Episode 53

Pongamia: Reimagining Agriculture

with Naveen Sikka

November 15, 2022

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Naveen Sikka
Founder & CEO, Terviva

Naveen Sikka is the founder and CEO of TerViva, a food and agriculture technology company that is building a more sustainable plant protein and vegetable oil supply chain. He is also a member of the Board of Directors for Elemental Excelerator and a Fellow for Unreasonable Impact Americas. Previously, Naveen worked as a management consultant at Gemini Consulting and TPI. He received a bachelor’s from Columbia University and an MBA from UC Berkeley.



The silver lining is that the world recognizes climate change as a real existential threat. And, in particular, businesses do.



[00:00:00] Rishi Sikka, M.D.: Hi, I’m Rishi Sikka, one of the hosts for the Day Zero podcast, and I am so thrilled today to be interviewing one of my favorite people in the world. My brother Naveen Sikka, who is the CEO and co-founder of Terviva and Naveen. Just so excited to have you here today. It’s just making me beam on my face. Thank you so much.

[00:00:24] Naveen Sikka: It’s great to be here and congratulations for being elected the new Prime Minister of the United Kingdom.

[00:00:29] Rishi Sikka, M.D.: Oh, that’s the other wishy. , that’s the other. But now my name and my first name will be known it be folks, the

[00:00:37] Naveen Sikka: I now know two high achieving wishes of my life.

[00:00:40] Rishi Sikka, M.D.: That’s really kind for our viewers. He is my younger brother, but in many ways more accomplished, certainly more gifted. So thanks again, Naveen. You know, I think folks are gonna probably be asking at the start, why are you coming to speak on a healthcare podcast? Terviva is a food company. Why is that the case? And I, I know the area of food as medicine is a, is very hot, very topical right now. But, I was of going through some notes and it’s actually a really old concept. With that, just of, let’s set the table a little bit and tell us about what Terviva Viva does.

[00:01:14] Naveen Sikka: Food is medicine. Food has always been medicine, right? If you think. The ancient times in Ive medicine and Chinese Eastern medicine people ate things or utilize plants to help heal them. And in fact, the tree that Terviva works with, it’s called the p gaia tree, has its roots in eastern medicine, in Ive medicine. This is a tree that produces beans. It’s in the lagoon family, so the same family as soybeans, broad genetic family as soybean. Spin around for millennia. It’s written up in the I by the texts because the beans had medicinal value. What Terviva is doing is taking this beautiful tree that grows really well on poor quality land, and we’re doing two things. One is that we’re stabilizing the yields of this tree. It does grow well on poor quality land, but it yields erratically like a lot of crops that are of this sort of nature, not fully domesticated. The other thing we’re doing is we are taking the niche uses of the. For medicine and we’re upgrading into broader market usage of these beans. So today we use agriculture not just for food, but also for feed and for energy, for fuel. And we’re basically taking the PGA tree and taking it from its niche, medicinal uses and bringing it into all of those markets. A difficult thing to do to bring a new crop to the world, but I think a necessary thing given, where we are with our food system.

[00:02:33] Rishi Sikka, M.D.: Yeah, that, that is a great overview in just setting the frame for our conversations. Like me, you’re a very mission driven leader and I think when I’ve seen you speak, Personally and in public and when I’ve gone on your website that aspect of what you’re trying to do from a mission perspective really pervades. I was wondering if you could just talk just a little bit about that aspect of mission for you and the company and how you see something even bigger that you’re trying and aspiring to.

[00:02:59] Naveen Sikka: If you look back at the last 10 years of building Terviva, you could argue that it was inevitable that we would get to this point, right? It’s a really great tree crop, and the markets are really in our favor. Everybody wants to see things grown sustainably, and everybody wants a more plant-based diet and everybody realizes that, agriculture needs to be less environmentally harmful, right? And when we started this, none of those things were. We started the company on the basic premise that, , it would be good to try to achieve some of these outcomes, and if we didn’t make it, it would be okay just for trying. I think you get halfway through the journey, five years in, and you start to realize that it, it becomes all about the mission at that point as you start to have success and you realize that if you don’t focus even more on the mission you might take an alternative pathway to growing your company that is not in service of the mission. And we see this a lot of times with companies. They get to commercial frontiers and they have to abandon some aspect of their mission to achieve commercial outcomes. We’ve been fortunate to be able to continue to build this idea. Of, truly regenerative food production and degraded land in poor communities throughout our whole journey. It’s not easy to stay on mission. I think we started because it was easy. It’s always easy to start with a mission. I think it’s hard to stay on mission, and I feel, really fortunate that a lot of circumstances have aligned to let us do that.

[00:04:19] Rishi Sikka, M.D.: You know when you were a kid, I remember when we’d go back and visit family in India and they’d ask you, What were you gonna be when you grew up? You would always joke, I’m gonna become a farmer. Used to actually say it in Hindi. You ever look back on that moment as as you were just you were just either a smart, or you were just maybe prescient in some respect and your connection to the earth Now

[00:04:40] Naveen Sikka: I think as one of. Amazing things about growing up in our household, you and I being the children of hardworking immigrants, a doctor and an engineer that came over from India and built, a new life for themselves and for us here, it’s incredible with how much they, struggled to build a life here. How much latitude they gave both you and I to choose paths that we wanted. It all comes from. As you know them giving you and I both the flexibility to build our own journeys. And yeah, I don’t think I ever really saw myself in the spot I am now, but I always knew, I always felt supported by our parents and by you to pick the pathway that felt best for me.

[00:05:27] Rishi Sikka, M.D.: Two transitions that you’ve undergone over the course of the company. First one is a topic we actually talk a lot about in Day Zero, which is very important for first time entrepreneurs, a critical core competency. And this is an issue of product market fit and really establishing that product market fit as soon as possible or pivoting as the case may be. Talk to us a little bit about Terviva’s journey on product market fit. You started one place. In energy you’ve moved to another place. Talk about that journey, both from a company perspective and if you can also from a your mindset perspective too, as the CEO, co-founder.

[00:06:02] Naveen Sikka: When, as I mentioned, when we started building Terviva, we knew we had two objective. Deliver One was to make this crop actually physically work, right? It does grow around the world. It does produce beans, but nobody had done the work to make it produce beans consistently on that poor quality of land. And then the second thing was to take those niche, those niche markets, medicinal markets for which the beans are used, and to upgrade into larger markets. So that’s a lot for a small company to do. And quite honestly It wasn’t clear we could raise the kind of money we needed right off the bat to do that. I think now there’s so much interest in capital in these kinds of businesses, but when we started in 2010, it wasn’t that clear that capital could form for a business like this. So we chose to focus on the first one which was the plant breeding, plant genetics part of the business. And the easiest thing to do in the second bucket with. Basically these beans that had medicinal uses was to use that oil for biofuel. It’s a very drop in application. You could just take the crude vegetable oil, which had a very strong bitterness medicinal value, but very strong bitterness and to put it right into biofuel. So it was a choice of convenience early on, quite honestly, to take our limited capital. In the early years and to focus it in the one area that we felt would really unlock the growth for the business, which was to work with farmers to prove that the tree could grow well. And then once we proved the tree could grow well, then we could put more money to work on diverse applications beyond biofuel. That was always the plan. Early on, I think what happened, unfortunately for us, what happened is as we put all of our money, On the crop side of it, the tree growing side of it, the biofuel market, which was attractive when we started, actually collapsed. So we had a dilemma at that point, which was, what do we do? Nobody really wants to buy our biofuel per se, and it’s not very profitable now to do so because the pricing has collapsed. And so we were fortunate, this is around 20 15, 20 16, that there. A new movement in this whole plant-based food space. These were the, this is the early days of companies like Impossible Foods and Beyond Meat. In fact, it was one of our investors who’s now our board chair Ron Edwards, who was in the founding team of a pet food company named Blue Buffalo. It’s a pretty well known brand of pet food, and he was an investor in Terviva, and he told me that historically an ingredient called yellow Pee was, which was used for dog food, was now they were compet. For supply for yellow P with food companies. And he was the one who came to me and he said, You oughta think about trying to see if you could make P Gaia beans into food. And I didn’t think it was really possible. I was worried about this because these beans had been around for millennia. And sure we could use it for biofuel, maybe even for livestock feed, but could we take it all the way to food? Why wouldn’t somebody have done this before us if it was possible? And and yet we knew that if we could make it into food, there’s no better of a pull through in the market to really stimulate interest in what you’re doing than consumers and consumers. You could sell all the biofuel you want, but nobody goes to the pump buying a particular type of fuel, let’s face it. Everybody’s going to the pump. Everybody’s going to the grocery store. So grocery store though, to buy a particular type of food. . So again, this is one of the many instances of luck in Terviva. We were able to successfully scale up the production of these beans into the food supply chain and that pivot from fuel or biofuel to food really unlocked. Bigger picture thinking for our company with bigger stakeholders in our system, like NGOs and of course investors. Governments that suddenly are like, Wow, you can help solve problems related to food security. You can help solve problems related to climate change emissions from our food supply.

[00:09:53] Rishi Sikka, M.D.: Naveen and I I loved hearing that story. I obviously over the years would hear about it in an incremental way, but just hearing that a. And being able to look back. It’s just a tremendous story. It’s also a story of resilience. A story of some curiosity on your part that, somebody’s saying something and you’re willing to explore.

We’ve seen that with other people on day zero and then,

[00:10:15] Naveen Sikka: I should add one thing in there too, cuz it, it takes a real team, as I have my dear friend and my co-founder Sudir in this company, and he’s been with me from the very beginning. And one of the things that’s amazing about him is that he brings what I call a day zero mindset. To the job. He was the one that was all as, I was worried. I was like, Oh my gosh, we could fail here. We could put all this money to work and never make food. He was the one that sort of sat, sat right next to me and said, Let’s just go for it. Like he, he had no qualms about abandoning the history and pushing for what was better. It takes a whole team to make this pivot is what I.

[00:10:46] Rishi Sikka, M.D.: Yeah. No, that is a wonderful reminder that it’s a team, it’s curiosity, it’s resilience and bringing that kind of thing into the culture of the company. Wonderful to hear that arc of that pivot. And again, hearing the importance of product market fit. It, it seemed like one day you were domestic, so to speak, and then, obviously it, it is truly incremental. You have become a global company and I think that’s something that both from a market and supply chain standpoint, many entrepreneurs and many of the folks who watch Day Zero aspire to tell us a little bit about that from going. US centric thinking to becoming truly a global company.

[00:11:25] Naveen Sikka: Let me take a step back and come back to the mission here. And actually pull together to your initial quote about food as medicine. There have been amazing things that have happened with our food system in the last 50, 60 years, and there have been things that have been not so great about it. The amazing things are that, we went from the 1950s pretty much onward in an era called the Green Revolution. We went from food scarcity basically an inability to feed the world, actually being able to feed the world. The other thing that’s happened though, as a result, Concentrating down our access to a negative consequence. Besides the lack of biological diversity is we’ve had nutritional issues, right? We have a lot more nutritional issues from cheap, always available food that we didn’t historically have. Case in point, we don’t eat soybeans or corn as humans, but we do use it to feed animals. We’ve made that production, 60% of the cost of making meat comes from what you feed the animal before you eat it. You lower those costs, you lower the cost of the meat, you feed them in confined operations, you get really cheap meat. So once we broke through on being able to make food we have this crop. One of the interesting things about p Gaia is that it, it grows on land where soybeans don’t. It grows in a totally different type of footprint, but we produce similar types of outputs. So if you’re thinking about continuing the good legacy of agriculture where you make a lot of food everywhere and for cheap, but you wanna solve the issues of high concentration of supply in a few parts of the world and nutritional issues. You gotta think about farming it differently. So in the US we farm in a monoculture format. We farm literally a hundred thousand acres of corn and a hundred thousand acres of soybeans all in singular blocks, basically, right? When you go to other places in the world, like Africa, like India, when you’re working on a hundred thousand acres, you’re literally working with a hundred thousand. It’s highly fragmented, right? Highly fragmented. One family works one acre or two acres, right? That system of farming is called agro forestry, and it’s a more diverse system of farming. You’re doing multiple things on the field. You’re growing doll, you’re growing corn, you’re growing grass, you’re growing tree crops, right? And so the moment we figured out that we could make food, we had a choice. Were we gonna, were we gonna farm it in that old monoculture? All these things on one acre or are we gonna try to take it somewhere where we knew it could really help unlock regionalized supply, right? Something that we know needs to change and help support a more diversified cropping system. Again, tough, but I am super, super committed to, once we get Terviva to the point where, everybody knows that it’s achieved all the successes we wanted, that those successes were aligned with the what kind of future we wanna.

[00:14:03] Rishi Sikka, M.D.: From a macroeconomic perspective tell us a little bit about, how you are looking at this uncertainty, things you’re thinking about, either that you’ve done or will be thinking about from a proactive standpoint to navigate navigate this time.

[00:14:18] Naveen Sikka: The world recognizes climate change as a real existential. And in particular, businesses do. So businesses around the world are making commitments to being net zero by this point. Whether it’s an energy like literally like petroleum companies or food companies or technology companies, everybody’s making these commitments and they have committed not just to do that for themselves, but they’ve committed to invest in this area. While at the same time, financial capital is really pulling back cuz the cost of capital is going up. Corporations have become the key strategic investors in our space. And the optimism comes from the fact that quite honestly, the right pathway to scaling our impacts is through working with these corporations in the first place, the incumbents and now they’re willing to invest. So that’s the optimistic part of it. I think the pessimistic part of it, quite honestly. The old traditional Wall Street capital that, we all relied upon pretty heavily over the next five years that is gonna be much, much harder to pull together.

[00:15:15] Rishi Sikka, M.D.: That’s a great framing. As we start to wrap up to our two last questions I do want to give you a chance to just share the good news what’s the next 12 to 18 months look like. For Terviva, I know it was a little while ago, but you had a. Big article in the Wall Street Journal about a, about an agreement with what’s, what can we expect from Terviva Viva? When are we gonna get some pia oil on our shells? What do you what’s the future? Tell us the outlook here.

[00:15:38] Naveen Sikka: Yeah it’s time to get product into the market. So we we actually just announced this week our first distribution agreement of what we call Pan Nova Oil, which is Edible p Gaia Oil in the market. It’s with a company called Soranda. They’re going to be basically taking wholesale oil from us and then working with their customers, which are the Dinos and Cliff Bars and General Mills of the world, and they’re gonna get our oil into their products. So we have a great partner there. . There will be, I probably can’t sure what it is, but there will be a, a product you can buy using Pin Nova Oil. Actually a protein bar you can buy using Pin Nova Oil in early next year. So that’ll be the first kind of cons composed product you’ll be able to see in the market. And then later on in the year, you’ll see Pin Nova oil appear in, in food service and restaurants. And in probably a couple of. Types of products as we scale up production, so that’s very exciting. The other part of our business that we focus on while we make edible food products is we focus on tree plantings. And we are going to be expanding from our core US footprint of tree plantings into particular India and Australia with larger plantings. The India acreage is around agro forestry like plant. Few amounts of trees with lots of people. And that, that’s very exciting for us. And one of the nice, co-benefits of doing those plantings is the ability to generate what we call carbon credits out of those plantings, which is a monetizable way to of prove that you’re having that carbon sequestration impact. So the combination of tree plantings and carbon credits plus first food products, making it into the market that’s what the next 12 months look like for us and really, frankly, just weathering this economy. Trying to work together with, the industry, so to speak, to prove that you can continue to scale these businesses across any kind of macroeconomic.

[00:17:19] Rishi Sikka, M.D.: yeah. No, thank you for reminding us about the brass tack and then the great news that’s coming up. You’ve been through a tremendous tremendous journey, a tremendous experience here. If you could go back in time and. And talk to your younger self, maybe let’s say 15 ish years ago or so what would you wanna say to your younger self?

[00:17:39] Naveen Sikka: Sticking to the sort of core theme of. An entrepreneur, I think. Yeah. I think one thing I didn’t do as good of a job of early on is, I think I do a better job of it now is being very focused. All entrepreneurs have the same challenge early on, which is to try to please a lot of different constituencies as you can. As you try to find that product market fit, you you have seven or eight good ideas out there to try to see which one is gonna. You can get, you can get growth on that is really dilutive to capital to focus. I think, you have to really focus on what the market is gonna fund. Even if you think your idea is great, you gotta find that careful intersection of what you’re good at, what you believe in from a mission perspective and what the market is gonna fund, right? I think a lot of entrepreneurs. Tend not to focus enough on the last one, tend to spread their bets out a little bit when you’re probably better off focusing on one or two bets that just help you do the other two things Which is build the technology and build the mission. Focus on what that market momentum is rather than trying to create momentum on your own. I think a, that’s a lesson we had to learn. We probably could have pivoted to food. Earlier, frankly I just think that, we wanted to have a lot of irons in the fire and keep some legacy things going longer than maybe we should have. I think you only have, I think you have to go through it to know that’s what’s needed. You need to have experienced success and have the courage to be more thoughtful with your bets. But I, when I talk to entrepreneurs today, that’s what I always tell them. I’m like, What? What is the real product or two you need to do, not the five. That are gonna help you get to the next point of your.

[00:19:14] Rishi Sikka, M.D.: Naveen. That is a great close for this session of day zero. Just reflecting on that aspect of focus on what. Is the mission, What do you do well, What sort of the economic engine and that coupled with the advice you gave on fundraising and just this tremendous arc about not just the, something that’s near and dear to me. Not just being authentic to mission, but the power of staying with mission and leading by mission and the great things that it can. For a company and for a global marketplace. You, your team, Terviva are powerful reminders of that can’t wait to see Terviva products in our hands, in the supermarket, in the time to come. Thank you so much for being on Day Zero. This was awesome and special. Great

[00:20:01] Naveen Sikka: to be together with you here.

[00:20:03] Rishi Sikka, M.D.: Oh likewise. Thank you so much.

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