June 12, 2019

by Lynda Kiernan

Aquaculture tech startup Aquabyte announced it has raised $10 million through a Series A co-led by existing investors Costancoa Ventures and New Enterprise Associates (NEA). Other investors participating in the round include Alaya Capital Partners, Alliance Venture, Struck Capital, and additional angel investors.

With offices in San Francisco and Bergen, Norway, Aquabyte is the developer of a holistic software platform that brings machine learning and advanced computer vision technology to the aquaculture industry. By providing fish farms with underwater stereoscopic cameras that determine fish health, size, and optimal feed volumes, Aquabyte is working to increase efficiency, reduce operational costs, decrease fish mortality, and lessen the environmental impact of aquaculture on surrounding ecosystems.

“NEA has built a deep thesis around computer vision-based technology,” said Amit Mukherjee, partner, NEA. “We believe that Aquabyte’s computer vision solution for aquaculture is one of the best real-life applications we’ve seen. We are fortunate to have worked with Bryton since Aquabyte’s incubation stage, and are thrilled to continue partnering with the team.”

Riding the Wave

Aquaculture is the fastest growing segment in animal protein production, and was named as one of the Ag Sectors to Watch in 2019 by Philippe de Lapérouse and Mark Zavodnyik of HighQuest Consulting.

“Since 1960, global demand for seafood has increased 3.2 percent annually, outpacing the 1 percent annual growth in the world’s population over the same time period,” noted de Lapérouse.

Predictive modeling by The World Bank estimates that by 2030, 62 percent of food fish will be provided through aquaculture, and from 2030 onward, driven by pressure to fill the gap, aquaculture will dominate supply in the industry, according to the report, Fish to 2030, Prospects for Fisheries and Aquaculture.

Noting that fish farming is currently a $240 million global industry, Aquabyte said that the sector is prime for cost reduction. Earlier this year the company expanded into Norway, and has been working with the leading salmon and trout farms in the country. So far, a petabyte (1015 bytes of data, 1,000 terabytes (TB) or 1,000,000 gigabytes (GB)) of fish images have been processed, and more than 2.5 million fish have been scanned. And using its novel algorithms, Aquabyte has been able to detect the weight of a group of fish within 0.8 percent of true weight 95 percent of the time, and has detected more than 100,000 sea lice – a deadly parasite that has had a significant impact on the salmon industry in recent years.

“The success we’ve achieved in just two years has surpassed our expectations,” noted Bryton Shang, founder and CEO of Aquabyte. “We couldn’t be happier with the difference our technology is already making at the fish farms where it is in use and the enthusiastic support of the farmers and the Norwegian government.”

Aquatech Turnout

While it is true that aquaculture is a booming, high-potential industry, to realize this potential and to keep pace with global demand, new technologies and tech adoption are critical to advancing production methods. This has led to more startups emerging that are solely dedicated to developing and advancing technologies in support of aquaculture production.

In January of this year, Boston, Massachusetts-based InnovaSea Systems announced its agreement to acquire Nortek Akvakultur, a Norwegian aquatech company located in Bergen. Upon completion of the deal, Nortek Akvakultur will be integrated with InnovaSea’s Realtime Aquaculture unit – a unit that is transforming how environmental monitoring is conducted on global aquaculture operations through the development of innovative, wireless underwater technology.

“Nortek Akvakultur brings us closer to the industry in Norway and adds a team of skilled developers with unique expertise developing solutions for the industry,” said David Kelly, CEO of InnovaSea, in January. “Combining Realtime Aquaculture and Nortek Akvakultur is a logical step in growing the business and expanding opportunities both in Norway and globally.”

Two months later, Trendlines Group announced that its portfolio company BioFishency raised $2.4 million through a round in which the primary investors were a private investor from China, Dutch global investment fund Aqua-Spark, and the Trendlines Group.

The company’s initial product, the SPB Single Pass Biofilters (SPB), acts as a plug-and-play complete system, and manages turn-key projects. It has demonstrated a 95 percent reduction in water usage for intensive tanks, a two-to-five-fold increase in yields for extensive ponds, twice the ability to remove ammonia for improved water quality, and significant increase in yield per water and land use.

“The sheer size of inland aquaculture globally means that aquaculture uses a lot of scarce resources,” said Mike Velings and Amy Novogratz, co-founders of Aqua-Spark. “Biofishency’s technology enables the production of more fish per unit on land and in water while reducing the environmental impacts. This is imperative in sustaining the growth of aquaculture while reducing environmental effects.”

Given its prominence in the sector, Norway is a common geographic theme for aquatech startups. However, global expansion is in sight for Aquabyte, which plans to use the capital gained through this Series A to fund its expansion into new geographies including Scotland, Canada, and Chile.  The company will also use the funds to double the size of its team, and to grow its product line to include technologies that can estimate fish appetite and quality, predict sea lice outbreaks, and automate feeding.

“Investment in technology ventures that support the growth of aquaculture production promises to be an exciting area over the next decade for investors who are willing to take the time to educate themselves about the industry, and about what type of innovations will be the most transformative,” said Philippe de Lapérouse, director, HighQuest Consulting.

– Lynda Kiernan is Editor with GAI Media and daily contributor to GAI News. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.com.