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Meet Pure Harvest: sustainable food and smart farm startup

28 September 2020, by ADGM's Staff Editor

Pure Harvest, spring boarded to success shortly after registering with ADGM in late-2017, where it embarked on pre-development activities for its initial pilot high-tech, climate-controlled food production facility in Nahel, Abu Dhabi.

Sustainable food and smart farm startup, Pure Harvest, spring boarded to success shortly after registering with ADGM in late-2017, where it embarked on pre-development activities for its initial pilot high-tech, climate-controlled food production facility in Nahel, Abu Dhabi. Founded by Sky Kurtz, Mahmoud Adi and Robert Kupstas, the company scored a historic seed investment of $4.5 million following an earlier $1.1 million pre-seed round led by Abu Dhabi-based Shorooq Investments in the same year.

Kurtz, who is also CEO, explains how the company was formed as a food security solution using advanced and sustainable agriculture technologies, which were built to maintain a controlled climate even in the harsh environment of the Middle East.

“We are enabling year-round, sustainable production of premium quality fresh fruits and vegetables that we can sell into the market. This local-for-local production eliminates the waste and higher-costs associated with importing food, while offering quality, freshness and variety previously unavailable to the region’s consumers,” Kurtz says.

“We can therefore deliver food security, water conservation, economic diversification and a more sustainable food future for the country and for the region. This is the promise of the company. So, we really are farmers, but we are technology-enabled farmers.”

Pure Harvest’s decision to join ADGM was not by chance. There were numerous advantages that could be gained from basing the business in Abu Dhabi’s financial center, aside from the glistening allure of the city’s cutting-edge infrastructure.

“Firstly, we wanted to work with ADGM because Abu Dhabi has most of the land mass of any other Emirate within the UAE, and for our business that’s quite relevant,” explains Kurtz.

“Secondly, Abu Dhabi is the agricultural center of the country with longstanding institutions and infrastructure that serves food businesses, which made a lot of sense to further enable our farms. There are numerous organizations that serve agribusiness too, such as the Abu Dhabi Agricultural and Food Safety Authority (ADAFSA), which is instrumental in facilitating food production and distribution within the country.”

He goes on to explain how ADGM’s legal system being based on British common law was also a major lure as this helps businesses like Pure Harvest to access international capital markets in a rule of law and in a precedent that international institutional investors are comfortable with. “It makes us more easily accessible to global investors,” he adds.

“It’s enough that many investors are learning about opportunities in the Middle East for the first time, especially in new technology sectors like ours. It helps if they do not have to educate themselves on the legal and institutional frameworks that will support their interests in our company as well. We wish to minimize the hurdle to yes.” “Over half of our capital is from foreign investors so it has already served us well. Really, there’s just an element of tried and true corporate and common law that is easy for people to transact in, whether it be insurance products, credit market access or equity capital market access.”

This, for Pure Harvest and many companies like it, is crucial. It’s very likely foreign investors looking to put money behind a venture in the UAE are going to be less willing to part with their cash if it means hiring an attorney to help them become experts in Sharia law. The cost of which could be 10% of their total investment for an early-stage company.

“I can’t stress enough how important ADGM is to address regions with access to international capital markets and to be able to transact on a global scale,” Kurtz exclaims. “That was a critical decision factor for us, especially given our industry is capital intensive and we wanted to build a large company.” Food security has been a particular focus for the UAE and the Middle East in recent years, but nothing like current times in the global pandemic. Unlike many businesses, which have struggled to operate on similar levels during these COVID times, Pure Harvest is a shining example of a company that has used these challenging times to its advantage.

“Food security was a big focus even before COVID-19,” Kurtz explains. “But [the pandemic] has really struck the cymbal, if you will, of the narrative about food security, economic diversification and sustainability. The government has accelerated its efforts to increase local production of food and we are seeing support and investment from many ministries. It’s a great time to be an Agtech entrepreneur.”

“I can’t stress enough how important ADGM is to address regions with access to international capital markets and to be able to transact on a global scale.” Sky Kurtz, Founder & CEO, Pure Harvest

If anything, COVID-19 has intensified the need for more companies like Pure Harvest as society progresses into the future, putting a spotlight on the company, who has since received a bigger focus from UAE government and spread, generally, a better understanding of how these technologies can not only help us prepare for the worst, but also help to feed the world, which is facing fast-growing populations, despite declining freshwater resources and limited arable land.

It has not all been plain sailing for the startup. Naturally, all businesses have been negatively impacted in some way due to the pandemic and Pure Harvest was no exception. The company requires the regular importing of specific insects: bumblebees for pollinating crops and predator insects that act as a natural insecticide and attack crop-eating bugs. However, the spread of COVID-19 meant that this became increasingly difficult to action.

Luckily, ADGM were able to give their support and work with Emirates Airlines at a consumer level to import the bugs that Pure Harvest desperately needed in order to circumvent a substantial loss of crops.

Now that Pure Harvest has stamped out a footprint in the Middle East, its next steps, Kurtz claims, involve expansion around the world, starting with Southeast Asian markets.

“So far, we’ve designed, built and operated all our own facilities, but [in the future] we’ll be designing, building and operating on behalf of others,” explains Kurtz. “I call it the ‘Hilton Hotels model’; we’re a technology-enabled management company, and others are partnering and investing with us so that we can design, build and operate food production on their behalf in their given market, whether they’re the offtaker (e.g. food retailer, food distribution company, incumbent holding company), an investor or a government seeking food security.”

The CEO is positive for the future of the business, as well as the industry in general; that controlled-environment agriculture is going to be one of the pieces of the puzzle to solve the world’s food supply challenges.

“People need to eat, and they need to eat healthier. Flying food across the world is not sustainable — economically or environmentally. And now solutions exist, like ours, that make food production possible anywhere. The future is now.”

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