Blockchain + farming = BlockGrain in first Aussie agriculture ICO
Food & Agriculture
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BlockGrain, a software solution to automate the sharing of information across agriculture supply chains, just raised $3.5 million from private investors.
The start-up is also launching Australia’s first ICO (or initial coin offering) in the agriculture industry, looking for $25 million.
An ICO is like an initial public offering — but instead of offering shares in a company, an issuer offers digital tokens that can be redeemed for services or traded on cryptocurrency platforms.
BlockGrain allows farmers, their brokers and logistic companies to track grain from a farm during harvest to an end user. It also provides farmers the ability to create, manage and track commodity contracts.
It is estimated 30 per cent of the value in bulk commodities is lost due to inefficient supply chains and intermediaries in western economies. This figure increases to 50 per cent in the developing world.
The company has already been backed by RiseAgri, Australia’s largest group of independent grain brokers, as its first major client.
But they are prioritising retail investors — removing the high minimum cap on investments imposed on many token sales. BlockGrain is encouraging interested parties to participate in the project for as little as $500 or 0.5 Ethereum cryptocurrency.
Funds raised will be used to expand BlockGrain’s presence in Australia and overseas.
BlockGrain is a play on “blockchain” — a much-hyped technology that provides an encrypted, public ledger of transactions. It’s best known as the basis of cryptocurrencies such as bitcoin but has other potential applications such as securing public records or enforcing contracts.
Founders Caile Ditterich and Sam Webb want to increase transparency and paddock-to-plate traceability of produce. Ditterich was born on a family farm in Victoria and has 15 years experience in the grains industry.
Ditterich says the complexity in the agriculture supply chain results in major inefficiencies and productivity issues for farmers, brokers and logistics companies.
“This is how the concept of BlockGrain was formed. It was created with the mission to solve real-life problems faced by our agriculture industry today in real-time,” he says.
“Our public token sale is giving everyday consumers the opportunity to provide the farming industry with the tools and resources it needs to continue being the backbone of our society.
“As we reach a stage of excessive product proliferation, both manufacturers and consumers alike are looking for the next level of differentiation. We believe this will come through our secure paddock-to-plate traceability allowing for single-origin products to be adopted at a mass scale.”
BlockGrain advised by Martin Davidson and Anouk Pinchetti from Melbourne’s Blockchain Centre, Gerard Toscan, the key founder of a greenfield cotton gin, and Brendan Stewart, former Chairman of AWB, Australia’s largest agricultural company and largest grain handler.
BlockGrain is focused on grain and cereal but is also looking at the Australian fruit and wool industry over the next two years.