Indonesian aquaculture startup eFishery pockets $200m in unicorn valuation

After reporting that it is raising new funds, Indonesian aquaculture startup eFishery announced today that it has raised $200 million in a Series D. The company, which makes a smart feeding system for the fishing, says this makes it the number one startup in the global aquaculture industry. to pass a $1 billion appraisal. Its goal is to reach one million aquaculture ponds in Indonesia by 2025 and expand overseas.

The funding was led by Abu Dhabi-based 42XFund and included participation from Kumpulan Wang Persaraan (Diperbadankan), Malaysia’s largest public sector pension fund, Swiss asset manager responsAbility and 500 Global. Existing investors Northstar, Temasek and SoftBank also returned for the round, with Goldman Sachs acting as eFishery’s exclusive financial advisor. TechCrunch last covered the startup when it announced its $90 million Series C in January 2022.

EFishery cites a study by Population Institute, University of Indonesia (LDUI) which showed that in 2022, eFishery contributed 1.55% to Indonesia’s Gross Domestic Product in the food sector. aquaculture. This is important because Indonesia has the second largest fishing and aquaculture industry in the world, ranking only behind China. According to the World Atlas, the country produces 5.8 million tons of fish every year.

Founded in Bandung, West Java in 2013 by CEO Gibran Huzaifah (pictured above), the fishery currently serves 70,000 fish and shrimp farmers in 280 towns across Indonesia. In addition to its IoT automatic feeding system, eFishery’s platform includes marketplaces for selling fish and shrimp feed to farmers, fresh fish and shrimp products to B2B consumers, and finance for fish farmers.

Huzaifah started a catfish farming business while still in college. He told TechCrunch that during this time he learned that power management was crucial, as 80% of the total cost of production was allocated to power. But many farmers still practice hand-feeding, which results in fish of unequal sizes because not all get the same amount of feed.

This is a problem because buyers have specific sizes of fish they want to buy. Underfeeding is not the only problem, however, overfeeding leads to nutrient runoff that pollutes the water.

Huzaifah has seen how technology is disrupting industries like commerce, financial services and media, but “the practice of fish farming has never changed in the past 30 years. I found it quite ironic that many innovations are being developed to solve the problems of urban citizens, such as online shopping and food delivery, but essential sectors, such as agriculture and aquaculture, see almost no digital innovation.

However, after developing eFishery’s smart feeding system, Huzaifah faced resistance from fish farmers. After months of convincing them, “they finally wanted to try, not because they believed in the technology but because they felt sorry for me.” One of the reasons was that many farmers were not regular Internet users. “I remember we had this Internet 101 with farmers,” Huzaifah said. “We showed them how to create an email, use Facebook, get information on YouTube and other things.”

Even though Indonesian aquaculture is already very large, Huzaifah said it has only reached 7-9% of its total potential. Among the challenges it faces is fragmentation. Huzaifah explains that Indonesia has 34 provinces with different business practices, so he has to locate himself for each one.

“I learned the hard way that we need to respect local actors, including using the local dialect and building relationships with middlemen,” he said. “In one case, intermediaries poisoned our ponds. After talking to them, we understood that they just want to do business, that they are also entrepreneurs. So we found a way to make them our local partners because they have the wisdom, the connections, the local assets, and so on.

On farms, feeding accounts for 70-90% of the total cost of production and much of it is still done manually, just like when Huzaifah ran her catfish farm. eFisheryFeeder automatically distributes feed to fish and shrimp and helps farmers control feeding by sensing fish’s appetite through vibration, which increases as they get hungry. The system allows farmers to manage ponds from their smartphones and collect data such as daily fish usage, type and brand of feed, number of fish produced, fish behavior and appetite. fish, stock density and mortality rate.

With aquaculture being so important to the Indonesian economy, other tech startups are tackling different aspects of the industry. Besides eFishery, startups that have recently raised funds include Aruna, Delos, and FishLog.

In order to improve Indonesia’s aquaculture industry and increase the amount of fish it exports, Hazaifah said communities, government and institutions must work together to improve the infrastructure of fishing operations so that they can handle larger volumes of fish and improve product quality.

The country should encourage sustainable aquaculture practices, such as training, promoting advanced techniques and ensuring access to quality fish seed, to increase fish production, and also engage in trade negotiations to attract more buyers. Efishery plans to expand overseas by exporting fully traceable, antibiotic-free shrimp.

In a statement on the funding, 42XFund Director Iman Adiwibowo said, “The technology and comprehensive aquaculture solutions provided by eFishery have had a significant impact on the aquatech industry and benefited Indonesian smallholder farmers. We are confident that eFishery will continue to promote a sustainable and inclusive economy, as well as contribute to environmental conservation goals, not only in Indonesia but beyond.