for the ecosystem Although it covers most of the globe, the ocean has been largely ignored by both startups and investors.
Certainly, a lot of money is spent on the marine industry, but most of today’s marine investments benefit extractive industries such as fishing and oil and gas, or precisely marine ecosystems if not extractive. Not directed to any of the activities such as shipping. .
However, in recent years there has been a major shift in perspective. Founders and investors are beginning to look for opportunities to protect and even enhance marine resources rather than exploit them.
Propeller partner Reece Pacheco said:
With the oceans occupying most of the planet and space being a relative unknown, there are plenty of opportunities for investors to find niches ripe for economic and environmental turnaround.
Sanjeev Krishnan, Chief Investment Officer at S2G Ventures, said: “Energy and agriculture are progressing along the J-curve, while the marine sector is still in its infancy, offering investment opportunities that impact nearly every sector of the global economy.”
In this way, ocean conservation technology mirrors climate technology, which is growing rapidly and, some say, ‘recession-proof’. Of course, there is also the question of whether any sector is truly recession-proof, and that is true of marine conservation technology as well.
That doesn’t mean investors aren’t bullish. Tim Agnew, general partner at Bold Ocean Ventures, said:
Even some of the most difficult and high-profile issues facing the world’s oceans, such as plastic pollution, are prompting investors to dive in.
Daniela Fernandez, managing partner at Seabird Ventures, said: “Profitability and scalability will depend on the approaches and business models in place to solve the plastic pollution crisis. We need to think beyond community beach cleanups. There are highly investable approaches to solving the plastic problem.
Investors like Fernandez are looking at both new problems like plastic pollution and old problems like aquaculture and fisheries management with fresh eyes. In the process, they are betting that innovative approaches to solving these problems will not only generate profits, but will also create disruption and innovation that will spill over into adjacent sectors.
Kate Danaher, Managing Director of S2G Ventures, said:
But she added that there is still room to grow. “We need to appeal to more climate-focused generalist investors.”
To better understand how start-ups and investors think about marine conservation technologies and their opportunities, we spoke to:
- Tim Agnew, General Partner, Bold Ocean Ventures
- Builders Initiative, Program Director (Ocean), Peter Bryant
- Kate Danaher, Managing Director (Sea & Seafood), S2G Ventures
- Daniela V. Fernandez, Founder and CEO of Sustainable Ocean Alliance (Seabird Ventures)
- Rita Sousa, Partner, Faber Ventures
- Christian Lim, Managing Director, SWEN Blue Ocean Partners
- Reece Pacheco, partner, propeller
Tim Agnew, General Partner, Bold Ocean Ventures
What is your investment theme for marine conservation technology in 2023? What kind of growth do you expect in this area?
Our investment themes focus on innovations that modernize seafood supply chains, sustainably scale production and address the impacts of climate change. We believe this investment opportunity is in its early stages and will be a major theme over the next decade. As we learn more about how the ocean can address the climate crisis and impact an increasingly urbanized population.
Marine businesses are in the early stages of adopting new technologies to improve efficiency and productivity.
Is there a meaningful difference between the technology used by coastal-focused startups and technology built for the open ocean?
The answer is yes and no. Shipping and sea breezes are clearly very different animals from kelp farming and climate resilience, but both are moving towards more technology-enabled solutions such as digital technology, artificial intelligence, and data collection and analytics.
Many of the problems facing our oceans, such as plastic pollution, don’t seem very profitable. Is that a fair assessment, or have we been looking at these issues the wrong way?
We’ve seen companies that have a booming business collecting plastic bottles on the beach, sorting plastic types, and selling them to companies desperate to be able to provide recycled bottles and other products.
Considerable research has been done on the transition from plastic packaging to biodegradable packaging. The process of cleaning up the ocean takes time and money, but the potential for a profitable business abounds.
What technologies are most likely to create new markets?
Seafood Traceability Solutions; Ropeless Traps; Microalgae and seaweeds are highly underdeveloped resources with multiple market opportunities. Collection and analysis of marine and meteorological data.
Today’s oceans provide only 15% of the world’s protein and 2% of its calories. What are the possibilities for oceans to provide more resources?
The ocean provides more food with a much lower carbon footprint than land-based animal protein. A shift in demand from beef to seafood could have a significant impact on GHG reductions. Seafood farming, both onshore and offshore, is growing much faster than wild-caught seafood and will become a major source of high-quality protein.
What are some of the key issues facing ocean-based food systems?
Social licensing concerns about aquaculture, species sustainability and the need to broaden consumer preferences to reduce pressure on overfishing.
From aquaculture to kelp farming, there are many options for getting more food from the sea. Which do you think is the most promising?
RAS and closed system aquaculture.
Peter Bryant, Program Director (Marine), Builders Initiative, and Kate Danaher, Managing Director (Marine and Seafood), S2G Ventures.
What is your investment theme for marine conservation technology in 2023? What kind of growth do you expect in this area?
Peter Bryant: We invest in technologies and business models that enhance the conservation, regeneration and resilience of ecosystems, optimize the production and use of ocean-derived resources, and provide consumers with sustainable, traceable and safe food. To do.
Kate Danaher: Part of our paper is that marine conservation technologies can solve big problems for large open ocean industries and adjacent industries. Innovations that can create solutions to deflation such as saving fuel, reducing water usage, or creating diversified revenue streams across multiple industries will help us weather this economic winter, raise capital and gain market traction. is in the best position to obtain
As these types of innovations begin to show commercial results and have a positive impact on the environment, investment in the sector continues to grow, with more ocean-focused funds and broader climate funds is expected to grow in interest.
What role have influential investors played in marine conservation? Investor networks?
Bryant: Within marine conservation there are technologies and entire subsectors that are still developing, requiring patient capital for R&D, reaching product and market fit and possibly creating new markets. . Patient capital enables commercially viable companies to de-risk themselves and provide the runway they need to hit milestones, attracting more traditional capital.
Impact investors have also fueled the growth of the maritime investment landscape by providing initial capital to maritime funds. Prior to 2018, there were only a handful of ocean-focused funds. But in the last 18 months, more than 18 of his ocean-focused funds have been launched.
This is not only because it brings hundreds of millions of dollars of new investment into the ocean, but also because venture and growth equity investors are recognizing the potential of the ocean and willing to establish ocean-focused funds. It’s very exciting because it shows that there is. Impact investors willing to invest early in these funds are playing a pivotal role in raising the capital needed to grow the investment climate in the ocean.
