Startup Spotlight: FENIK

Startup Spotlight: FENIK

Originally known as Evaptainers, Fenik started out as a student project at MIT. The team’s goal was to develop a low-cost method for preserving fruits and vegetables in remote areas. Five years and many prototypes later, Fenik recently wrapped up a successful Kickstarter campaign and launched production of its Yuma No-Ice Cooler.

While the new product will keep your camping supplies nice and cool, Fenik’s mission is to provide an inexpensive food-preservation solution for people in developing countries who lack access to electricity and refrigeration. We caught up with co-founder Spencer Taylor to hear Fenik’s latest news.

What’s your founding date?

September 2013.

How big is your team?

Five people.

What problem are you solving?

Last-mile food insecurity in arid developing nations.

What’s been the biggest surprise about running your business?

How few true-impact investors actually exist. They are often talked about, but you rarely meet one.

What was the big idea that got you started?

In an MIT class called Development Ventures, on the first day the professor said, “I want you to come up with a good or service that will change the lives of one billion people.”

Whom are you competing with?

Primitive evaporative coolers, such as the Zeer Pot, or draping wet cloth over food to help to preserve it.

The coolest food system innovation I’ve heard of is…

the sheer amount of innovation going on in the food space these days.

The scariest thing about today’s food system is…

the amount of waste that is endemic throughout the cold chain in both developed and developing markets.

What’s your latest big news?

We’re taking delivery of our first production units of the Yuma in January 2019.

Best advice you’ve received?

Hardware is hard.

What advice do you give to potential startup founders?

Start with a problem you have experienced, or one that you deeply understand through others. Assume nothing and validate your approach compulsively as you progress with your client base. Constant course corrections are not the product of inexperience; they are critical to success.

The Yuma No-Ice Cooler assembles easily and needs only water for evaporative cooling. The water is stored in the cooler’s walls and lowers the internal temperature 10-20 degrees — or more in drier environments.

Startup Spotlight: UAV-IQ

Startup Spotlight: UAV-IQ

Using military-developed technology, UAV-IQ combines high-tech field surveillance, environmental sensors and specialized software to help farmers keep a close eye on their crops. Pinpoint imagery allows farmers to focus on problem areas — locating issues such as water puddling or the beginning of a disease outbreak — and address them before they spread. Information sensed by the drone, including images that show detail down to individual leaves, can be transmitted to tablets or other tools used by farm staff anywhere in the field. We caught up with Andreas Neuman, co-founder and CEO of the Food+City Challenge Prize 2018 winner, to get its latest news.

What’s your founding date?

April 2016.

How big is your team?

Five people.

What problem are you solving?

Precision agriculture has proven to be highly effective for growers who practice it, but many growers perceive pricing or lack of training as barriers to adoption. Starting with drone-based remote sensing (which tells growers where their crops are healthy and where they’re stressed), UAV-IQ makes precision agriculture technology accessible and implementable within existing workflows to growers of any size and sophistication.

What’s been the biggest surprise about running your business?

That there are so many people genuinely interested in helping young companies get started.

What part of the food system are you in?

We focus on helping growers.

What was the big idea that got you started?

That one of the most fundamental problems for farmers — identifying where their crops are struggling and targeting their treatments precisely where they’re needed — was a solvable problem by using properly equipped to drones to rapidly scout fields.

Who are you competing with?

Inertia — sticking with an inefficient status quo — is our largest competitor. We also compete with satellites and other imagery providers.

The coolest food system innovation I’ve heard of is…

The use of hyperspectral sensors to identify specific disease, ripeness levels and other qualities while the crops are growing.

The scariest thing about today’s food system is…

Lack of diversity.

What’s your latest big news?

We are starting to provide a new service that utilizes drones to drop biological control agents (beneficial insects) to suppress pest populations in California.

What’s the best advice you’ve received?

If it’s not a “hell yes,” it’s a “no” when contemplating early employees and partners.

What advice do you give to potential startup founders?

Focus on building the best team before focusing on building the best product or service.

Startup Spotlight: Vinder

Startup Spotlight: Vinder

Founded in Port Townsend, Washington, by Sam Lillie, Vinder connects home veggie gardeners with folks who want to buy that fresh produce. The app brings together community members who are interested in ultra-local food and reducing food waste. It also boosts the local economy by opening up a revenue stream for green thumbs who connect with their neighbors to share their garden’s bounty. We recently reached out to the 2018 Food+City Challenge Prize contestant to find out how things are going at Vinder.

What’s your founding date?

January 21, 2018.

How big is your team?

Four full time.

What problem are you solving?

Food waste, cost and food insecurity.

What’s been the biggest surprise about running your business?

As much as I heard and read about it, the investor “run-around” has been my biggest surprise. Most professional investors I’ve had the privilege to speak with don’t give a solid “no.” They give advice and information, which is great because it helps hone the pitch and business plan/strategy. But it may not be the right type of advice that works for your company or be useful when approaching other investors. It ends up being a massive time/energy zap.

What part of the food system are you in?

Vinder is situated in the distribution of hyper-local produce — neighbor to neighbor. Yet, we do not own any delivery vehicles or own any inventory.

What was the big idea that got you started?

My community, Port Townsend, Washington, had a big problem accessing local organic produce for a reasonable price. Vinder was created not to be some massive, disruptive company, but to solve a problem in my community.

Whom are you competing with?

For convenience, we compete with HEB or Whole Foods. For freshness and locality, we compete with farmers’ markets. However, we see ourselves as a tool to help those small vendors reach more customers and increase sales direct-to-consumer.

The coolest food system innovation I’ve heard of is…

a company called Vinder that allows you to buy, sell or trade homegrown produce and neighbor-made goods directly from your neighbors. It’s free to sign up and free to sell or trade.

The scariest thing about today’s food system is…

we have normalized an absence of connection to our food system. We have no idea what is actually going into the soil in which our food is being grown (or what chemicals are being sprayed on them), who is growing it or where exactly it is being grown.

What’s your latest big news?

We are now a user-owned and -operated company. After successfully closing an Equity Crowdfunding round of more than $85,000 via WeFunder and receiving matching angel investments, Vinder issued preferred shares to users who are taking a stand against our current food system and are opting to create the neighbor-made food system of the future. Vinder is also now available for iOS and Android.

Best advice you’ve received?

In the words of entrepreneur and venture capitalist Paul Graham, “Focus on getting 100 people to love you rather than 1,000 people to kind of like you.”

What advice do you give to potential startup founders?

You don’t need a lot of money to start a company. First, come up with the lowest-budget minimum viable product and validate that the market needs your solution. Then build out manually, followed by tech. Let tech be a solution to make a process more efficient rather than the primary focus.

Startup Spotlight: Grit Grocery

Startup Spotlight: Grit Grocery

Grit Grocery has put a gourmet grocery into a food truck. Working directly with farmers and other local producers, Grit Grocery launched a fleet of grocery trucks to bring fresh ingredients and meal-kit bundles into urban areas — starting in Houston — underserved by traditional grocery options. We visited with cofounders Michael Powell and Dustin Windham to find out how they’re doing after competing in the Food+City Challenge Prize in 2018.

What’s your founding date?

Founded in 2015, pilot in 2016-2017, full-scale launch in April 2018.

How big is your team?

Five co-founders, plus a team of seven who drive trucks, sell food, work in the kitchen and organize the warehouse.

What problem are you solving?

Grit Grocery trucks bring fresh local food products to urban locations that don’t have food retailers or that have stores that carry mainly processed nonperishable food. We’ve designed a shopping experience that provides ideas and inspirations for healthy, easy, fresh, local-food meal solutions, tonight.

What’s been the biggest surprise about running your business?

A lot of local brands are producing and growing great food, but they don’t have access to customers through a retail outlet. We get a lot of these groups asking to get their products on the truck. We also hear from apartment complexes and developers requesting that Grit be at their residences. We already have a long waiting list of sites.

What part of the food system are you in?

Grit Grocery is a retail destination. We source directly from local farmers and ranchers as much as possible. As a retailer, we are at the front line of customer interaction.

What was the big idea that got you started?

Why is it so difficult to put together all of our meals over the course of the week with fresh, local, healthy food? There’s something wrong with food retail — and with the traditional grocery store model, in particular — that makes it hard for so many people to eat healthy, find local foods and put together meals. While we’ve seen a lot of innovation in how food is grown and produced, retail innovation has been lacking. New online options are promising but lack the flexibility to be a good fit for today’s urban life. This is where Grit Grocery started.

Whom are you competing with?

Traditional grocery stores and other big-box stores are obviously the main source of food retail. Organic and specialty grocers offer food more in line with what Grit offers, but they mainly carry nonlocal food and a lot of processed food. Farmer’s markets are not competitors, but they do overlap with Grit’s offerings — though their shopping experiences are not strategically designed for customers. Online grocers and meal-kit providers are similarly flexible when it comes to delivering food retail access, but they also come up short in responding to a customer’s daily food issues and needs.

The coolest food system innovation I’ve heard of is…

Coolbot. Build a poor man’s walk-in cooler.

The scariest thing about today’s food system is…

Nowadays, food is everywhere you look, from the airport to the hardware store, schools to the office. But most of it seems to be processed junk. Society is busier than ever and we have created more on-the-go occasions to eat food than can possibly be healthy, or that can accommodate real food solutions. The processed food industry likes that and profits enormously.

What’s your latest big news?

We released a Chatbot in October 2018 that allows people to use their smartphone to order a meal for pickup at the truck. They can also use the Chatbot to find the Grit Grocery truck and order a Grit-Together, a unique dinner party event for small groups.

Best advice you’ve received?

Be resilient. That’s what grit is all about. Keep trying new things, putting ideas into action and watching to see what works and what needs further improvement.

What advice do you give to potential startup founders?

Good strategy and technology are not enough. People and their food habits are kind of weird and hard to predict. You need to test and get in front of people, see how they really engage with your food or product in their daily lives.

Startup Spotlight: Ten Acre Organics

Startup Spotlight: Ten Acre Organics

Urban farming is a hot topic in food production right now, but creating a profitable farm in the middle of a city is a hard field to plow. We caught up with 2015 Food+City Prize winner Ten Acre Organics to find out how they did it.

Ten Acre Organics (TAO) co-founders Michael Hanan and Lloyd Minick have been working on their urban aquaponic farm since 2013. Since then they have been through several iterations of products, processes and procedures. Thanks to determination and their perfect-looking, colorful variety of Bibb, Romaine, Oak Leaf and Red and Green Leaf lettuces that have attracted Austin’s top chefs, TAO became profitable in early 2018. Their five-year journey has required patience and persistence — qualities that are emblematic of every entrepreneur.

Bootstrapping the capital to get started via a Kickstarter campaign, they stayed afloat in the early years with grant money and the support of friends and family. Ten acres of land, Hanan and Minick thought, “was the ‘just-right’ size for a diversified farm to achieve economies of scale and profitability while still being able to distribute 100 percent of its produce locally,” Minick says.

Working on the farm as a “garage project” for the first year, they painstakingly developed about one-tenth of an acre from scratch in their backyard in north Austin, consuming most of what they produced. At that point the co-founders faced a question all entrepreneurs must address: How do I quit my job and work on this full time?

Raising a seed investment round is a good way for startup founders to earn the ability to work on their company full time. It’s also validation that other people see value and promise in your idea. TAO was looking for both. Then, in 2015, a panel of industry expert judges named Ten Acre Organics the Grand Prize winner of the inaugural Food+City Challenge Prize, which came with $10,000 in prize money. While the money helped them float the operation for a few months while they continued to raise money, the more important thing, according to Lloyd, was the validation.

“Winning the Food+City Challenge Prize proved to us that we had a good idea, and that investors recognized the opportunity. It really helped in terms of our reputation,” he says. Later that year, TAO closed their seed investment round with $500,000.

Receiving validation and investment are big milestones for startups. But the work doesn’t end there. With big milestones come big expectations. Scaling a business from working prototype to profitable company is often more difficult than drumming up initial success. And in the farming business, where margins are notoriously thin, economies of scale are the only way to have financial success.

But expanding an urban farm can be challenging because city land is expensive. Hanan and Minick could have moved a few miles outside of town to save on land and utilities, but their dream was to grow a community, not just food. Creating a place for community workshops, think-tank style dinners and private events is their way to help people understand and appreciate where our food comes from, how it’s grown and by whom.

“We want to make an a place that is not just a farm but a community center as a change agent, where people who feel disconnected and alienated by the modern industrial food system can experience social cohesion,” Micinic says.

With the community in mind, they stayed true to their dream and in 2016 purchased an existing urban farm just a few miles from downtown Austin. Hanan and Minick saw potential in an urban farm that was struggling operationally and financially. They decided that they could improve upon the business with things like better system design and engineering, better staffing and personnel management, improved horticultural practices to maintain product quality and consistency, and an increased focus on sales and customer development.  With these improvements, they thought, Agua Dulce farm could be the model profitable urban community farm. In early 2018, they celebrated their first profitable month. Their certified organic, aquaponically grown leafy greens are the opposite of ugly produce, and the quality of the product is one of their most significant accomplishments. It’s also a differentiator that helped them catch the attention of some of the most high-profile restaurants in Austin.

All it took was four years of back-breaking labor, day in and day out. And that’s just on the farming side. There are also business duties and decisions to be made regarding human resource management, accounting, sales and marketing, and disaster control. While he stops short of telling people not to build more urban farms, Minick has a strong warning for the folks who think urban farming is more romantic than rigor.

“Farming is hard. Starting a business is hard. And starting a farming business is just insane,” Minick says. But if you’re insane enough to work long hours in the Texas heat for several years, you just might end up with a successful business.

A variety of lettuces growing at Agua Dulce farm in Austin.
Ten Acre Organic co-founder Lloyd Minick in front of their aquaponic system at Agua Dulce farm in Austin.
 Watch the recap video of the 2015 Food+City Challenge Prize featuring Ten Acre Organics as the Grand Prize winner.
Agua Dulce farm in Austin

Startup Spotlight: Bento Picnic

Startup Spotlight: Bento Picnic

It’s not easy or cheap to open a restaurant in a growing city, and entrepreneurs are coming up with creative ways to realize their dreams of a traditional storefront restaurant. We caught up with Leanne Valenti, founder of 2016 Food+City Challenge Prize participant Bento Picnic to find out how she did it.

Leanne Valenti, founder of Bento Picnic, learned her craft from a master. Just after graduating from the Natural Epicurean culinary school in 2011, a close friend offered Valenti an opportunity she couldn’t pass up to move to Tokyo, live with her family and learn traditional Japanese cooking from everyone’s favorite chef: Mom.

During her time in Japan, Valenti became enthralled by the beautiful and healthy style of Japanese cuisine. She was particularly inspired by the bento box lunches that, according to a recent study, nearly half of the population of Japan eats each day. Seeing potential to serve delicious and healthy food to an increasingly on-the-go American market, she set a goal to provide healthy food at affordable prices.

“When I founded Bento Picnic in 2015, I did not have a storefront or a distribution plan,” she says. Undaunted, she dove right in, seeking opportunities to sell her products whenever possible. In addition to catering, she sold bentos at farmers markets and had pop-up shops, including one in a kids activity center and one in a rock-climbing gym that remains operational today. But she gained the most momentum from businesses who brought in lunches for their employees. With their compartmental style, Bento Boxes can be easily customized to fit many dietary preferences — which makes it easy for customer to order from one restaurant and please omnivores, vegans, vegetarians and gluten-free folks.

After a year of doing business in a variety of settings, she knew she had a product that people loved. Her challenge was finding “the best way to expand my footprint beyond farmers markets, pop-up pushcarts and catering.”

Prompted by a mentor, Valenti entered Bento Picnic into the Food+City Challenge Prize in 2016. She points to the competition as a time when she really started thinking more critically about how to grow and scale her business.

One piece of advice I received from a Food + City judge stuck with me, and it proved to be true,” she recalls. “He said that it is very difficult to bring a new product to market AND develop a new method of coming to market concurrently. Since I am first to market with homestyle (as opposed to sushi-restaurant-style) bento boxes in Austin, he suggested that I would have more luck if I could come to market in a more traditional way, like a storefront.” Good advice, but easier said than done.

Opening a restaurant in Austin is tricky business. Despite the city’s reputation as a destination for foodies, more than 70 restaurants and food trucks closed in 2017 alone. Meanwhile Austin’s growing population continues to drive up real estate prices for retail and residential properties. The competition from large restaurant groups and corporate chains is also increasing, and the actual number of viable restaurant properties is limited.

Because of this, many entrepreneurs start small, channeling their dreams of would-be restaurants into food trucks, food carts, pop-up stores, catering operations run from commercial kitchens and farmer’s market businesses. Their goal is to build momentum and secure enough capital and customers to scale up and enter the brick-and-mortar scene. It’s a model that has proved successful for some Austin’s restaurants, including places like Franklin Barbecue and Veracruz All Natural, which started as food trucks.

The two main things that kept me from launching a storefront from day one were the upfront capital investment required and the difficulty of acquiring a second-generation restaurant space in Austin,” Valenti says.

Focusing instead on catering and a pop-up kiosk model, Bento Picnic achieved slow but steady growth in 2016 and 2017. Renting a kitchen space in the back of a marketing firm’s office was a good way to keep overhead down and establish a customer base for its catering, pick-up and delivery business.

Leanne Valenti, founder of Bento Picnic, talks with a customer in their restaurant in East Austin.

Vegetarian Bento from Bento Picnic

 Watch the recap video of the 2016 Food+City Challenge Prize featuring Bento Picnic as a finalist.

Grab-and-go kiosk with a variety of Bento Boxes at Bento Picnic.

By the end of 2017, growing demand offered an opportunity to expand. That’s when a bit of serendipity occurred. When the marketing business decided it was time to move on, Valenti says she jumped at the opportunity to buy the place and open a bento shop storefront.

“We felt really lucky that the space became available, and it was too perfect to pass up,” she says.

The move is paying off. “So far, it has been a good move, with Bento Picnic seeing a noticeable increase in brand awareness, catering sales up 60 percent and the daily lunch business exceeding the sales that used to occur in a full week,” Valenti says.

While the jump to a brick-and-mortar establishment is never easy, most entrepreneurs know there’s a leap of faith that goes along with getting bigger. And for some, unlimited faith in their growing business comes naturally.

Valenti says she’s considered taking one of her original creations, “guacamame” (edamame guacamole), to market as a consumer-packaged-good (CPG) product. And having opened a storefront in the ultra-competitive Austin market, opening in other cities now seems achievable.

“Now that I’ve honed my business model and launched my brick-and-mortar space, I’m looking to expand Bento Picnic’s presence statewide,” Valenti says. It seems the scaling never ends for food startups.

Former accountant’s office turned into Bento Picnic restaurant.

“Guacamame” (edamame guacamole) with crudités from Bento Picnic