Good Earth raises money on Birchal with plans to shake up the global dairy sector
Food & Agriculture
Food & Agriculture
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Good Earth Dairy is open for investment through the Birchal crowdfunding platform as it scales up for its next phase of growth.
The company is open for investment through the Birchal crowdfunding platform as it scales up for its next phase of growth
Since 2015, WA-based Good Earth Dairy has been refining its product development strategy based on the unique attributes of camel milk.
And having moved from development to commercialisation, the company now has plans to leverage its first-mover advantage with a major scale-up to meet a global market opportunity.
Stockhead caught up with Good Earth CEO Marcel Steingiesser this week, as the company takes Expressions of Interest on the Birchal crowdfunding platform with plans to an additional $1-$2m to fund its next phase of growth.
The dairy sector has seen commercialisation attempts for different milk sources over the years to compete with cow milk.
Goat milk has had incredible success in the infant formula space due to the milk being closer to mother’s milk than cow milk.
Camel milk may be more successful in this space as with lower quantities of casein than cow and goat, it is even closer in composition to mother’s milk which is made up of 99% whey, so not much casein at all.
Steingiesser and the Good Earth team, have identified the significant product differentiation that camel milk has over the competitors and as such invested over $5m over the last +5 years to develop and prove out its technology to produce camel milk at the lowest prices and become a global producer for this future commodity
“Camel milk is free from the key protein allergen in all other milks and has more nutrition than cow milk,” he said.
He cited the move away from dairy products to alternatives such as soy milk. But that’s “not necessarily because they’re vegan,” Steingiesser said. “It’s often because they’re struggling with digesting dairy.”
Just as importantly, Good Earth has developed its product so that “taste-wise, it can’t be distinguished from cow milk”.
“Our goal is to ultimately make it as cheap as cow milk, and we’re making really good progress towards achieving that,” Steingiesser said.
“So we believe that it will be a major disruptor to the dairy industry. And just as importantly, those attributes are also why it can also become the infant formula of choice globally.”
After a multi-year period of technology and product development, Good Earth commenced the commercialisation of its technology last year, when it also carried out its first round of equity crowdfunding.
That marked the “Australian record at the time” for equity crowdfunding, Steingiesser said.
The company now distributes its product to 50 stockists around Australia. And with its next raise, it’s getting ready to deploy capital for a global scale-up.
Good Earth’s near-term plan is to establish its WA-based production facility with 5,000 head of camel, with a full-year production quota of at least 3 million litres of camel milk.
Along with those developments, the company is also on track to receive its export licence and also plans to commence construction of a milk powder facility.
“The goal is to become a major infant formula brand on a global scale. But we also want to become a commodity producer for camel milk powder,” Steingiesser said.
“Effectively it makes us a critical part of the supply chain where other infant formula producers can buy our powder.”
And for Steingiesser – who has a background as a chemical engineer at BHP – it’s also why Good Earth has always been “an innovation company first”.
“That’s why we spent the time to develop the necessary capabilities to be able to enter the market making Australian camel milk powder at low prices,” he said.
Based on its early Expressions of Interest (EOI) on the Birchal platform, Steingiesser said the company is on track to raise a further $1-$2m for its next phase of growth.
That’s in addition to a separate $1m funding recently raised from sophisticated investors at 20c a share – a 30% premium to the first crowdfunding raise last October.
And with an investor base of more than 500 investors, Good Earth has formalised a mandate with a tier one Australian broker to work towards further advancing their global ambitions.
For now, the company is looking to build on its early success on Birchal with its second crowdfunding round
“In in terms of our valuation, it makes sense to bring in another $2-$3m now – most of which we have commitments for — so we have the capital to secure our plans for a 5,000-head dairy farm and commence execution of our powder facility.”
“We’ve also applied for a federal government grant, to support the funding of our $8.8m powder facility,” Steingiesser said.
It adds up to a strong set of tailwinds forming behind the business, as it converts a multi-year development phase to a global market opportunity.
“If you look at the pure powder market in China, camel milk powder is selling for over $120 per tin for 300g of powder,” Steingiesser said.
“On those numbers alone, our annual 3 million-litre production quota will have a current market retail price of over $120m.”
“Our goal is to become premium infant formula brand on a global scale, and also to be a core commodity producer of camel milk powder.”
For more information about the Good Earth Dairy equity crowd funding visit Birchal here.
This article was developed in collaboration with Good Earth Dairy, a Stockhead advertiser at the time of publishing.
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