What Happens to Farming When Water Is 10x More Expensive & Labor Is Scarce?
I haven’t written much about Homebrew’s investments in the agriculture space but there are two of note, and both are based on beliefs which might be controversial to some.
- Our global food supply chain still functions as if water is free and limitless.
- Our global food supply chain assumes that cheap labor is available wherever and whenever needed.
Climate change, consumer demands from a rising standard of living, and shifting political attitudes towards immigration, have put both water and labor very much at risk, especially when you look at the arc of the next 10+ years. But you don’t have to wait a decade to read about dramatic changes afoot. Chad faces a security and humanitarian crisis very much linked to a pivotal water resource drying up. Cape Town creeps towards its “Day Zero” drought where the city will be out of water. Our beliefs about water supply and where crops will be grown informed our investment in Bowery Farming, now one of the leading indoor vertical agriculture startups. Bowery uses no pesticides and 95% less waterto grow its leafy green crops in industrial-scale urban facilities.
Even when you can grow, can you harvest? In the UK, tonnages of food is rotting in the fields as a result of changed migrant labor patterns post-Brexit vote. But you don’t need to look thousands of miles away. There are actually crops here in the US constrained by labor supply — highly manual (and arduous) jobs which can’t attract enough labor, even paying 2–3x minimum wage. Because of this we’ve invested in a startup company here in the Bay bringing a combination of robotics and computer vision to the fields (they’re still in seed mode but will be ready for a Series A before too long).
Satya and I both believe there’s lots more innovation to come in agriculture and the global food supply chain. If you’re working in this area and think we could be good early stage funders for you, please do let us know.