2023 was the hottest year on record. Temperatures are unlikely to drop for some time. Rising temperatures have made farming increasingly difficult, with heat and drought severely impacting crops in areas that were once major agricultural resources.
For most farmers who rely on traditional methods and lack access to high-tech greenhouses, the need for adaptable and ready-to-use solutions is paramount. Agritech companies such as Iyris, based in Riyadh, Abu Dhabi and Delaware, are participating. The startup, which provides a lifeline to farmers and helps them navigate climate change through agricultural solutions, announced a $16 million Series A investment. Funding round.
Chairman John Keppler said in a conversation with TechCrunch that providing Iyris with the dry powder “helps us continue to expand and grow our business, which addresses the incredibly difficult challenges of growing fresh produce and increasing crop yields in the face of climate change and rising climate change.” He said. Temperature, heat, drought.”
San Francisco-based climate and sustainability fund Ecosystem Integrity Fund (EIF) led the round, along with Global Ventures (which also invested in the company's $10 million seed round led by Aramco affiliate Wa'ed) and Dubai Future District Fund. (DFDF) also participated. ), Kanoo Ventures, Globivest and Bonaventure Capital.
While much of the climate technology field focuses on expensive, powerful technologies that are suitable for specific purposes but difficult to adopt, Keppler says Iyris is aimed at the low- and medium-tech world. Farmers in this sector use protected farming methods such as polyethylene mulch, acrylic, shade nets and screens to mitigate the environmental impact of large-scale crop production. Keppler explained that these methods include fields and tunnels to be more accessible and practical while limiting ecological damage.
Advancing commercial agriculture in hot climates globally
Iyris originated from innovative technologies developed at the King Abdullah University of Science and Technology (KAUST) in Saudi Arabia. It was co-founded by CEO Ryan Lefers, an agricultural engineering expert. plant scientist Mark Tester; Formerly Red Sea Farms in 2018, the company first grew and sold tomatoes in Middle Eastern countries using heat-shutdown technology, before commercializing the technology and selling it to other farmers.
Iyris' flagship technology, called SecondSky, involves adding additives to polyethylene manufacturing. The additive blocks near-infrared rays, significantly reducing heat, while allowing photosynthetically active radiation (the light plants need for photosynthesis) to pass through. To put things into perspective, Keppler explained that if you compare standing under a traditional polyethylene roof with standing under a roof with additives, you will see a significant temperature difference due to the heat-blocking properties of the additives.
This means farmers can manage agricultural growing conditions on their farms by reducing cooling costs, water usage and power consumption. This allows these farmers to plant earlier and extend the growing season, resulting in higher yields and healthier plants (which use energy to grow and fruit rather than producing more leaves for transpiration). Technology, including resilient plant genetics, reduces energy and water consumption by up to 90%.
“We saw a very dramatic increase in returns through side-by-side testing,” said Keppler, an investor turned CEO. “In fact, these are some of the only innovations that have occurred in this field in 30 or 40 years, according to some of our customers who are some of the largest growers in the world. So what this does is make it easier and more profitable to grow crops even in difficult conditions.”
Starting near KAUST, Iyris has grown rapidly in the UAE, Egypt, and Morocco. The region, where desert agriculture is common, faces harsh crop-growing environments, making it ideal for testing and demonstrating the effectiveness of the technology. But as climate change intensifies, similar challenges are emerging around the world, leading to the adoption of Iyris' technology in places like the United States, Portugal, Spain and Mexico. Keppler said the region's leading fresh produce growers are working to mitigate new climate challenges and adopt proven solutions in harsher climates.
Ensuring food security in the GCC and other dry climates
He added that SecondSky's ability to reduce input costs and, most importantly, extend the growing season is attracting growers from some arid regions. Farmers and growers who use SecondSky can continue producing even when their competitors cannot, allowing them to demand higher prices and make more money. Keppler claims this allows you to recoup your investment in SecondSky products within one year.
“So the way this works is that the growers we serve have a regular replacement cycle for their products, which typically has a lifespan of three to five years, depending on the region and application. This replacement cycle creates a recurring revenue stream for these material suppliers,” he explained. “We sell our products to growers through local distributors and provide additives to manufacturers and distributors to add to their products. “Our products are more expensive, but the benefits growers realize pay for themselves within the first year of the crop cycle.”
Aramco-backed Climate Technologies works with two main customer groups: large groups of international growers who operate farms around the world, and smaller growers and farmers reached through manufacturing and distribution partners. We sell SecondSky polycarbonate, polyethylene, netting and soon-to-be-launched sunshade screens to customers in 11 countries, including Turkey and the UK. Some of our clients include Silal, Armando Alvarez Group, and Criado & Lopez.
Keppler argues that there is currently limited competition in horticulture. Companies such as US-based AppHarvest and AeroFarms have repeatedly gone bankrupt in recent years despite raising hundreds of millions of dollars in funding, showing how difficult it can be to run a vertical farming business. One of the reasons Iyris stays in business is because it uses the technology in-house, proving its effectiveness and ultimately building trust with other growers, the president said.
“There have been numerous attempts at large-scale commercialized innovative agriculture. In some cases, these solutions are valid. But our argument is that it is often more effective to use existing supply chains to provide drop-in solutions to existing agricultural infrastructure,” said Keppler, former founder and CEO of wood pellet producer Enviva until its recent bankruptcy. “This way farmers don’t have to change their behavior. They can continue to do what they do best: growing produce in their specific area. Our goal is to make it easier for them, extend their growth period and increase profitability in the process.”
Serving a global market with more than $6 billion in annual greenhouse covering sales, Iyris will attract more customers and sell more products (or generate more revenue) in the first quarter of 2024 than in all of 2023, according to Keppler. I did. . He added that the company will increase other indicators such as total hectares covered by SecondSky, service area (expanding to countries including India and China), and square meters of products installed for customers.
