 10 million USD (EUR 8.8 million) last year. We expect to invest most of that by summer, and we are raising an additional USD 10 to 15 million (EUR 8.8 million to 13.2 million) by July to invest in the second half of 2015. By the end of year, we hope to make another eight to 10 investments.
Our long-term goal is to build an ecosystem of companies that benefit from each other, including technology, farming, feed alternatives, feed production and disease-battling technology. Ten years from today, in our mind, we will have up to 60 to 80 portfolio companies with EUR 250 to 300 milion (USD 283.7 million to USD 340 million) in investments.
