WEBVTT - Selling Billions of Crickets a Year 0:00:15.316 --> 0:00:23.356 Pushkin. When Mohammed Assure was in medical school back in 0:00:23.436 --> 0:00:26.796 twenty thirteen, he and a few friends heard about this contest. 0:00:27.676 --> 0:00:30.116 The team that came up with the best idea for 0:00:30.156 --> 0:00:34.036 a business to address global food insecurity would win one 0:00:34.116 --> 0:00:37.636 million dollars to launch the business, and, like lots of 0:00:37.676 --> 0:00:41.476 people before them, Mohammed and his friends soon discovered crickets. 0:00:42.036 --> 0:00:44.996 They learned that crickets are a super efficient machine for 0:00:45.116 --> 0:00:50.036 turning grain into protein. Quick comparison, a cow eats eight 0:00:50.076 --> 0:00:53.956 pounds of grain to make one pound of beef. For chicken, 0:00:54.076 --> 0:00:56.356 the ratio's two and a half to one, and for 0:00:56.476 --> 0:01:00.396 crickets the ratio is just one point three to one. 0:01:00.636 --> 0:01:04.076 Incredibly efficient. This is the part of the eating bug 0:01:04.156 --> 0:01:07.276 story that we've heard before, but the problem always seems 0:01:07.316 --> 0:01:09.956 to be how do you get a mayors to eat 0:01:09.956 --> 0:01:14.076 bugs deep crickets. Mohammed's big idea was to avoid that 0:01:14.156 --> 0:01:18.156 problem altogether. Instead, he and his co founders would bring 0:01:18.196 --> 0:01:20.996 down the price of crickets for millions of people in 0:01:21.076 --> 0:01:23.956 other parts of the world where people already eat crickets, 0:01:24.156 --> 0:01:27.476 but where crickets are not always available or affordable. That 0:01:27.596 --> 0:01:30.316 turned out to be a surprisingly hard problem. To solve, 0:01:30.756 --> 0:01:33.116 but the idea was enough to win the million dollar 0:01:33.196 --> 0:01:38.836 prize and launch the business. I'm Jacob Goldstein and this 0:01:38.916 --> 0:01:41.796 is What's your problem. My guest today is Mohammed Assure, 0:01:42.196 --> 0:01:45.836 founder and CEO of Aspire Food Group. The company just 0:01:45.916 --> 0:01:49.236 built the biggest cricket factory in the history of the world. 0:01:49.796 --> 0:01:53.756 Mohammed's problem now, how do you sell billions of crickets 0:01:53.836 --> 0:01:57.236 a year. Today's show is a story about finding your 0:01:57.276 --> 0:02:00.916 market and also about one of my favorite ideas, an 0:02:00.956 --> 0:02:03.916 idea that maybe not surprisingly has become one of the 0:02:03.956 --> 0:02:08.396 recurring themes of this podcast. The idea is this, one 0:02:08.436 --> 0:02:11.996 of the key drivers of human progress is using technology 0:02:12.116 --> 0:02:15.596 to make things cheaper. In this case, the thing technology 0:02:15.676 --> 0:02:21.396 is making cheaper is crickets bugs. When we started the business, 0:02:21.436 --> 0:02:24.676 our goal was not actually from the get go to 0:02:24.796 --> 0:02:29.436 get North Americans eating bugs. In many of the world's countries, 0:02:29.636 --> 0:02:33.676 insects are already consumed as a delicious delicacy that is 0:02:33.756 --> 0:02:36.756 highly nutritious and celebrated. But in many of those countries, 0:02:37.036 --> 0:02:41.036 crickets or other insects are just not available, not affordable seasonal. 0:02:41.276 --> 0:02:42.876 So you want to go to a place where they're 0:02:42.876 --> 0:02:44.876 at delicacy. I mean the reason they're at delicacy is 0:02:44.876 --> 0:02:47.996 because they're expensive, right, Like that's delicacy means. And so 0:02:48.036 --> 0:02:50.636 the idea was, we want to now make this protein 0:02:50.676 --> 0:02:56.116 source which is already accepted here, available and affordable year round. Right. 0:02:56.236 --> 0:02:59.036 Some of those countries I mean, I know famously Wahaka 0:02:59.236 --> 0:03:01.716 right in Mexico. What are some of the other places 0:03:01.716 --> 0:03:04.996 where people at crickets, Oh gosh, I mean in Africa alone, 0:03:05.076 --> 0:03:09.476 you have you know, Gonea, Nigeria, you have South Africa, 0:03:09.796 --> 0:03:12.516 you have Niger. If you go to the Middle East, 0:03:12.516 --> 0:03:14.556 you have Saudi Arabia, you have Kuwait. Like these are 0:03:14.556 --> 0:03:17.116 places where locusts are widely consumed. If you go to Asia, 0:03:17.236 --> 0:03:19.836 you have some of the countries like Thailand and Vietnam. 0:03:19.956 --> 0:03:24.116 And now it's not in every one of these countries. 0:03:24.236 --> 0:03:28.716 There are certain you know, cities or municipalities or areas 0:03:28.716 --> 0:03:31.156 where insects are widely consumed because of their geography or 0:03:31.196 --> 0:03:34.236 their climate, and others less so. But fundamentally, it's a 0:03:34.356 --> 0:03:36.396 very large percentage of the world's countries that have some 0:03:36.556 --> 0:03:40.316 history of consuming insects. So what you want for your 0:03:40.756 --> 0:03:43.436 for your mission really is a place where lots of 0:03:43.476 --> 0:03:45.996 people are hungry, you struggle to have enough food and 0:03:46.076 --> 0:03:50.196 where eating crickets is already normal exactly. That's that's right, 0:03:50.196 --> 0:03:52.276 and that that was our focus from the beginning. And 0:03:52.356 --> 0:03:55.436 so if that was the focus, this is why not 0:03:55.716 --> 0:03:59.036 build the factory there? Yeah. So one of the challenges 0:03:59.116 --> 0:04:01.796 we've faced is we actually tried. So when we first 0:04:01.836 --> 0:04:05.396 started the company, one of my co founders moved to Ghana, 0:04:05.516 --> 0:04:08.036 and one of us moved to Wahaca, Mexico, and I 0:04:08.196 --> 0:04:10.876 moved to Austin, EXUS where we were starting to pilot 0:04:10.916 --> 0:04:14.556 cricket farming. And the challenges we faced is both the 0:04:14.596 --> 0:04:16.876 talent that you needed to have placed there in order 0:04:16.916 --> 0:04:20.796 to build the capability, not just the engineering talent but 0:04:20.836 --> 0:04:23.516 also the entomology talent and the understanding of how to 0:04:23.516 --> 0:04:28.476 grow those insects at scale, and the agricultural requirements to 0:04:28.556 --> 0:04:32.716 regulatory requirements of a lot of factors were very challenging 0:04:32.716 --> 0:04:34.156 to be able to pull off for a bunch of 0:04:34.196 --> 0:04:38.316 like expat foreign students. Okay, so you tried. So the answer, 0:04:38.356 --> 0:04:42.236 as you tried, the answer is too hard to Yeah. Yeah, 0:04:42.276 --> 0:04:44.356 for us, for us as a founding team, given our 0:04:44.396 --> 0:04:47.916 specific circumstances and given some of the realities we were 0:04:48.036 --> 0:04:50.836 we were experiencing at the time, and now when we 0:04:51.036 --> 0:04:53.396 when we decided, okay, well we're going to produce crickets 0:04:53.436 --> 0:04:56.876 in North America and you know, focus perhaps on shipping 0:04:57.156 --> 0:04:59.676 overseas to some of these markets, that's when we also 0:04:59.716 --> 0:05:02.636 started to see this opportunity. And part of this was 0:05:02.716 --> 0:05:05.396 driven by inbound requests. So back in twenty fifteen, right 0:05:05.436 --> 0:05:07.916 around when we built our factory in US, our very 0:05:07.916 --> 0:05:10.756 first facility, there was a bunch of startups that we're 0:05:10.756 --> 0:05:13.116 getting funding on, like shark Tank and a whole bunch 0:05:13.116 --> 0:05:15.036 of others that we're getting, you know, funded on Kickstarter 0:05:15.236 --> 0:05:17.756 very successfully, that we're making, you know, protein bars from 0:05:17.796 --> 0:05:20.956 crickets or other snacks from crickets that we're reaching out 0:05:20.956 --> 0:05:23.716 to us asking us if we can supply them. So, okay, 0:05:23.756 --> 0:05:25.996 you realize you aren't going to be able to build 0:05:25.996 --> 0:05:29.836 a factory somewhere people already eat crickets. You're thinking maybe 0:05:29.836 --> 0:05:32.836 you'll ship them there, but but you also think, well, 0:05:32.876 --> 0:05:34.996 you've got the crickets anyways. People are kind of into 0:05:34.996 --> 0:05:37.236 crickets in the US right now, and you actually try 0:05:37.276 --> 0:05:39.956 this sort of plan B move where you sell bags 0:05:39.956 --> 0:05:42.916 of crickets like chips in the US, right, tell me 0:05:42.916 --> 0:05:46.836 about that. So the idea was simple. It was to 0:05:47.036 --> 0:05:50.076 so try to go on one side where you are 0:05:50.156 --> 0:05:52.716 so explicit about the fact that this is a cricket 0:05:53.116 --> 0:05:55.836 that you actually present it as a snack in whole 0:05:55.876 --> 0:05:58.716 cricket form. Right, So you take these crickets, you roast them, 0:05:58.996 --> 0:06:02.116 you apply seasoning like you know, it's like chips seasoning, right, 0:06:02.116 --> 0:06:05.116 like barbecue or sour cream or whatever, and they would 0:06:05.156 --> 0:06:08.396 be consumed not dissimilarly to something like jerky in the 0:06:08.436 --> 0:06:11.276 sense that it's a very meaty, high protein snack that 0:06:11.396 --> 0:06:14.876 is savory. And it was very interesting to see the 0:06:14.916 --> 0:06:16.996 response we got because you sort of had like a 0:06:17.076 --> 0:06:18.996 certain percentage, and I would say, it's a small but 0:06:19.116 --> 0:06:23.916 extremely dedicated, you know, very devoted following of people who 0:06:24.156 --> 0:06:26.636 found this to be super nutritious and delicious, but of 0:06:26.636 --> 0:06:29.756 course and also made it like their whole identity, like, hey, 0:06:29.756 --> 0:06:31.756 call me cricket, I'm the cricket that I love to 0:06:31.796 --> 0:06:34.836 snack on crickets. Ask me about crickets. Yeah, that's right. 0:06:34.916 --> 0:06:38.676 And they were remarkably popular amongst children in particular. And 0:06:38.716 --> 0:06:40.796 then you had on the flip side. I would say 0:06:40.836 --> 0:06:44.636 a much larger percentage of people whom that was too 0:06:44.716 --> 0:06:47.476 much in terms of like just visually seeing a cricket 0:06:47.476 --> 0:06:48.836 and being able to pick it up and eat it. 0:06:48.916 --> 0:06:51.036 I don't want to eat a bug. Seems like that's right, 0:06:51.196 --> 0:06:54.236 not that surprising response. Yeah, so okay. So at this point, 0:06:54.276 --> 0:06:58.076 like plan A, build a factory where people already eat crickets. 0:06:58.476 --> 0:07:01.636 That didn't work. Plan B, sell crickets to people in 0:07:01.676 --> 0:07:04.236 North America. That's not going great. But then there's this 0:07:04.276 --> 0:07:06.756 moment when you kind of get your big break. Tell 0:07:06.756 --> 0:07:11.596 me about that. We were actually at a food in Anaheim, California. 0:07:12.276 --> 0:07:16.436 We had at the time a large company that primarily 0:07:16.436 --> 0:07:20.716 focuses on pet food, looking for human grade ingredients so 0:07:20.756 --> 0:07:22.996 they could sell some premium thing like give your dog 0:07:23.116 --> 0:07:24.996 chicken that's as good as the chicken you eat, that 0:07:25.076 --> 0:07:28.356 kind of thing exactly, And that led to was this 0:07:28.476 --> 0:07:33.116 unbelievable rabbit hole where we became to understand that Over 0:07:33.156 --> 0:07:36.236 the last decade or so, there has been a two 0:07:36.516 --> 0:07:38.396 major trends in pet food. The first has been the 0:07:38.476 --> 0:07:41.196 humanization of pets. Pets are no longer this furry thing 0:07:41.196 --> 0:07:43.316 that greets you and makes you feel good. It is 0:07:43.396 --> 0:07:45.836 a member of the household, and in most households, the 0:07:45.876 --> 0:07:50.596 favorite child. Yeah. And as a result, when that's your philosophy, 0:07:50.756 --> 0:07:54.356 that means you feed and clothe your pets accordingly. Yeah. 0:07:54.556 --> 0:07:57.076 And the amount of money that people are spending on 0:07:57.116 --> 0:07:59.076 their pets a staggering And by the way, pets represent 0:07:59.076 --> 0:08:01.796 about one in four calories consumed when it comes to 0:08:01.836 --> 0:08:05.236 animal products in North America. So just to be clear, 0:08:05.316 --> 0:08:09.796 twenty five percent of the meat calories and consumed in 0:08:09.876 --> 0:08:14.916 North America is consumed by pets. That's correct. Okay, let's 0:08:14.916 --> 0:08:16.956 go back to Anaheim. So you're taught in the some 0:08:17.196 --> 0:08:19.636 pet food company, yes, And they come to us and 0:08:19.676 --> 0:08:23.316 they start asking us about you know this this cricket protein, 0:08:23.356 --> 0:08:24.916 and you know what are we feeding as as human grade? 0:08:24.916 --> 0:08:27.596 Oh yes it is. Okay, Well, tell us about sustainability, 0:08:27.596 --> 0:08:30.356 and we start describing the sustainability benefits, and their eyes 0:08:30.436 --> 0:08:33.756 just flash and they start describing to us the challenges 0:08:33.796 --> 0:08:35.996 their customers are facing because they're sort of in a 0:08:35.996 --> 0:08:38.516 moral an ethical dilemma that a lot of their customers face, 0:08:38.556 --> 0:08:41.916 who are mostly millennials, the largest pet owning demographic by far, 0:08:42.956 --> 0:08:44.756 face this dilemma where on the one hand, they want 0:08:44.756 --> 0:08:47.396 to feed their pets like their humans, and that's benevolent, 0:08:47.476 --> 0:08:49.836 but then most of what they have to choose from 0:08:49.916 --> 0:08:53.676 to feed their pets is not very environmentally ecologically healthy. 0:08:53.676 --> 0:08:56.436 And that's the other thing. Two dogs are, you know, 0:08:56.516 --> 0:08:59.436 omnivores that preferentially consume meat in their diet, and cats 0:08:59.436 --> 0:09:02.836 are carnivores. So there's also a challenge with just using 0:09:02.916 --> 0:09:06.076 purely plant based or vegetable based. Yeah. Right now, if 0:09:06.116 --> 0:09:08.676 you're like a center left millennial, you want to do 0:09:08.716 --> 0:09:10.356 the right thing for your pet and do there I 0:09:10.436 --> 0:09:13.076 think for the earth? What do you do exactly? And 0:09:13.116 --> 0:09:16.156 so this was the opportunity. Now, the next question this 0:09:16.236 --> 0:09:18.636 customer asked me is well, how what's your volume today? 0:09:18.636 --> 0:09:22.076 We're very interested. This customer is a big pet food company. Yes, 0:09:22.196 --> 0:09:24.796 that's right, and well and they also manufacture and distribute 0:09:24.836 --> 0:09:27.276 to other pet food companies as well. Okay, so they 0:09:27.316 --> 0:09:29.716 ask us, you know, what's your production volume today? We said, well, 0:09:29.716 --> 0:09:32.636 our production volume today is you know, maybe low hundreds 0:09:32.636 --> 0:09:35.476 of thousands of pounds a year. They said, oh, okay, 0:09:35.516 --> 0:09:37.996 well that's that's too bad. We said, well, why why 0:09:38.036 --> 0:09:39.956 is it too bad? They said, you know, the guy 0:09:39.956 --> 0:09:41.716 said to me is like, Muhammad, You're not going to 0:09:41.756 --> 0:09:43.476 be able to move the needle in the pet food 0:09:43.516 --> 0:09:45.756 market unless you get to a million pounds a month 0:09:45.996 --> 0:09:50.196 or more because the demand is very significant and the 0:09:50.276 --> 0:09:53.156 production the way you produce in terms of like the kibble, 0:09:53.196 --> 0:09:56.356 et cetera, has always done at significant scale, and my customers, 0:09:56.516 --> 0:09:58.796 even if they do a test launch in just one market, 0:09:59.116 --> 0:10:02.036 that's like millions of pounds of a required product. So 0:10:02.516 --> 0:10:04.876 of course I immediately said to that person and said, well, listen, 0:10:04.876 --> 0:10:08.156 there's like clearly a value in a philosophical alignment between 0:10:08.396 --> 0:10:12.156 you know, the market you represent and our mission as 0:10:12.156 --> 0:10:14.316 a company. So I mean, if we were to have 0:10:14.396 --> 0:10:17.516 the resources and capacity to scale to meet that volume, 0:10:17.796 --> 0:10:19.916 is that something you would commit to? And they said, 0:10:20.116 --> 0:10:23.436 we would sign today, you know, a commitment if you 0:10:23.476 --> 0:10:25.036 were able to meet that volume and if you were 0:10:25.116 --> 0:10:26.556 to meet that demand. And in fact, that is what 0:10:26.716 --> 0:10:29.836 led to us being able. Now with this significant demand 0:10:29.836 --> 0:10:32.916 in hand, we were able to justify building a commercial 0:10:32.956 --> 0:10:35.516 facility that can lead to us meeting that market. So 0:10:35.916 --> 0:10:39.236 you're gonna sell billions of crickets a year for pet 0:10:39.276 --> 0:10:42.556 food startups in the next year, or so yeah, yeah, 0:10:42.596 --> 0:10:45.196 exactly when are the first crickets going to go out 0:10:45.236 --> 0:10:47.836 the door of your factory headed for a pet food factory? 0:10:49.476 --> 0:10:52.836 In three months? In three months? Okay? Yea, And couldn't 0:10:52.836 --> 0:10:57.316 you say what pet food company is buying crickets? You'll 0:10:57.356 --> 0:11:00.836 find out very soon, Okay. I mean the only pet 0:11:00.836 --> 0:11:03.276 food company I've heard of is Purina, so I'll just say, 0:11:03.396 --> 0:11:10.316 is it Purina? No comment? Interesting? And it's not just 0:11:10.356 --> 0:11:12.596 one It's not just one pet food brand, by the way, 0:11:15.956 --> 0:11:20.356 So okay, plan See this pet food idea seems promising 0:11:20.636 --> 0:11:23.596 for a few reasons. One is, pets eat a lot 0:11:23.596 --> 0:11:26.476 of meat, which I didn't even really think about much 0:11:26.636 --> 0:11:29.276 until I had this conversation with mommy, so there's a 0:11:29.316 --> 0:11:33.236 real environmental problem to solve it. And also, bugs are 0:11:33.276 --> 0:11:36.476 clearly not grows to most of the dogs and cats 0:11:36.556 --> 0:11:38.996 I have known, at least, like if my dog found 0:11:38.996 --> 0:11:43.036 a cricket on the sidewalk, he'd eat it. But now 0:11:43.076 --> 0:11:46.116 that Mohammed has found his cricket demand, he has to 0:11:46.116 --> 0:11:49.556 come up with the cricket supply coming up after the break, 0:11:49.836 --> 0:11:52.476 how do you build the biggest, most high tech cricket 0:11:52.476 --> 0:12:01.956 factory in the history of the world. Now back to 0:12:01.996 --> 0:12:04.996 the show. Earlier this year, Mohammed and his colleagues opened 0:12:05.036 --> 0:12:09.676 a giant cricket factory in London, Ontario, Canada. From the 0:12:09.756 --> 0:12:12.276 outside the factory, it just looks like a big white 0:12:12.316 --> 0:12:15.516 industrial building, and on the inside, to a large extent, 0:12:15.636 --> 0:12:18.676 it also looks like a big industrial building. You know, 0:12:18.756 --> 0:12:22.476 think of like robots moving around palettes with big plastic 0:12:22.516 --> 0:12:26.276 bins on them, But inside each bin is tens of 0:12:26.356 --> 0:12:28.996 thousands of live crickets. Is it allowed when you go 0:12:29.036 --> 0:12:32.916 to where the crickets are is allowed? Not yet? You know, 0:12:32.956 --> 0:12:35.276 we expect that once we get to full production capacity, 0:12:35.316 --> 0:12:40.916 you'll have a nice sort of comforting, soothing chorus of chirping. Actually, 0:12:40.956 --> 0:12:43.356 a group of crickets is called an orchestra, which is 0:12:43.356 --> 0:12:47.036 why we've named our facility here in the orchestra. Okay, 0:12:48.636 --> 0:12:50.476 tell me about the place where you're sitting right now. 0:12:50.516 --> 0:12:53.116 Where are you talking to me from? Our facility is 0:12:53.196 --> 0:12:57.436 one hundred and fifty thousand square foot mostly factory with 0:12:57.556 --> 0:13:01.956 a headquarter office component, and it is the world's largest 0:13:02.556 --> 0:13:08.436 fully automated cricket production facility, largest fully So does that 0:13:08.476 --> 0:13:12.796 mean there's a big not fully automated cricket production facility. No, 0:13:12.956 --> 0:13:16.276 it doesn't. This is just a very comprehensive description. It 0:13:16.356 --> 0:13:18.476 is the largest cricket farm and it also holds the 0:13:18.516 --> 0:13:21.116 record of largest automated cricket farm. It also holds the 0:13:21.156 --> 0:13:24.436 world record farm. So you're talking to me from the 0:13:24.476 --> 0:13:27.676 biggest cricket farm ever in the history of the universe. Well, 0:13:27.676 --> 0:13:30.716 I don't know about the universe, but certainly planet Earth. Good, 0:13:30.956 --> 0:13:36.796 good point. And when did it open? And we began 0:13:36.996 --> 0:13:42.676 production this past month. Cricket number one arrived this month, correct? 0:13:43.436 --> 0:13:45.756 And when are you going to get to cricket whatever 0:13:45.836 --> 0:13:49.156 one billion? Yeah, later this year, towards the end of 0:13:49.196 --> 0:13:52.116 the year. Okay, just because the crickets have to make 0:13:52.116 --> 0:13:54.596 more crickets. Is that what happens? Right? That's right. So 0:13:54.636 --> 0:13:57.196 a single female will lay somewhere between one hundred to 0:13:57.236 --> 0:14:00.716 two hundred eggs per week. So the reproductivity of the 0:14:00.716 --> 0:14:02.916 crickets is pretty remarkable, and the rate at which we 0:14:02.956 --> 0:14:06.316 will grow will be quite exponential. So let's talk about 0:14:06.316 --> 0:14:10.276 this factory like, are there are there sort of tricks 0:14:10.356 --> 0:14:14.116 or efficiencies you're gaining or is it just more crickets? 0:14:14.396 --> 0:14:16.436 You know, you can ten x the amount of crickets, 0:14:16.436 --> 0:14:17.996 and you don't have to ten x the amount of staff. 0:14:18.036 --> 0:14:21.516 And therefore it's just basic simple economy of scale. There's 0:14:21.516 --> 0:14:24.436 a combination of the two. Let's do this. Tell me 0:14:24.556 --> 0:14:28.596 the story at this new fancy, biggest ever cricket factor 0:14:28.716 --> 0:14:31.796 you have, like start with what an eggs? At the 0:14:31.916 --> 0:14:33.676 right place to start? If we start with an egg, 0:14:34.356 --> 0:14:38.196 or maybe with the mother laying an egg, wherever you 0:14:38.196 --> 0:14:40.436 want to start, start at the beginning and end with 0:14:40.476 --> 0:14:44.036 somebody eating cricket. Sure, how does that story go? Yeah? 0:14:44.076 --> 0:14:46.396 So sure. So the way it works is you have 0:14:46.556 --> 0:14:50.556 our breeder totes. So we have these bins in the 0:14:50.596 --> 0:14:54.756 facility that are dedicated to crickets that are sexually mature 0:14:54.836 --> 0:14:58.516 and will mate. And then effectively, the females will deposit 0:14:58.556 --> 0:15:01.676 their eggs into a substrate. That substrate will be incubated 0:15:02.036 --> 0:15:03.836 and then slow down a little I want to slow 0:15:03.876 --> 0:15:05.356 down a little bit. So you have a breeder You 0:15:05.436 --> 0:15:08.876 called it a tote, like, yes, think of it as 0:15:08.876 --> 0:15:11.836 a in the size of a palette. Okay, so like 0:15:12.316 --> 0:15:15.076 a shipping palette. Yeah, like a shipping a box. That's 0:15:15.156 --> 0:15:17.316 that's a pretty large box the size of a palette 0:15:17.476 --> 0:15:19.596 and that's the single unit that we move around in 0:15:19.596 --> 0:15:22.156 the building. Think of that as like the housing unit 0:15:22.356 --> 0:15:25.836 for a certain population of crickets multiplied by you know, 0:15:26.356 --> 0:15:28.876 many thousands of these touts in the facility, and the 0:15:28.916 --> 0:15:31.396 total of that is the total population of crickets. And 0:15:31.716 --> 0:15:34.356 so your crickets live in these boxes. And so you 0:15:34.396 --> 0:15:39.356 have sure some with with crickets that are breeding and 0:15:39.396 --> 0:15:41.916 they lay eggs, and they lay eggs and then those 0:15:41.956 --> 0:15:45.236 eggs are incubated and then they hatch. The newly hatched 0:15:45.236 --> 0:15:47.636 crickets are called pinheads, and that's because they are so 0:15:47.636 --> 0:15:50.596 small they could literally fit on the tip of a pen. Okay, 0:15:50.916 --> 0:15:53.476 how many crickets grow up in in a bidden Yeah, 0:15:53.476 --> 0:15:56.876 approximately thirty thousand are in each bin. Thirty thousand, okay. 0:15:57.756 --> 0:16:01.396 Um And those bins will now have food and water 0:16:01.516 --> 0:16:04.276 and all of the requirements that the crickets are going 0:16:04.316 --> 0:16:06.516 to need for the thirty day period in which they 0:16:06.516 --> 0:16:10.316 are going to be housed in this umility until they 0:16:10.316 --> 0:16:12.076 are ready to be harvested. So, in other words, you're 0:16:12.076 --> 0:16:15.116 putting everything the crickets need that is fully sufficient for 0:16:15.156 --> 0:16:17.716 that thirty d period. You're sealing and closing the lid 0:16:18.276 --> 0:16:22.076 and effectively not touching or interfering with or in any 0:16:22.156 --> 0:16:24.596 way interrupting this process for thirty days. You come at 0:16:24.596 --> 0:16:26.476 the end of thirty days, and in that thirty days 0:16:27.276 --> 0:16:30.076 crickets grow about eight hundred times their body weight. That's 0:16:30.076 --> 0:16:32.316 the equivalent of a human baby growing to become a 0:16:32.396 --> 0:16:36.516 t rex in thirty days. So you have at the 0:16:36.596 --> 0:16:38.756 end of thirty days now these crickets that have reached 0:16:38.796 --> 0:16:42.156 adult size, and you harvest them the way we harvest 0:16:42.196 --> 0:16:45.316 the crickets as we actually freeze them. So okay, that's 0:16:45.356 --> 0:16:48.276 the process of how you raise the crickets. And the 0:16:48.476 --> 0:16:51.276 point of building this big factory and of using the 0:16:51.316 --> 0:16:54.356 plastic toads and everything else is to bring down the 0:16:54.516 --> 0:16:58.756 cost of crickets. Right, So let's talk about cost. What 0:16:58.996 --> 0:17:04.036 is I don't know, what is a pound of crickets cost? Yeah? Sure, So, 0:17:04.556 --> 0:17:08.716 typically speaking, crickets are purchased as either a powder or 0:17:08.796 --> 0:17:12.636 in a raw material form a powder in powder form 0:17:12.716 --> 0:17:14.636 that we would take about let's say four pounds of 0:17:14.676 --> 0:17:18.596 crickets to produce one pound of cricket powder. Right, So 0:17:18.836 --> 0:17:22.236 today a pound of cricket powder will sell for about 0:17:22.356 --> 0:17:25.436 call it somewhere between fifteen to twenty dollars per pound 0:17:25.596 --> 0:17:28.916 of powder. Okay, okay, So if it's four pounds of 0:17:28.916 --> 0:17:31.916 crickets to make that powder, that means even just a 0:17:32.436 --> 0:17:35.316 pound of plane crickets is still more expensive than a 0:17:35.316 --> 0:17:38.996 pound of like chicken, absolutely, and that price is largely 0:17:39.036 --> 0:17:43.556 based on the scale challenge that this industry has had. Now, 0:17:43.596 --> 0:17:46.636 as you scale up and you introduce more automation, your 0:17:46.756 --> 0:17:50.436 cost per unitive production starts to dramatically drop, and the 0:17:50.436 --> 0:17:53.316 more you scale, the more efficient your costs are overtime. 0:17:53.436 --> 0:17:56.596 So for us, the premise always has been that if 0:17:56.596 --> 0:18:00.276 you look at the math like on paper, if crickets 0:18:00.356 --> 0:18:04.836 use less land, less water, less energy, less food, then 0:18:05.276 --> 0:18:08.156 really the inputs that are typically the largest driver of 0:18:08.236 --> 0:18:10.716 cost when it comes to livestock production, if they are 0:18:10.796 --> 0:18:13.556 much lower for crickets, then therefore crickets should be much 0:18:13.636 --> 0:18:16.876 less expensive. It's pretty simple math. The reason they're not 0:18:17.036 --> 0:18:20.116 is because the scale at which you're producing crickets today 0:18:20.156 --> 0:18:22.676 is so small and your labor cost per unit is 0:18:22.716 --> 0:18:25.596 so high that obviously your price is quite significant. This 0:18:25.676 --> 0:18:28.796 is why this facility that we've just built is such 0:18:28.836 --> 0:18:31.276 a massive step, because we are going to be able 0:18:31.316 --> 0:18:34.876 to dramatically increase the affordability of our crickets within the 0:18:34.916 --> 0:18:38.236 next twelve months. And to put that in perspective, you know, 0:18:38.276 --> 0:18:40.596 if a pound of cricket powder today sells for about 0:18:40.636 --> 0:18:44.156 twenty dollars, within the next twelve months, it'll drop below 0:18:44.196 --> 0:18:47.876 ten dollars, and we anticipate that within the next three 0:18:47.916 --> 0:18:50.156 to five years we will actually be close to the 0:18:50.196 --> 0:18:54.316 five dollars per pound mark. You seem confident in those 0:18:54.756 --> 0:18:58.356 in those predictions. So you're saying the price a year 0:18:58.356 --> 0:19:01.956 from now is going to be half what it is today. Yes, 0:19:03.916 --> 0:19:07.236 how do you know? How do I know? The reason 0:19:07.276 --> 0:19:09.676 I know is because you look at what is driving 0:19:09.716 --> 0:19:11.956 the cost today of twenty dollars per pound, because you 0:19:11.996 --> 0:19:18.756 know you're lost yet granularly, So there's two reasons you're 0:19:18.836 --> 0:19:23.236 expecting the price of crickets to fall in half in 0:19:23.276 --> 0:19:25.916 the next year and what in half again a few 0:19:25.996 --> 0:19:29.116 years after that? Basically is that right? If I understand it. 0:19:29.196 --> 0:19:31.996 One is just scale. You just have a really big 0:19:32.036 --> 0:19:36.116 factory now and it's more efficient, fewer dollars of labor 0:19:36.316 --> 0:19:43.436 per cricket. Two, you're just getting better at raising crickets. 0:19:43.436 --> 0:19:45.516 You're getting figuring out how to be more efficient. Is 0:19:45.516 --> 0:19:49.116 that right? Yes, we gather. We will be gathering about 0:19:49.156 --> 0:19:53.396 thirty million data points every single day on everything like temperature, humidity, 0:19:53.476 --> 0:19:56.436 light intensity, sound, pressure, and understanding how each one of 0:19:56.436 --> 0:19:58.436 those things maps to growth. So if I see a 0:19:58.436 --> 0:20:01.476 certain cluster of touts in my orbins in my facility, 0:20:01.836 --> 0:20:04.076 that I see a five percent increase in yield compared 0:20:04.116 --> 0:20:06.396 to a different control, and I look at the underlying 0:20:06.476 --> 0:20:08.676 data and what was actually happening in each bin. A. 0:20:09.316 --> 0:20:10.996 I know what this is happening in each bind because 0:20:10.996 --> 0:20:13.036 I'm capturing that data, and B I can look at 0:20:13.036 --> 0:20:15.916 the nuances of what those differences are and then immediately 0:20:15.956 --> 0:20:18.716 set that new baseline. When we first started, I think 0:20:18.756 --> 0:20:21.076 we were getting so out of thirty thousand crickets, we 0:20:21.076 --> 0:20:24.796 were getting maybe something like two pounds of yield. You 0:20:24.916 --> 0:20:26.956 got a box full of crickets, a box of thirty 0:20:26.956 --> 0:20:30.236 thousand cickets, thirty thousand baby pinhead crickets, and by the 0:20:30.316 --> 0:20:33.716 end of a month you get two pounds. Okay, now 0:20:33.836 --> 0:20:38.956 we're close to twenty pounds per bin and that and 0:20:39.076 --> 0:20:43.556 what was Is it because of more of the crickets 0:20:43.556 --> 0:20:46.556 are surviving? Now? Is it because they're bigger, is it 0:20:46.676 --> 0:20:50.116 something a combination of the above. So figuring out, for example, 0:20:50.116 --> 0:20:52.716 what is the optimal feed where do you ideally place 0:20:52.796 --> 0:20:55.316 the feed because a pinhead cricket is so small, So 0:20:55.356 --> 0:20:57.676 even like the particle size of the feed matters. If 0:20:57.676 --> 0:21:00.236 you have your feed is not crushed into a certain 0:21:00.276 --> 0:21:02.676 particle size, it may be difficult for the crickets to 0:21:02.716 --> 0:21:05.436 eat it. Water water access right when they're When you 0:21:05.436 --> 0:21:07.196 have a cricket the size of the tip of a pen, 0:21:07.356 --> 0:21:09.836 it can literally drown in a drop of water. So 0:21:09.836 --> 0:21:11.916 how do you ensure that it can drink water in 0:21:11.916 --> 0:21:14.676 that very fragile state in its early days and still 0:21:14.716 --> 0:21:17.116 be able to access water when it gets older and larger? 0:21:17.356 --> 0:21:19.556 And how do you optimize the number of crickets? Wait, 0:21:19.876 --> 0:21:22.636 what's the answer to the water one? How do you 0:21:22.756 --> 0:21:26.236 do that? That's a trade secret? Is it really is 0:21:26.396 --> 0:21:29.996 a cricket trade secret? It actually is a cricket trade secret? Yeah, 0:21:31.196 --> 0:21:33.036 So like is the end? Can you tell me what 0:21:33.316 --> 0:21:35.396 what's going on inside the bin? Or it's like that's 0:21:35.396 --> 0:21:38.436 a literal black box, Well it is. It is in 0:21:38.556 --> 0:21:41.076 many ways of black box because that's ultimately when you 0:21:41.116 --> 0:21:43.316 think about all of the intellectual property of the company. 0:21:43.316 --> 0:21:45.516 It kind of comes down to not just what you 0:21:45.556 --> 0:21:47.316 have in the bin and where it's placed, but also 0:21:47.876 --> 0:21:49.996