“A powerful change-maker,” reads her LinkedIn bio, written in the third person. “Amy is driven by positive global change,” it continues. And the truth is that Amy Novogratz, co-founder of Aqua-Spark, the first fund in the world dedicated exclusively to sustainable aquaculture is both. However, if after our talk someone were to ask us how we would define her, we would use one word: enthusiastic. Or maybe two: enthusiastic and committed.
It’s been more than 10 years since that “Let’s build something together” she and her partner, Mike Velings, decided on when they first met. “To make something new happen, you have to think differently,” Amy says at one point in the interview. They did. Their common space was the ocean, they wanted to build a business that would increase the health of the ocean, and they realized that aquaculture was the best tool to get there. They are still at it, with enthusiasm, with commitment, with a mission: to demonstrate that sustainable aquaculture at a commercial scale is possible, that it is not “just a small idea” but “really a new system.”
A business to increase ocean health
Prior to founding Aqua-Spark Amy Novogratz was the Director of the TED Prize and, through it, she was working with Dr. Sylvia Earle – US marine biologist and explorer and the first ‘Hero for the Planet’ named by Time Magazine in 1998, among many other things – to raise awareness about the health of the oceans and the need to protect them as well as the land. “I was shocked that we knew so little about the ocean and it was confusing to me why it was so hard to get the ocean to catch on and get the energy and attention it needed for protection,” Amy recalls now.
After that, a chance (or not so chance) encounter on an expedition that was a part of the project with Dr. Earle ignited the spark of Amy’s story with aquaculture. “I met my now partner and we started thinking, ‘Let’s build something together’,” Amy tells WeAreAquaculture. “Our space, that we have in common, is the ocean and ocean impact, and our whole network is people connected to a healthier ocean, so the ocean needed to be a part of it. We wanted it to be a business, and we wanted it to be a business that increased ocean health.”
She and her now-husband, Mike Velings, began researching and realized how much we take from the ocean and how, in many cases, this is done with destructive practices. That led them to dig deeper into food systems and how much we globally depend on the ocean for protein, and they came across aquaculture. “We were shocked that it was as big as it was back then. It hadn’t yet passed wild catch for human consumption, but it was almost there,” she remembers. “And it was like, ‘Wait, almost half of the seafood we eat is farmed and nobody talks about it and nobody knows anything about how we farm fish’. And yes, it has a bad reputation, but where does that even come from? And, instead of looking at aquaculture as something negative, why aren’t we looking at its potential to feed the world a truly healthy diet within our planetary boundaries? Why aren’t we collectively working to improve aquaculture? This was 2011, when NGOs and aquaculture institutions were starting to work on this but it had not caught on, and definitely not yet through the lens of using private capital to support the development and growth of solutions to the industry’s challenges.”
They continued digging in and saw that there were what she defines as “some really impeccable farming operations that should be the example of what aquaculture is.” However, they all had one thing in common: they had to build every aspect of what they needed. They even produced their own feed ingredients, and the end result was high-quality fish but sold at a very high price, which wasn’t going to change an industry. However, far from seeing the problems, this couple committed to the ocean came up with a solution: “Well if that’s possible, can’t we just scale those elements that are needed and feed them into existing farms to improve how they do things and remodel the whole aquaculture value chain to make it more coordinated, transparent, healthier and more sustainable?”
Building the model aquaculture industry needed
Looking back, Amy Novogratz recalls that all this happened “at a moment when nobody from the outside was really investing in aquaculture.” There were some of the big salmon farm conglomerates listed, of course, but except for families investing in their own companies, there was no private investment in the industry. The sector was talking about certain investment vehicles that haven’t worked, so there seemed to be distrust in traditional investment that didn’t understand the industry, but also saying that there was a real openness for different perspectives and models to come in.
There was also, she says, a growing group of people who were really working to make it a more sustainable and healthy industry, and “all these pieces came together.” It had the potential to be the best, healthiest, smallest footprint way to feed the world, and it didn’t seem that far off from getting there, it was already huge. “Are we missing something or does this feel like a massive opportunity?” they thought. Were they?
“I think we were missing how complex and hard it was going to be to move and get people to engage with us,” Amy Novogratz tells us with a smile. “But people were also curious and intrigued by the potential and so little by little we closed.” They developed their fund based on what they saw and heard from the sector, focusing on those people who could best move the industry toward one that was truly healthier and more sustainable, more accessible.
“The model and everything was built within what the industry told us it needed.” They launched Aqua-Spark in 2013 and made their first investments in 2015. “Our model enabled us to start small and grow to have a track record to show people what investment in aquaculture looked like and help them understand the opportunity,” Amy explains to WeAreAquaculture. “It’s a model that can grow with the industry.”
Trying to make something new happen
Grow, scale, go step by step, try, start small to set a solid foundation. These are concepts Amy Novogratz mentions or hints at throughout the talk. As previously said, she used to be the Director of the TED Conference awards. TED’s motto is “Ideas worth spreading,” and the idea of the TED Prize about how change can happen is “one idea at a time.” Is there any of that philosophy at Aqua-Spark? we ask. “Completely! Learnings from the TED Prize have much to do with the philosophy of how the fund was developed.” she quickly replies.
“The Ted Prize in a lot of ways was this grand experiment. A committed individual had the opportunity to inspire a room of people that were engaged in the world – they were thinkers, they were doers, they wanted to build-, inspire them to get behind a big, ambitious idea, to bring in different ways of thinking to foster a large-scale global collaboration to solve challenges our world was facing. Sometimes it worked as planned, sometimes it didn’t, but something always came out of it, and contributors also always got a lot from being a part of it.”
Amy’s background, the very context of the expedition where she met her partner, and which gave rise to the project, all seem to be behind the company’s philosophy and model. “We have a synergistic portfolio where you bring in companies that add to the ecosystem of what aquaculture needs to get to the point of being this best-in-class, healthy, sustainable protein production system – a portfolio where companies with a shared vision of where the aquaculture industry can get to, can support each other, benefit each other, and ultimately create the blueprint from which aquaculture scales to meet the production increase needed to feed the growing population within planetary boundaries.” she explains.
“And then, there are concentric circles of stakeholder or supply chain players, co-investors, everyone with a shared vision of where we want to move this industry to. So, that really collaborative, radically open, knowing that in order to make something new happen, you have to do things differently philosophy,” she continues.
Ecosystem of aquaculture companies
So, Aqua-Spark invests in the entire value chain with the aim of, as the company defines it in its last impact report, “nurturing an ecosystem.” But, why such a global view of the industry? As the company’s co-founder explains to WeAreAquaculture, this is due to two reasons. “We want to create a demonstration portfolio to show how well aquaculture can be done. And you can’t have these showcase farming operations in your portfolio if you don’t also have the feed ingredients, and also have the technology, you also have the early disease detection, and the different ways to battle disease.”
“You need all the aspects to get to the point where you’re really showcasing sustainable production from investing in a showcase aquaculture operation, but sustainability has to be all the way from inputs to the market,” she continues. “You need to figure out what the big picture is that we are trying to achieve and invest in the myriad solutions that will create it.” In addition, Amy Novogratz points out, to achieve this it is necessary to reach a certain scale, to be of sufficient size for the demand to really put pressure on the whole.
“Now we’re finally at a point where you’re seeing some of those demonstrations because there is enough product in the market, there’s enough tech adoption and digitalized aquaculture to pilot what it means to connect them to get to the bigger picture of where this industry is going and what transformation can look like in aquaculture.”
A great example demonstrating their system works is the case of eFishery. Included in Aqua-Spark’s portfolio, it is the first aquaculture startup to reach ‘unicorn status’ (this is a valuation of over $1 billion). Its example, says Amy, “will help all of us working on new solutions and it’ll finally get investors to act inside this industry.” Because, as she acknowledges, the interest in the industry is real, but sometimes investors need a little nudge. “There’s a ton of investor interest, and you’re seeing more and more investors enter the industry, but there are a lot that are waiting at the gates to see what happens to a startup in this space,” Now that this example already exists, “it’ll help a lot of people looking at this industry to understand what’s possible.”
A unicorn that brings projects to life
This historical valuation of eFishery, “it’s a really incredible story.” However, as Amy points out, it is not only important for its performance and profitability for the company. Not even for what it has demonstrated as a proof of concept for the future of aquaculture, but mostly for its real impact. “How many lives it changes and how it starts to even the playing field in a way that empowers farmers. They’re now doing the right thing, not just because buyersare asking them to but because they’re also seeing better results from these practices.”
Being the first and the largest fund in the world dedicated exclusively to sustainable aquaculture puts Aqua-Spark in a privileged place, that of influence to improve the life of the oceans that Amy Novogratz and Mike Velings wanted to get to when they started their journey. We asked her, how does it feel to occupy that position, with all eyes in the industry looking at them. Satisfaction, responsibility, both?
“What’s exciting about aquaculture right now is this growing global community that brings different values and experiences to the table, with a shared vision of creating a healthier and more sustainable future food system,” Amy answers. “Our stable of co-investors is growing and we bring opportunities to each other. Industry is involved, supply chain players, innovators, media, events. This industry that seriously lacked coordination a decade ago, now feels like a collective movement. There’s so much momentum you start to feel that change is starting, and the possibilities expand.”
“The fact that Aqua-Spark has gone to create a brand being out there shining a light on the industry is helpful, especially in attracting new investments,” she continues. “We meet a lot of entrepreneurs because of that, andwe also want more investors in the space. The space needs a lot more capital than Aqua-Spark is going to be able to bring to it, so hopefully this will end up being something that promotes the idea of more funds and more investors moving into aquaculture.”
Shifting the market perception of aquaculture
What will those investors find when they get into the sustainable aquaculture space? The challenge for the industry hasn’t even changed that much, since she arrived in this industry, “it’s still the communication factor,” Amy says. “I’ve been in this little aquaculture bubble, so I hadn’t realized that all we’re learning. All of the new innovations and the increase in sustainable practices and tech adoption, for example, has notmoved to general awareness at all yet.”
She became aware of this recently while participating in a sustainability meeting. There she realized that people still think of aquaculture as having the reputation it had 20 or maybe 10 years ago. “Aquaculture is still on the defense, and it shouldn’t be,” she says. “Where are the groups saying, ‘Well, actually responsible aquaculture that’s becoming more and more the norm is already better – lower footprint – than producing any other animal protein?’,” she wonders. “And fish is really healthy, and it has all of these good factors already that most of the general public is connected to, so that needs to really be pushed forward,” she concludes.
“You need to shift the market and the market perception and acceptance of aquaculture to start to push the demand for new solutions.” The co-founder of Aqua-Spark thinks that once we get that greater connection to aquaculture as a food system, once there is an understanding of what responsible aquaculture is and what it means, we will see more and more pressure from retailers and buyers around how things are produced. If this global aquaculture challenge can be overcome, it will make it easier to address Aqua-Spark’s biggest challenge as a company too.
“Our biggest challenge and probably the challenge of our portfolio, it’s still fundraising,” she claims. “It’s exciting that more investors are entering this space, but it is not easy to raise capital to invest in an aquaculture fund. If you’re eFishery, and you’re already that far along and you have that big market acceptance, showing revenue numbers that are pretty spectacular, you’ll get investors, but few companies in aquaculture are at that level yet because they are still working on a new path forward.”
As said at the beginning, Amy is an enthusiastic and committed change-maker, so even though the company is in a “big moment of growth,” she is not complacent. At the end of 2014, they closed at €6.9 million, and are at the point of half a billion now, but they want to get to the next level of 3 to 5 billion “to really show that this isn’t just a small idea, this is really a new system.” She acknowledges that it’s hard and uphill, but they have expanded the team and it’s time to keep on going, with motivation and aiming toward the same target.
As sparkling as the company’s name, we’re sure Amy Novogratz will continue to think differently to make things happen. Like that time she gathered journalists and artists from multi-sector disciplines around the table in her New York loft to talk about seafood and aquaculture and as a main course served Artic Char raised at Iceland’s Matorka, one of their portfolio companies. Why? we ask. “It makes such a difference when you really understand how fish was produced, to meet the farmers and taste the product. Tasting a delicious fish that you know was farmed on land in Iceland with pristine water and geothermal energy, opens journalists’ minds and sparks interest in sustainable aquaculture and the potential of moving this industry to a level where Matorka’s practices are the commercial norm.”