Based in Murcia, a region known as “the market garden of Spain," agroSingularity is giving new life to discarded fruits and vegetables by turning them into food powder that can be used in applications across the industry. With a focus on tackling food waste, the startup has created a circular economy model that also helps SME food suppliers avoid losses incurred when fresh produce is thrown away due to their poor external appearance and sell-by dates.
“Most of the time these products cannot be sold and suppliers face many difficulties in the market,” agroSingularity’s CEO and co-founder Juanfra Abad Navarro said in an interview. “We want to pay for the discarded produce because we are getting some value out of it."
The startup dehydrates the unwanted produce in a Powder Ingredients Mobile Plant (PIMP), turning them into natural powder ingredients. As a result, the shelf life of the fruits and vegetables is typically increased from two weeks to 100 weeks. The powder products made their pre-commercial launch earlier this year, with 19 types of food powder ingredients on offer via distributors.
Founded in 2019 by Navarro, CMO Daniel Andreu Acosta and CPO Luis Rubio Gonzales, agroSingularity recently won the Best European Startup award at the Smart Agrifood Summit in Malaga, Spain. The foodtech has already saved 352 tons of food waste and reduced 1,479 tons of emissions. It clinched its first commercial sales deal in February and is now in the midst of securing funding of €1.2m, with €450,000 earmarked for the development of its in-house PIMP tech, whose patent is pending, and facilities.
With about 1.3bn tons of food, or a third of the total food produced for human consumption, lost to wastage every year, food producers need a more sustainable food production model, especially for the small businesses, which supply about 80% of food consumed annually. Converting fresh produce into powder form will enable the food industry to substantially reduce the bulk and volume of food produce for more scalable and easier transportation.
Decentralized model
agroSingularity uses a decentralized model for the manufacturing and distribution of the powder products. Manufacturing is carried out in-house, using the existing infrastructure of a partner working in paprika production. “We haven’t built the technology yet,” Navarro said. “We currently pay €0.90 per kg for the dehydration process, but we aim to reduce this cost to €0.60. We do the microbiology analysis on different aspects of the products throughout every production.”
The startup also runs R&D units in various parts of Spain to leverage collaborations with industry professionals. “In Murcia, we are working with CTC [Centro Tecnológico Nacional de la Conserva y Alimentación, the national technological center for conservation and food], in Granada with CIDAF [Center for Functional Food Research and Development] and in Navarra with CNTA, [the National Center for Technology and Food Safety]. We also have collaborations with universities all over Spain,” he said.
The goal is to develop more powder mixes designed for specific flavoring or coloring usage in its Powder4 range, and applications in flavoring, texturing and natural coloring across the food, nutraceutical and cosmetics industries. Producing sustainable powder ingredients is also a focus. "We are doing R&D to substitute actual ingredients with more circular and sustainable powder ingredients,” he said.
“We have signed contracts with 10 clients. Some are focused on coloring applications, while others require sustainability and innovations.”
As such, agroSingularity is also looking into developing co-innovation projects with food brands as the ultimate clean-label solution for eco-conscious and sustainable food production. “We are supporting food brands to go clean-label," Navarro said.
Distribution in Europe, the Emirates, US
agroSingularity is tweaking its revenue model, which currently comprises sales of the powder ingredients and mixed blends. The commercial launch is set for next year. In 2022, the company plans to earn additional income through leasing or renting out the in-house technology and machinery it would have developed. “We will focus on PIMP rentals as the most convenient way to market our technology to potential clients,” Navarro said.
So far the business has generated a total revenue of €60,000. “We initially planned to sell €320,000 this year. However, due to Covid, we’ll probably achieve one-third of our initial target,” he said.
The SME food suppliers get about €0.10 per kg for their discarded food and by-products. Using PIMP, the 80–90% humidity content of the fruits and vegetables is reduced to powder with a humidity level of below 10%. On average, 10 kg of raw materials will produce 1 kg of powder. "This conversion indicator is the key to what we’re doing, it’s the main production cost,” Navarro added.
Since 2019, the company has raised a total of €265,000 in funding, including €100,000 from Innovative Sports Investment and a grant from ENISA, the Spanish state investment agency. The co-founding team is applying for more grants in the future to expand at home and abroad.
Meanwhile, the new funding round will also help finance the recruitment of more staff and expand its international distribution network. “Our distributors are in charge of building the sales in Europe and the US,” Navarro said. “We’re also looking at the Emirates, focusing in particular on food powders.”
In May 2020, agroSingularity gave Brenntag, Germany’s largest chemical distributor, the exclusive distribution rights for its full range of powder products in Spain and Portugal, as well as for expanding its distribution across Europe. According to Navarro, the company expects to generate revenue of €4.2m in 2021, based on projected sales of powder ingredients and mixed blends.
