The Startup - Hydrazome
Overview
There is an impending food crisis in the world with 820 million people going hungry everyday. The world population is expected to become 9.7 billion by 2050 and we would need to increase our agricultural production by a staggering 70%[1]. Climate change makes the situation worse by changing rainfall patterns: increasing both drought and floods. One of the largest crises facing agriculture is waterlogging — a problem that affects nearly 12 million hectares of agricultural land in India (equivalent to the size of our neighbour Bangladesh). The resulting land degradation due to waterlogging caused an economic loss in India of over USD 670 million in 2018[2].
To tackle this challenge and to help in transforming the lives of the affected farmers, we will soon be launching a startup named Hydrazome. Hydrazome will be a transformational Agri-Biotech company which will focus on using the technology developed in our iGEM cycle to create solutions which will shield crops from the deleterious effects of waterlogging.
Mission
Our mission is to bring sustainable solutions for waterlogging to the disadvantaged farmers and to assist them in their fight against climate change.
Vision
Our vision is to lead the movement for food security and create a difference in the lives of the poor farmers using synthetic biology-powered tools.
Organizational Structure
Minimum Viable Product
Hydrazome’s product will represent a modern 21st Century solution: scalable, sustainable and powerful. Our solution is a biofertiliser containing engineered Azospirillum brasilense that tackles the negative effects of waterlogging by mitigating harmful stress responses in plants and promoting nutrient retention in soil. It must be applied once during sowing, aiding crops throughout their life.
Through the year, we’ve been improving our product based on our stakeholders’ feedback. We have reached out to potential users (farmers affected by waterlogging), regulatory and legal experts (Dr. Madhumita Kothari) as well as our peers in the agri-tech industry (To learn more see Human Practices). We have evaluated their feedback and our product will be in the following form:
1. Description: It will be both powder based and liquid-based biofertiliser with genetically-modified azospirillum in it to alleviate waterlogging stress in crops.
2. Application: For agricultural purposes; can be used as a normal fertiliser even if the area does not face waterlogging.
3. Storage and shelf life: Powder-based biofertiliser - 6 months
Liquid-based biofertiliser - 2 years
4. Normatives: Has to get regulatory approval from the GEAC and state bodies.
5. Shipping: Will be shipped to distributors in the form of packets of 1/2/3 kgs and plastic bottles of 1/2 litres. None of it will be distributed without proper packaging.
The packets and bottles will have a label with the description in English and in local languages. The biosafety hazards (if any) will be clearly mentioned. The carrier material used will be sterilised composted sawdust as it will ensure good growth and survival of the inoculant strains. Other materials as carriers will be tested to see which fits the modified Azospirillum best.
Price of the Product
Our startup's vision is to develop solutions for the disadvantaged farmers of the country. Hence the price of our product must be affordable to a vast majority of the farmers. The price must also be competitive with other contemporary products.
Our running costs would include: intial culture costs, manufacturing costs, repair and maintenance of the manufacturing setup, packaging costs, distribution network costs (freight charges, salaries of sales agents), marketing costs, quality assurance, research and development costs and salaries of workers.
After analysing our costs and our vision, we predict the cost of our product to be 50 rupees per kg (0.6 USD).
Business Plan
Canvas Model
Customer Discovery
Waterlogging is a devastating agricultural problem in India : it leads to 2 million tonnes of food grain production being lost annually[3]. Our startup's main objective is to help the farmers affected. Hence, our primary customers would be these farmers.
Current solutions to water-logging are: elevating the farmland or creating mechanical barriers around the field—both of which are unfeasible. Flooding is often unpredictable, making timely erection of temporary mechanical barriers difficult. Alternately, raising farmland is expensive. On the other hand, Hydrazome is a long-term, self-sustaining solution against waterlogging that requires a low frequency of application and is effective regardless of when flooding occurs.
We will take an integrated approach while reaching out to the farmers. We will have a website and a toll-free phone number where the farmers can directly buy our product. We will also be reaching out to farmers via Krishi Vigyan Kendra (KVKs), which are organizations dedicated to teaching agricultural science to farmers.
We would also be looking at the Central and State Governments of India as potential customers. The Central and State governments are actively promoting bio-fertilizers and would like a solution to the crisis of waterlogging. Waterlogging is huge burden on the government with a prime example being Maharshtra (a state in India) which gave a compensation package of 1 billion USD to farmers after the land was damaged by intense rainfall.
Patent and Regulation
To create a viable and successful business enterprise, one needs to protect their ideas and intellectual property. Our startup would patent its technology and its ideas following The Patents Act, 1970. To learn more, one of our teammates attended the IP awareness/training program held by the Intellectual Office,India.
We would be soon filing a provisional patent to protect our technology. We will be guided by Dr. Shweta Uttam, the CEO of Atal Incubation Centre (AIC) SEED who is also a registered patent agent.
The biggest initial hurdle for our startup would be the regulations surrounding biofertilizers and Genetically Modified Organisms. To overcome this challenge, we are in constant touch with regulatory and legal experts (Dr. Madhumita Kothari and Ms. Ashwini Pandharipande).
India is probably amongst the very few countries with the most complete legal framework related to biofertilizers. The Indian Ministry of Agriculture issued an order in 2006 (which was amended in 2009) which included biofertilizers under the Essential Commodities Act (1955), and within the order for the control of fertilisers of 1985. The Fertiliser Control Order (1985) also has special provision for Azospirillum. On the other hand, Genetically Modified Organisms are regulated under the Environmental Protection Act, 1986. These rules are enforced through six different regulatory bodies and at the top lies the Genetic Engineering Appraisal Committee (GEAC) under the Ministry of Environment, Forest and Climate Change. The Department of Biotechnology which operates under the Ministry of Science and Technology plays an important advisory role.
We are in touch with the Ethics Committee of IISER Pune and we would soon be applying to the aforementioned regulatory authorities for testing our product in different farms and crops.
Scalability and Sustainability
Our potential business is highly scalable and sustainable. Firstly, the production means for our product already exists. There is already a manufacturing unit in place that can produce biofertilisers. There is an existing distribution unit with agents who are already in close contact with the farmers along with the country-wide network of KVK centers which we can use for scaling up our business. All we would need to do is to introduce bioreactors in the production line for producing the genetically modified Azospirillum. We will prioritise waterlogging and drought hotspots. With the increasing demand for biofertilisers as they are safer to the environment, we will need to scale it up to other parts of the country in the next 10 years.
We will be using e-Kraft bags for packaging which are biodegradable. Also, biofertilisers improve and maintain the soil quality unlike chemical fertilisers which destry soil quality with repeated use. Chemical fertilisers deplete soil nutrition and may also cause soil and water solution. Our product is sustainable as we are genetically modifying a naturally present soil bacterium which is beneficial to the plants. Also, our product has to be applied only once during the sowing season which adds to its sustainable qualities.
SWOT analysis
Pitch Deck
Risk Assessment
| Area | Goal | Risk Level | Situation |
|---|---|---|---|
| Possible Areas of Risk | Very low to very high | Where your startup stands today | |
| Product/Market fit B2B | Use pre-existing manufacturing chains for production in the beginning phase | Medium | During our very initial phase of sponsorship, we stayed in touch with an international agri-tech company. They were very impressed by our idea. The core principle of our product is sustainibility, which is a very trending topic in the global market. We are confident that there will be many interested candidates who will take up the manufacturing of a novel biofertiliser containing our modified bacteria. |
| Product/Market fit B2C | Once we get enough capital for our own bioreactor, staff, and other things we will have our own production chain. | High | Assembling a trustworthy team and them setting up a fully functional research and development unit is both time-, labour- and, most importantly capital- intensive. We are ambitious about our project and will set out for funding right away. The boost of confidence that we will get from potential inverstors after B2B will be instrumental in converting our business to B2C. |
| Product/Market fit Churn (Churn rate is the percentage of your customers that leave your service over a given time period) | Low | Emphasising here on sustainibilty, climate change, food shortages, and need for innovation. Our product is sustainable and has diverse applications which means our pool of target customers is very large. | |
| Product quality | Our Wet Lab and Dry Lab departments are working on every possible optimisation | Low | We are at the very end of our initial research and development work and a clone which is the modified bacteria is already in place. Very soon we will begin testing our product outside of laboratory conditions and do a second round of optimisation. |
| Team | Interdisciplinary team, Scientists and PhD mentors | Low | We have with us a team of people from different streams and expert scientists who have decades of experience in their field. |
| Sales | We have got very optimistic responses during our pitches. | Medium | We have conducted interviews and surveys with our target customers. In conclusion, we know our product will well-received and in demand. |
| Market | There is no sustainable solution that tackles this problem. | Medium | Our product brings many unique qualities to the table such as sustainability, environment friendliness, and cost effectiveness. That give us the opportunity to sell to a vast market of biofertilisers. |
| Funding | We have enough capital to sustain our work until our model organism is developed. | Medium | As a team, during our project, we have received Rs. 28,00,000 in funding from companies and grants. We are a pre-incubatee at the Atal Incubation Centre and we are constantly networking with their help. This gives us a leverage when it comes to pitching to potential investors for funding. |
| Short-Term Competition | Big player in agri-tech | High | We have met authorities from international agri-tech companies and they have the best of resources and research. |
| Long-Term Competition | Sustainability | Low | Our product is sustainable, environment friendly, cost effective and solves many problems in one. We are going to take these values forward and we believe that eventually our customers will start understanding the ingenuity of our product. |
Market Analysis
There are a lot of local and global companies in the fertiliser industry who have started focussing on biofertiliser manufacturing due to increased need of sustainable agriculture.
Some of the major players in the fertilizer market and their market shares are:
1. IFFCO(Indian Farmers Fertiliser Cooperative Limited) - 68%
2. Coromandel Fertilisers - 15.7%
3. Chambal Fertilisers - 6.4%
4. Rashtriya Chemicals and Fertilisers - 3.04%
5. Deepak Fertilisers - 0.2%
6. National Fertilisers - 0.01%
7. Others - 6.65%
Note: All the calculations have been done with respect to NPK fertilisers for 2020-21.
This is a competitor analysis table between Hydrazome and IFFCO (based on biofertilisers and general company structure only) manufactured by IFFCO. All the scores are out of 5.
| Hydrazome | IFFCO | |
|---|---|---|
| Innovation | 4.5 | 3 |
| Focus on waterlogging | 5 | 0 |
| Focus on Drought | 4 | 0 |
| Gender Diversity | 4 | 2 |
| Outreach | 3 | 5 |
| Affordability | 3.5 | 3.8 |
Stakeholder Analysis
List of Stakeholders
Understanding Stakeholders
| Stakeholder | Estimated Influence | Estimated Interest |
|---|---|---|
| Team Members | M | H |
| Farmers | H | L |
| KVKs & Agri NGOs | M | M |
| Government | H | L |
| Investors | H | M |
| Distributors & Shopkeepers | M | L |
| Media | M | L |
| Competitors | M | M |
| Agri Experts | M | H |
Key : L - Low, M - Medium, H - High
Incubating our Startup
Incubator
Hydrazome has been registered as a pre-incubatee at Atal Incubation Centre(AIC) SEED. AIC is a flagship Central Government initiative to promote the culture of innovation and entrepreneurship in India. These centres aim to foster and support world class innovation, and dynamic entrepreneurs who want to build scalable and sustainable enterprises. As a pre-incubatee, we have received their guidance and advice to develop our research into an innovative agro-tech startup. We will be working closely with them to register as a startup after the iGEM competition and help in creating a difference to the lives of the affected farmers.
Funding
As a newly formed startup, we would need funding from multiple sources for laboratory, regulatory and operational purposes. In the immediate future, we would need capital for the registration of the company, patent filing and lab equipments.
We have approached companies, philanthropists and interested people for raising funds for the iGEM competition and our product and the results have been majorly favourable. We have also participated in multiple entrepreneurship competitions which have been the major part of our funding. The competitions and results have been described below:
1. AIC-SEED StEP (Student Entrepreneurship Program) Competition: We participated in the flagship entrepreneurship competition organised by Atal Incubation Centre and won the first prize of Rs. 300,000 (USD 4000). This competition had two rounds: a screening round and the final pitching round where we pitched in front of an esteemed jury. Our team members also became StEP fellows where they will get an immersive training in entrepreneurship.
2. Pravega Innovation Summit: It is one of the largest and prestigious entrepreneurship competitions in India with 120 teams participating. We cleared the initial screening and went to IISc in Bangalore to pitch our product. We were selected in the top 8 teams in the competition.
3. National Bio-Entrepreneurship Competition (NBEC): We have applied for NBEC and we are aiming to win the grand prize of Rs. 100,000 (about USD 1,300).
Entrepreneurship Training
As StEP fellows, our team members are undergoing comprehensive training under the Atal Incubation Centre. We have learnt how to register as a company and how to patent our technology. We have also learnt how to define our future goals and our vision for our startup. This support from the Atal Incubation Centre SEED has been an invaluable resource for our team.
Future
Timeline
Year 1: Our first year will focus on improving and optimising our technology. We also plan to protect our technology by strategically filing patent applications and maintaining trade secrets.
Year 2-4: We plan to raise funding to setup our expansive automated manufacturing setup by contacting angel investors, venture capitalists as well as crowdfunding. We also plan to partner with different organisations and companies to start field trials. Our field trials will encompass different crops and different soil types. We will also create a marketing strategy to target our customer segments and start building partners and a loyal customer base. We will start deploying prototypes to these customers.
Year 5: We will build our manufacturing setup and begin the production of our biofertiliser. The setup will be optimised for a least carbon-intensive production.
Year 8: We hope to breakeven at this stage. We will continue optimising our technology as well as the manufacturing setup.
Year 10: We plan to extend our technology to other popular biofertilisers like Rhizobium.
Future Expansion
We plan to expand our waterlogging solution to other popular biofertilisers soon. Our next target would be Rhizobium and we will soon start working on it.
Hydrazome also has broader, more ambitious plans for the future. We aim to develop into an agricultural biotechnology company developing solutions against climate change. We would strive to tackle the challenges on food security brought about by climate change including drought, flooding, soil erosion and forest fires. Our goal is to utilise the power of synthetic biology.
Long Term Impact
Beneficial Impact:
Hydrazome will revolutionise the biofertiliser and agro-tech industry. Our solution would be the first scalable and sustainable technology against waterlogging. It will help millions of farmers in improving their crop yield and increasing food security in the country. India loses nearly 12,000 tonnes of food every year due to waterlogging. Hydrazome will offset this number and bring more food on the table of India's rapidly growing population.
We also hope that Hydrazome will create a disruption in the fertiliser industry and bring about climate change-resilient products. As the global temperatures are rising at its fastest pace ever, it is imperative that we find solutions which can counter or at least manage the harmful effects of climate change. We hope that Hydrazome can catalyse this change.
Possible Harmful Impact:
Our product is a genetically modified organism with the acdS gene being present in a plasmid. There is a risk of it being leaked into the environment which will not only be harmful to the environment, but also violate regulations. We are planning on developing two strategies to manage the leak:
a) Genome Integration: We aim to insert the acdS gene construct directly into the genome which will eliminate the risk of horizontal gene transfer.
b). Kill Switch: We are also planning on developing a toxin-antitoxin-based system to prevent horizontal gene transfer.
There is also a threat of our product disturbing the ecosystem by rapid proliferation because of the advantage conferred by our gene construct. This seems unlikely as our metabolic modelling results(See Metabolic Modelling) show that our gene insertion confers a metabolic load on Azospirillum. Additionally, we are planning to develop a quorum sensing-based kill switch that can check the bacterial growth when it crosses a certain population.
References
[1] How to Feed the World in 2050
[2] 2.5% of GDP: India's annual economic loss due to degraded land in 2014-15
