Ocean 14 Capital Fund has bought "a sginificant minority stake" in company © aquaManager
Over the course of two decades, aquaManager – which is still run by its founder, Kostas Seferis, has developed farm management software tailored largely to the seabass/sea bream and tilapia sectors, gaining significant traction.
“If we talk about bass and bream, they're over 70 percent and you're probably talking over 50 percent of the major tilapia players,” notes Piers Lakin, principal at Ocean 14 Capital, who led the deal.
“I think Kostas is a great entrepreneur with a great vision but has been self-guided his whole life and is looking for people to professionalise the growth, provide the capital to really start being more aggressive about investment in technology and also supporting how to deploy the technology and sell to the farmers,” he adds.
Tailor made farm management
aquaManager uses software, IoT and AI to provide tailored solutions for diverse aquaculture operations, encompassing hatcheries, cages, ponds and recirculating aquaculture systems (RAS), with customers in the Mediterranean, sub-Saharan Africa, the Middle East and Latin America. Over the past few years, it has expanded its portfolio to include IoT and low cost hardware to complement its software.
“For lower margin species like bass, bream or tilapia, you need purpose-built solutions that address that cost to the farmer in order to really get deployment, so aquaManager really focuses on very efficient low cost solutions. What aquaManager is doing is trying to utilise the equipment that farmers already have and only developing hardware where it's strictly necessary or where they can't see it being developed in the short term by other people at a reasonable price,” Lakin explains.
According to Lakin, the new product in the pipeline will improve data collection and analytics for the farmers, while they are also looking to develop small hardware components that aren’t currently available at the right price.
“The real focus is on data collection, automation of data collection, development of advanced analytics and automation of hardware. We see three core streams of data. The first is direct input from the farm, which can either be got from sensors or manual input, covering anything from stocking to feeding quantities to water temperature in in the cages. The second set of data are from public data sources, which you can then overlay on your system, a number of the salmon software companies have done a lot of work there, which is taking publicly available satellite data, weather data and laying that over your production models to develop insights and predictions. And then the third is secondary data from existing hardware systems, which is something that the company's working on at the moment,” he explains.
“It’s like the concept of using a Wi-Fi router to understand people's positioning within their house, using it as a radar because that router has the functionality to do that. It wasn't designed to do that, but you can take that data off and use it for something else,” he continues.
“Then it's about how we process that data and what the outputs we deliver to the farmers are. And I think that different layers need to be provided to different sophistications of farmers, but we want to start at the top and then have dialled down versions for different customer profiles,” he adds.
Preparing for launch
Ocean 14 would like to see a beta version of the new platform launched with aquaManager’s existing customers early in 2025, followed by a wider launch by the middle of the year.
As well as the financial returns offered by such a system, Lakin sees it driving impact too – something that’s central to the fund’s mission to support SDG 14, life below water.
“Providing more accuracy and more visibility to a farmer, plus high quantum data-fed analytics, can lead to better decision making at the farm, which can improve resource efficiency, namely FCRs, mortalities and metrics that have negative impacts of farming overall. We're also working with the company on developing an impact tool within their software so that farmers can start measuring their impact, benchmarking it against global metrics or at least customer regional metrics, based on the datasets that aquaManager will hopefully build with its customers over time. Enabling people to understand where they're falling behind, where they're pushing ahead and hopefully lift the whole industry up as one,” he reflects.
A bid to diversify
aquaManager is also looking to increase its presence in the shrimp sector.
“The big challenge is how can you demonstrate the value that it can bring to a farmer, particularly in these lower margin species. They've done a very good job at deploying it in tilapia, which is one of the lowest margin species. And they have a significant share of that market and have managed to take people from Excel, across to their programmes by demonstrating the value that it can have for them,” Lakin notes.
“Now with shrimp farming, they've got their first cohort of customers, that they've been working with for the last few years and they've already demonstrated great results there. So we see this as both about developing sales channels and understanding how can we deploy this within the different regions of shrimp production. They all have very different dynamics. The company has got traction in Ecuador in India. Replicating that should be fairly easy if we can have the right people on the ground doing that work. Obviously as an investor with investments in the shrimp industry, we'll be looking at trying to develop synergies between our portfolio companies where it makes sense for both companies,” he adds.
Looking ahead the fund has ambitions to take this further.
“We want to be the data solution for driving efficiencies in across aquaculture, across all species. We’ve got big ambitions for aquaManager. I think it's fair to say, and I think a combination of the passion of the founder, the great foundations that he's built, our connectivity into and deep operational understanding of the industry and the shared vision of wanting to drive the convergence of sustainability and economic gains. I think it's a really strong partnership with big potential,” concludes Chris Gorell Barnes, co-founder of the fund.
