At TechCrunch’s latest StrictlyVC event in Los Angeles earlier this week, Shinkei Systems founder Saif Khawaja and Founders Fund partner Delian Asparouhov continued their conversation with questions that don’t typically come up at venture events. How do you know if your fish is stressed?
It is a fair question for Khawaja to address this issue. Because his company, Shinkei, has built its entire business around answers. Shinkei makes a refrigerator-sized robot called Poseidon that fishermen install on their boats. The machine uses computer vision to scan each fish, identify the species and locate the brain. They then pierce the brain and sever the gills, killing the fish before it can struggle or suffocate.
It may not sound very sympathetic, but it is much better than the alternative of dying slowly over a period of minutes to an hour. Fish is flooded with stress hormones and lactic acid, dulling its flavor and shortening its shelf life. All of this is an automated, industrial-scale version of ikejime, a centuries-old Japanese technique traditionally performed dockside by trained fishermen at the moment of catch. By immediately killing the fish and draining the blood, ike jime delays decomposition long enough for the meat to safely age for several days, sometimes longer, before being served. The aging period gives the finest sashimi a concentrated, savory flavor as enzymes slowly break down the muscles.
Khawaja’s origin story is somewhat unusual for a hardware pitch. He grew up on fishing trips with his family in the Middle East, and it wasn’t until college that the idea for Shinkei came to him, when he read the animal rights philosopher’s essay “If the Fish Screamed.” The premise is that fish have no vocal cords, so the pain most fish experience on their way to the plate is essentially invisible.
But Shinkei’s ambitions extended far beyond killing machines. Now the company describes itself as a vertically integrated fish harvester and processor, deploying robotics and AI throughout the chain from boat to plate. Shinkei provides the Poseidon Machines to fishermen for free and then pays those fishermen a premium price for the fish that come from them, much higher than the catch would fetch at a standard dock auction. In return, Shinkei would own the fish outright rather than having the fishermen sell the fish on the open market. The catch is then shipped to a 16,000-square-foot plant that Shinkei purchased in Tacoma, Washington, where it is broken down and sold as “occasion grade” fish under the company’s consumer brand, Seremoni.
The most striking evidence so far is the menu at Erewhon, a Los Angeles grocery chain beloved by influencers. Erewhon sells Shinkei’s fish as Ceremony grade miso black cod, which is hot in ready-to-eat bars, and its marketing relies heavily on the “sustainably caught and humanely harvested” frame. The arrangement is still in pilot stages and is currently running at Erewhon’s Manhattan Beach location, with a wider rollout to other stores depending on how well it sells. Khawaja claims the company already supplies fish to restaurants with 50 Michelin stars, something that has never happened before. Japan imports American fish into its seafood market, but Japan has historically treated American seafood as inferior to domestic seafood.
Whether buyers will pay a premium for “humanely slaughtered” fish, as many now pay for humanely raised beef and poultry, is still an open question, and even Khawaja says that’s a secondary issue when describing the company. He told the El Segundo crowd that the real selling point was not the animal welfare story, but the pragmatic story about quality. The catch, which typically has a shelf life of five to seven days, can stretch to 12 to 14 days, and the company has cooked the fish three weeks after being out of the water without any problems, he said. Shinkei’s latest product, an in-plant sensor system, attempts to quantify this by scanning fish and predicting each fish’s individual shelf life. This is important in an industry where, by Khawaja’s estimates, about 18% of products are lost to damage between docks and stores, even before retail losses are calculated.
The problem of corruption is intertwined with the details of the U.S. seafood supply chain that surprise most people who don’t work in the field. A significant portion of the fish caught in U.S. waters by U.S. ships is frozen and shipped overseas, often to China, for labor-intensive heading, gutting, sizing and filleting before being shipped back there and sold. Industry estimates of how much U.S. seafood is imported are as high as 90 percent, but some estimates suggest that about half of that actually originates in domestic waters before traveling abroad. Some in China’s seafood processing sector are reportedly tied to forced labor, including Uyghur workers in Shandong province and North Korean workers in Liaoning province, making the system the subject of U.S. trade and labor investigations in recent years.
There has been a push within the industry to “re-land” some of that processing, spurred in part by pandemic-era disruptions and tariffs that have made round-trip travel to China less attractive. The bet Shinkei and the Founders Fund are making is that reconnecting, capturing, killing, processing and distributing the entire chain under one roof in Tacoma can be done profitably enough to beat the competition.
For Founders Fund, the bet fits a pattern of supporting founders who often fall outside of trendy categories. Asparouhov, who speaks a mile a minute, made it clear to attendees: No one on Earth wants to spend their life working on a robot that essentially kills fish, and considering the smell of Shinkei’s offices, this isn’t surprising. (We all laughed at the observation, although we’re a little underselling the segment. In addition to Shinkei, a Japanese company called Nichimo is selling a device to stun fish to help humans perform ike jime by hand, and several startups in Norway are building robotic systems for more humane fish slaughter and processing. Shinkei’s clear advantage for now is that it’s the only company running a fully automated version of the technology at scale on American boats.)
In fact, Asparouhov said the company intentionally keeps its exposure to complex categories like general AI applications relatively low. By his calculations, AI and defense both account for around 15% to 20% of the fund’s deployed capital, which he estimates is much lower than the typical amount for other ventures. Shinkei is working with Halter, a New Zealand-founded company that makes solar-powered, GPS-equipped cattle collars that allow ranchers to remotely herd cattle, and Ohalo Genetics, a crop genetics company founded by “All-In” podcast co-host David Friedberg, as evidence that the company’s interest in food and agriculture is not a one-off.
Of course, the fund’s recent headline-grabbing win had nothing to do with fish. Elon Musk’s early aggressive bets on SpaceX, a relationship that goes back to Peter Thiel and Musk’s shared history at PayPal, have reportedly generated tens of billions of dollars for the company (making it one of the biggest venture achievements ever recorded). Asparouhov argued that a win would accelerate the venture’s broader transition into hardware and real-world businesses, noting that most of the largest companies on Nasdaq today already involve complex electromechanical systems rather than pure software. He predicted that liquidity would be plentiful and that more SpaceX graduates formed in collaboration with Musk would start ambitious real-world companies.
It will take time to see if Shinkei becomes one of the company’s next big wins. It’s been bitten a lot. The company operates simultaneously as a robot manufacturer, seafood processor, and consumer brand, each with its own unique challenges. Fishermen are used to doing things a certain way. Dealerships are built on decades of habits. Chefs and grocery buyers still need to be convinced that the story of humane fish slaughter is worth paying more for. That doesn’t mean that the hardware it sells or the products it sells, which must survive saltwater, fish guts and life on commercial boats, are perishable, leaving little room for the kinds of mistakes that simple software companies can shrug off.
Still, just chatting with the pair in El Segundo was enough for the audience to understand why the Founders Fund finds this bet compelling. The company doesn’t believe it has found a founder building something new in an incredibly dysfunctional industry. I think this is the kind of company no one in America wants to build.
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