Middle East start-up that grows food in the desert raises $60 million in funding

A migrant worker walks past rows of tomato plants growing in a smart greenhouse at Pure Harvest Smart Farms in Nahil, United Arab Emirates, on May 20, 2020.

Christopher Pike | Bloomberg | Getty Images

An Abu Dhabi-based agriculture technology start-up announced it has secured $60 million in funding to expand its Middle East operations, but said it has been an uphill task trying to raise capital.

Pure Harvest Smart Farms grows fruits and vegetables in greenhouses in the United Arab Emirates desert, and has partnerships to do the same in Saudi Arabia and Kuwait.

The harsh Middle East climate makes countries in the region heavily reliant on food imports, and the Covid-19 pandemic last year brought food security risks to the fore.

“Our pilot in the desert … showed very promising results — the potential for year-round local production at very high quality and at a very good cost structure,” CEO and Co-founder Sky Kurtz told CNBC’s “Capital Connection” on Monday. The start-up will use the capital to build its beachhead in Saudi Arabia, he added.

It also has plans to expand its portfolio of produce.

The company raised $50 million via Islamic bonds, also known as sukuk, which are debt instruments that comply with Shariah law. Kurtz said it was “quite novel” given that the region doesn’t have a significant venture debt market.

The issuance was led by Shuaa Capital and accommodates Pure Harvest’s longer-term needs for an “aggressive capex program” as well as its fast-growing nature, Kurtz said.

Separately, Sancta Capital led a equity fundraising round in January that raised another $10 million, with participation from new and existing investors.

‘Relatively underfunded’

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

%d bloggers like this: