Mitti Labs, a startup focused on reducing methane emissions in rice farming, has successfully raised $3 million in a seed round led by Lightspeed Venture Partners, Voyager Ventures, Overview, and several angel investors. This funding will enable the company to expand its groundbreaking projects aimed at transforming rice cultivation in India and beyond, addressing both environmental and economic challenges.
Mitti Labs, co-founded by Harvard Business School graduates Xavier Laguarta and Devdut Dalal, along with CTO Nathan Torbick, has introduced innovative agricultural techniques designed to reduce methane emissions and water usage. The startup launched in May last year and has already initiated five projects across 30,000 hectares in India, with ten more in the pipeline. These projects are part of Mitti Labs' broader strategy to make rice farming more sustainable and profitable for farmers.
Rice is the staple crop for more than half of the world's population, with demand continuously rising, especially in South and Southeast Asia. Traditional rice farming methods are highly water-intensive, requiring approximately 3,000 liters of water per kilogram of rice. Moreover, rice paddies generate significant methane emissions due to anaerobic conditions that favor methane-producing bacteria. Methane is a potent greenhouse gas, nearly 30 times more effective at trapping heat in the atmosphere than carbon dioxide, although it dissipates faster. Rice farming is responsible for about 10% of global agricultural methane emissions, contributing to climate change and environmental degradation.
A New Approach to Rice Farming
Mitti Labs aims to tackle these challenges using a combination of advanced technologies and sustainable farming practices. The startup collaborates with organizations like the Syngenta Foundation, Ebro Foods (the parent company of Tilda rice), and Dr. Reddy's Foundation to train over 40,000 smallholder farmers in India. The primary techniques promoted include:
Direct Seeded Rice (DSR): This method involves planting seeds directly into fields without the need for continuous flooding, thereby reducing water usage and labor costs. However, it requires careful management to control weeds and ensure proper seed placement.
Alternate Wetting and Drying (AWD): AWD involves periodically allowing rice fields to dry out rather than keeping them continuously flooded. This technique can reduce water usage by up to 30% and methane emissions by up to 60% compared to traditional methods. It requires training farmers to monitor water levels using simple perforated pipes and timing irrigation correctly.
No-Burn Strategies: The no-burn strategy involves collecting and processing rice biomass instead of burning it. While this approach requires a viable business model, it can significantly reduce methane emissions.
To ensure the effectiveness of these methods, Mitti Labs employs cutting-edge Digital Measurement, Reporting, and Verification (dMRV) technology. This system uses high-resolution satellite imagery and on-ground gas chambers to monitor and measure the environmental impact of their projects. By combining data from synthetic aperture radars (SARs) and other satellite sources, Mitti Labs can track water levels, soil moisture, and plant growth with high precision.
The data collected from these technologies is processed through AI models and third-party labs to calculate emissions. This rigorous verification process is crucial for generating high-quality carbon credits that can be trusted by buyers in the voluntary carbon market. Mitti Labs works with renowned institutions such as Cornell University, the International Rice Research Institute, and the USDA to advance their measurement practices and ensure the reliability of their carbon credits.
Benefits and Challenges
One of the key aspects of Mitti Labs' approach is to make these sustainable practices economically viable for farmers. By reducing input costs and generating additional revenue through the sale of carbon credits, Mitti Labs aims to increase the annual incomes of participating farmers by up to 30%. The startup ensures that at least 70% of the profits from carbon projects are distributed among the farmers, with the remaining amount shared among Mitti Labs' partners and the startup itself.
Convincing smallholder farmers to adopt new techniques can be challenging, as they often hesitate to move away from traditional practices. Mitti Labs addresses this by providing continuous support and advice through its on-ground implementation partners. The startup's 120-person operations team works closely with local communities, refining their approach to align with the specific needs of each village.
"Our team works with implementation partners, continuously refining the pitch to farmers; what works in one village, might not work in another. So the behavior change element has to be very targeted, and completely aligned with the local communities’ needs," Devdut Dalal
What's Next
With ten additional projects in development, Mitti Labs plans to expand its reach to cover 200,000 hectares and mitigate 360,000 tonnes of CO2 equivalent annually by the end of 2025. This ambitious expansion will be supported by another funding round early in 2025. The startup also aims to enter new markets, including Bangladesh, Thailand, and Vietnam, by the end of 2024 or early 2025, leveraging partnerships with local organizations and investors.
Investors are optimistic about Mitti Labs' potential to scale its model across India and beyond. Hemant Mohapatra, Partner at Lightspeed Venture Partners, highlighted the transformative potential of Mitti Labs' work, noting the significant environmental and economic impacts it could achieve. "We believe Mitti Labs’ innovative, tech-driven approach is set to be a game-changer in the fight against methane emissions, and we are excited about the potential for scaling its model across India and beyond," said Mohapatra.
Addressing a Global Issue
Rice farming is a significant contributor to global methane emissions, accounting for approximately 10% of agricultural methane releases. This is primarily due to the anaerobic conditions in flooded rice paddies that promote the growth of methane-producing bacteria. Additionally, the industry is responsible for substantial water consumption, using nearly 30% of the world's freshwater for irrigation, and contributing to other environmental issues like soil degradation and biodiversity loss.
Mitti Labs' efforts aim not only to mitigate these environmental impacts but also to improve the financial stability of smallholder farmers. By integrating sustainable practices, the company helps farmers increase their incomes through the sale of carbon credits and reduced input costs. This holistic approach ensures that environmental benefits are paired with economic incentives, fostering a more sustainable and resilient agricultural sector.
Laguarta and Dalal conceptualized Mitti Labs last year after meeting during their master's in business administration at Harvard Business School. Before beginning the startup, Laguarta had experience in sustainability consulting, while Dalal worked in the food and agricultural supply chain. CTO Nathan Torbick, who joined as the third co-founder, brought expertise in remote sensing and environmental monitoring.
“When you look at the agriculture space, there’s been so much done, and regenerative agriculture is something that people talk about all over the world. But when you look at the amount of people who are trying to tackle rice specifically, it is so much smaller than most other crops,” Xavier Laguarta.
Mitti Labs' focus on rice farming stems from its significant environmental impact and the relatively limited attention it has received compared to other crops. By concentrating its efforts on this critical area, Mitti Labs aims to become the leading player in sustainable rice farming, setting new standards for the industry and inspiring other startups to follow suit.
In conclusion, Mitti Labs' $3 million seed round marks a significant milestone in its mission to reduce methane emissions and water usage in rice farming. Through strategic collaborations, innovative technologies, and comprehensive training programs, Mitti Labs is setting new standards in methane emission reduction and water conservation in agriculture. As they continue to scale their operations, Mitti Labs is poised to make a substantial impact on both the environment and the livelihoods of farmers in India and potentially beyond. The company's success could pave the way for broader adoption of sustainable practices in rice farming globally, contributing to the fight against climate change and the promotion of agricultural sustainability.
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