{"id":147566,"date":"2024-04-05T07:22:00","date_gmt":"2024-04-05T05:22:00","guid":{"rendered":"https:\/\/renewable-carbon.eu\/news\/?p=147566"},"modified":"2024-07-04T13:42:01","modified_gmt":"2024-07-04T11:42:01","slug":"tervivas-strategic-pivot-the-development-cycles-of-our-tech-are-longer-than-the-economic-cycles-in-which-we-operate","status":"publish","type":"post","link":"https:\/\/renewable-carbon.eu\/news\/tervivas-strategic-pivot-the-development-cycles-of-our-tech-are-longer-than-the-economic-cycles-in-which-we-operate\/","title":{"rendered":"Terviva\u2019s strategic pivot: \u2018The development cycles of our tech are longer than the economic cycles in which we operate\u2019"},"content":{"rendered":"\n\n\n<p>The ultimate \u2018climate-smart\u2019 crop, nitrogen-fixing Pongamia trees produce significantly more biomass per acre than soybeans with a fraction of the inputs. But scaling and commercializing products from a completely new crop takes time and patient capital, says\u00a0<a href=\"https:\/\/www.terviva.com\/\">Terviva<\/a>\u00a0cofounder and CEO Naveen Sikka.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<div class=\"BorlabsCookie _brlbs-cb-youtube\"><div class=\"_brlbs-content-blocker\"> <div class=\"_brlbs-embed _brlbs-video-youtube\"> <img decoding=\"async\" class=\"_brlbs-thumbnail\" src=\"https:\/\/renewable-carbon.eu\/news\/wp-content\/plugins\/borlabs-cookie\/assets\/images\/cb-no-thumbnail.png\" alt=\"YouTube\"> <div class=\"_brlbs-caption\"> <p>By loading the video, you agree to YouTube&#8217;s privacy policy.<br><a href=\"https:\/\/policies.google.com\/privacy?hl=en&amp;gl=en\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Learn more<\/a><\/p> <p><a class=\"_brlbs-btn _brlbs-icon-play-white\" href=\"#\" data-borlabs-cookie-unblock role=\"button\">Load video<\/a><\/p> <p><label><input type=\"checkbox\" name=\"unblockAll\" value=\"1\" checked> <small>Always unblock YouTube<\/small><\/label><\/p> <\/div> <\/div> <\/div><div class=\"borlabs-hide\" data-borlabs-cookie-type=\"content-blocker\" data-borlabs-cookie-id=\"youtube\"><script type=\"text\/template\">PGlmcmFtZSB0aXRsZT0iUG9uZ2FtaWE6IE5ldyBraWQgb24gdGhlIHBsYW50LWJhc2VkIGJsb2NrPyIgd2lkdGg9IjUwMCIgaGVpZ2h0PSIyODEiIHNyYz0iaHR0cHM6Ly93d3cueW91dHViZS1ub2Nvb2tpZS5jb20vZW1iZWQvV0diNDYtaW1OSTQ\/ZmVhdHVyZT1vZW1iZWQiIGZyYW1lYm9yZGVyPSIwIiBhbGxvdz0iYWNjZWxlcm9tZXRlcjsgYXV0b3BsYXk7IGNsaXBib2FyZC13cml0ZTsgZW5jcnlwdGVkLW1lZGlhOyBneXJvc2NvcGU7IHBpY3R1cmUtaW4tcGljdHVyZTsgd2ViLXNoYXJlIiByZWZlcnJlcnBvbGljeT0ic3RyaWN0LW9yaWdpbi13aGVuLWNyb3NzLW9yaWdpbiIgYWxsb3dmdWxsc2NyZWVuPjwvaWZyYW1lPg==<\/script><\/div><\/div>\n<\/div><\/figure>\n\n\n\n<div style=\"height:9px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p>Speaking to&nbsp;<em>AgFunderNews<\/em>&nbsp;at the&nbsp;<a href=\"https:\/\/futurefoodtechsf.com\/\">Future Food-Tech summit<\/a>&nbsp;in San Francisco last week, Sikka said Terviva remained committed to its human food operation (Pongamia oil and protein) but had decided to prioritize animal feed and biofuels in the short term as it develops lower-cost approaches to scaling up the human food operation.<\/p>\n\n\n\n<p>\u201cIn the last 12 months, it\u2019s been really hard to form capital to bring new food ingredients to market,\u201d noted Sikka, who founded Terviva in 2010 with Maggie Kavalaris, Anne Slaughter, and Joe Andrew and has raised $100 million to date.<\/p>\n\n\n\n<p>\u201cSo we\u2019ve got to rethink the scalability of that whole part of our business. We\u2019ve made a few decisions. The first is that we\u2019ve walked back some of our assumptions in scaling up the oils and the proteins as food ingredients. We\u2019re still bringing it to market on the timeline we expected but at a lower scale point.\u201d<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Manufacturing partnerships<\/strong><\/h3>\n\n\n\n<p>In the short term, he said, \u201cWe\u2019re going to divert our Pongamia bean volume more towards biofuel and feed, where we can generate a positive gross margin, if not a very high gross margin compared to food ingredients.<\/p>\n\n\n\n<p>\u201cAnd then we\u2019re going to form a manufacturing partnership for these food ingredients. We have a partner in mind we\u2019ll hopefully be announcing it in the next three or four months. Somebody who can take the risk of manufacturing this off of us and give confidence to the market that they will be able to scale these ingredients at volume and adequate quality.\u201d<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Strategic pivots<\/strong><\/h3>\n\n\n\n<p>As for the funding environment, he said, \u201cI think what\u2019s interesting for agtech and foodtech is that the development cycles of our technologies are longer than the economic cycles in which we operate.<\/p>\n\n\n\n<p>\u201cFor example, things were getting nice and hot on novel food ingredients in 2019. Then COVID happened and slowed things down, but things picked back up because everybody was interested in novel food ingredients. But then boom! Two years later<a href=\"https:\/\/agfundernews.com\/agrifoodtech-startup-investment-drops-50-now-accounts-for-just-5-5-of-global-vc-dollars\">&nbsp;this market downturn hits.<\/a><\/p>\n\n\n\n<p>\u201cFortunately for Terviva we have other products that we can pivot to. We can do biofuel feedstock and we can do feed ingredients. I think the real challenge is you\u2019ve got to be able to last through cycles. You\u2019ve got to have partners who believe in you, who will pull you through those difficult cycles.<\/p>\n\n\n\n<p>\u201cAnd if you can\u2019t make it through the cycle the way that you thought, you have to bring down the investment you spend in the business. So in our case, we didn\u2019t have to fold Terviva, we just had to take our food ingredients business, look at it very carefully and say, Hmm, we might have to deprioritize investment here and move investment to other products .\u201d<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>\u2018It\u2019s a great time to partner with strategics\u2019<\/strong><\/h3>\n\n\n\n<p>That said, \u201cpivoting, even for a small company, can be painful,\u201d he acknowledged. \u201cAnd I would say&nbsp;<a href=\"https:\/\/agfundernews.com\/incremental-innovation-a-warning-on-the-push-for-profitability-and-investors-scared-shitless-about-portfolios-overheard-at-world-agri-tech\">in this market moment in agtech<\/a>&nbsp;where everybody\u2019s trying to raise capital, corporates, strategics have never been more important.<\/p>\n\n\n\n<p>\u201cAppreciably, the financial capital has paused or is taking a slower look at what\u2019s happening, whereas most strategics are operating on some kind of mandate to decarbonize, to improve their sustainability footprint, and they are taking a longer and patient view.<\/p>\n\n\n\n<p>\u201cSo I think it\u2019s a great time to partner with strategics, although there are some caveats. I think you have to be careful about not giving away too much when you do those kinds of partnerships as most strategics want a lot of upside for their capital in terms of product availability or technology licensing.\u201d<\/p>\n\n\n\n<p>But he added: \u201cIf you\u2019re careful, if you talk to multiple strategics and try to find the best one that fits your business, you can find a really great partner who will contribute capital and it will give the rest of capital markets confidence in your business.\u201d<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter\" id=\"attachment_38091\"><a href=\"https:\/\/agfundernews.com\/wp-content\/uploads\/2024\/03\/Pongamia-harvest-Image-credit-Ian-Schiller.jpg\"><img decoding=\"async\" src=\"https:\/\/agfundernews.com\/wp-content\/uploads\/2024\/03\/Pongamia-harvest-Image-credit-Ian-Schiller.jpg\" alt=\"Founded in 2010 by Naveen Sikka, Maggie Kavalaris, Anne Slaughter, and Joe Andrew, Terviva is on a mission to shift Pongamia from a niche source of ingredients used in Ayurvedic medicine to a major food crop in the food, feed, and biofuels markets.\" class=\"wp-image-38091\"\/><\/a><figcaption class=\"wp-element-caption\">Founded in 2010 by Naveen Sikka, Maggie Kavalaris, Anne Slaughter, and Joe Andrew, Terviva is on a mission to shift Pongamia from a niche source of ingredients used in Ayurvedic medicine to a major food crop in the food, feed, and biofuels markets. \u00a9 Ian Schiller<\/figcaption><\/figure><\/div>\n\n\n<h3 class=\"wp-block-heading\"><strong>\u2018Vertical soy\u2019<\/strong><\/h3>\n\n\n\n<p>Nitrogen-fixing Pongamia trees\u2014sometimes referred to as \u2018vertical soy\u2019 as they produce seeds with high levels of protein and oil\u2014have not historically been used as a food crop owing to inconsistent yields and bitter components in the beans.<\/p>\n\n\n\n<p>However, Terviva\u200b\u200b\u200b\u200b has developed proprietary techniques that remove anti-nutritional components during processing, opening up new market opportunities for the \u201cincredibly robust\u201d\u200b\u200b drought-resilient crop, which requires minimal inputs, said Sikka.<\/p>\n\n\n\n<p>While Terviva has historically sourced Pongamia beans from India as it builds up a domestic network of growers, it has built an IP platform around high-yielding Pongamia trees coupled with propagation techniques that deliver scalable, consistent crops in a variety of locations including Florida (where it partners with fruit growers devastated by citrus greening disease) and Hawaii (on land previously dedicated to sugarcane).<\/p>\n\n\n\n<p>\u201cWe have built an extensive crop breeding platform around Pongamia where we\u2019re now able to get reproducible and consistent high yields of these beans on tier two agricultural land.\u201d<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter\" id=\"attachment_38090\"><a href=\"https:\/\/agfundernews.com\/wp-content\/uploads\/2024\/03\/Ponova-oil-Image-credit-Terviva.jpg\"><img decoding=\"async\" src=\"https:\/\/agfundernews.com\/wp-content\/uploads\/2024\/03\/Ponova-oil-Image-credit-Terviva.jpg\" alt=\"Ponova oil has a slow melting curve and a high smoke point (437 degrees Fahrenheit)\" class=\"wp-image-38090\"\/><\/a><figcaption class=\"wp-element-caption\">Ponova oil has a slow melting curve and a high smoke point (437 degrees Fahrenheit). \u00a9 Terviva<\/figcaption><\/figure><\/div>\n\n\n<h3 class=\"wp-block-heading\"><strong>\u2018Highly usable feed and food ingredients\u2019<\/strong><\/h3>\n\n\n\n<p>Terviva has also developed processing techniques to remove bitter components from the beans and \u201cmake highly usable feed and food ingredients,\u201d said Sikka. \u201cSo our edible oil, which we call Ponova oil, has already entered the market. We\u2019re doing small scale sales, almost like test and learn types of sales with leading brands where we can talk about the story of Terviva and Pongamia with the oil.\u201d<\/p>\n\n\n\n<p>One such customer is plant-based brand ALOHA, which is \u201ctelling great stories about regenerative agriculture in Hawaii,\u201d said Sikka.<\/p>\n\n\n\n<p>\u201cWe\u2019ll continue to do these types of small volume applications over the next couple of years. And then in 2026, we expect to bring the first larger scale Pongamia sales into the US market. We\u2019re also going after very low carbon intensity biofuel feedstock and selling protein feed ingredients in India.\u201d<\/p>\n\n\n\n<p><a href=\"https:\/\/www.newswire.com\/news\/terviva-announces-strategic-partnership-with-mitsubishi-corporation-22192219\">New strategic partner Mitsubishi<\/a>&nbsp;is \u201ctruly helping us across every aspect of our business,\u201d he said. \u201cThey\u2019re helping us sell biofuel feedstock, feed ingredients and food ingredients. They\u2019re also helping us scale tree planting.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The ultimate \u2018climate-smart\u2019 crop, nitrogen-fixing Pongamia trees produce significantly more biomass per acre than soybeans with a fraction of the inputs. But scaling and commercializing products from a completely new crop takes time and patient capital, says\u00a0Terviva\u00a0cofounder and CEO Naveen Sikka. Speaking to&nbsp;AgFunderNews&nbsp;at the&nbsp;Future Food-Tech summit&nbsp;in San Francisco last week, Sikka said Terviva remained committed [&#8230;]<\/p>\n","protected":false},"author":59,"featured_media":147599,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none","nova_meta_subtitle":"Terviva\u200b\u200b\u200b\u200b is opening up new market opportunities for the \u201cincredibly robust\u201d\u200b\u200b drought-resilient crop as biomass or nutrition for humans","footnotes":""},"categories":[5572],"tags":[5838,5842,15965,12575,23389,12417],"supplier":[1009,12164],"class_list":["post-147566","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-bio-based","tag-bioeconomy","tag-biomass","tag-feed","tag-nutrition","tag-plantoils","tag-proteins","supplier-mitsubishi-chemical","supplier-terviva"],"_links":{"self":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts\/147566","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/comments?post=147566"}],"version-history":[{"count":0,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts\/147566\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/media\/147599"}],"wp:attachment":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/media?parent=147566"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/categories?post=147566"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/tags?post=147566"},{"taxonomy":"supplier","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/supplier?post=147566"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}