Back to agriculture?

Israel is known as the Silicon Valley of the Middle East. Where it has led in telecomm technologies (internet, mobile, apps) etc, the successes have been followed in biotech, nanotech and cleantech.

Thus it may come as a bit of a surprise that one of the most important pieces of equity finance this month centres on a small moshav (farm) called Sharona. Host to genetic engineering seed company Kaiima Ltd. the final stages of a financing round is in completion stage. The talks involve “Asian investors, including Horizon Ventures of Hong Kong billionaire Li Ka-Shing and the chairman of Hutchison Whampoa Ltd. The World Bank has pledged up to $20 million out of the $50 million that Kaiima plans to raise.”

Let me explain what is so special about these farmers. Since 2006, they have been developing seeds, which have a capability to produce high quality crops and in quantity, but without any of the drawbacks of GMO. Just recently, the company was named as one of the world’s top 100 achievers in the field of cleantech.

Israel has always had a strong reputation in the field of agriculture. It was a pioneer in drip irrigation. The Negev desert produces vast quantities of crops throughout the year. Its expertise in diary farming is sought after in countries like Vietnam and elsewhere.

To understand fully the results of Kaiima’s work, the pictures on this link (Hebrew text) explain the differences achieved. That is how a small start up in the middle of nowhere can attract the attention of some of the world’s leading investors and thus record a book value of US$300 million.