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In The Climate Tiger, I share my thoughts and analysis on business strategies, tech news, trends, and secrets to supercharge the climate transition. And I would love to get your perspective on those.
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Nowadays, it's common to oppose Earth from Space. Many people think we should focus on Earth and not waste our resources to explore the universe, send rockets or colonise other planets. But what if space exploration could serve our interests, on earth?
Actually, that’s the main argument scientists use today to advance their research in space. We should look as far as possible in the universe to better understand our planet. Paradoxically, I feel space exploration became an highly ecological field. So why not a private company could serve both objectives?
Interstellar Labs is certainly the best example. They build biofarms (called BioPod) to cultivate plants on the moon and on Mars.
At first, it look like an impossible go-to-market challenge. Because colonization of planets should not be needed before 2035 (at least), Interstellar could have stayed in the lab for the next 10 years. But that’s not how we build deep tech.
Today, I want to deep dive into Interstellar Labs go to market strategy, I’ll call “Lego to market”.
Let’s dive in.
Interstellar Labs : The "Lego to market" from Space to Earth
If you remember well, the movie Interstellar starts with an alarming farming apocalypse. Earth is dying and not able to produce anymore the food humans need. I don't know if Interstellar Labs chose that name for that reason but that's an interesting thing to notice.
It's true that modern agriculture is slowly killing our planet. It produces 23 % of total CO2 emission, 40% of the and high volume of water. We need to find smarter ways to grow things and indoor farming is an alternative.
But there is a problem.
In the recent past, indoor farming companies failed to demonstrate a viable model for and the technology seems far from being developed.
The story of Agricool.
Back in 2017, one of the most ambitious company in the french tech ecosystem was Agricool. I remember I was thrilled by it missions when I discovered it : changing the way we approach agriculture, the root of our civilisation, by growing food in shipping container. Agricool decided to focus on fresh vegetables for urban citizens and started with strawberries.
But in 2022, Agricool went bankrupt. After raising €35M , the company was bought for 50,000 €.
There are many reasons why Agricool failed. Some include the technology, that was not ready. But I think the main mistake was the go-to-market. Agricool wanted to focus on a too big objective, too fast. They wanted to replace 10,000 years of Agriculture with a few million dollars. But over the years, production costs remains too high. Agricool was obsessed to show profitability of a unique farm and putted all the (strawberries) in one basket. In short, Agricool focused too much on a unique, risky B2C strategy.
You may ask, if Agricool failed, why Interstellar Labs should succeed?
You are right At first, Interstellar Labs mission is more difficult. It’s not even about growing things near the cities, but…in space, where :
There is no electricity so BioPod needs to rely on solar panels.
There is no water which is the vital ingredient for
Plants are exposed to radiations which is an unsolved problem for now.
But I think Interstellar Labs approached the challenge with a different go-to-market strategy : "The Lego strategy".
The Lego strategy.
For every ambitious projects, there is a moonshot. For Interstellar Lab, it's funny, because it’s litterally growing things on the Moon. But instead of reaching the moon directly, we need to sequence a series of steps. Each step is a validation is de-risking the following one. In other words, you should target what is possible first, not the big vision.
We can sequence Interstellar Labs in 3 phases
Phase I : prototype : demonstrate the technology.
Phase II : Selling to the underserved niche customers on Earth.
Phase III : Expanding to space.
Interstellar Labs is in phase II and it chosed a "niche strategy." Instead of targeting crowded markets, it chose to serve more niche customers where competion doesn't exist. A few uses cases includes :
Cosmetics & pharmaceutics : grow ingredients and plants without exporting it.
ONG : fight hunger in arid areas.
Science & research : test new molecules.
You'll notice that all those use cases are mostly B2B. It doesn't rely on consumers like Agricool did. It doesn't have an insane CAPEX because BioPods are produced on a contract basis.
A BioPods costs $249,000 and Interstellar Labs received 70 orders but can only produce 5 by years. Now, there is an issue of scalability. But it’s easier to demonstrate to investors why a new fundraising round is needed once a viable business model has been founded.
Perhaps, indoor farming has still a long way to go before it can replace traditional agriculture. Perhaps, I won’t see a human colony on Mars while I’m still alive. But for companies with those goals, it maybe worth building gradually, securing partnerships to improve the technology before the time comes.
That’s it for today. Thanks for reading! If you liked it, share with a friend or two concerned by climate change.