In the age of artificial intelligence and biotechnology, the key to saving the agriculture industry billions of dollars could be a pouch the size of a sugar packet.
That's according to Aidan Mouat, co-founder of Hazel Technologies, which makes a small sachet that prevents fresh produce from spoiling. Spoiled food contributes to the 130 billion pounds of food Americans throw out per year, amounting to more than $160 billion and 31 percent of the country's food supply, according to the U.S. Department of Agriculture.
Founded in 2015, Hazel's product presents a simple solution to the problem of food waste. The company's sachets are placed in boxes of produce before they ship and slowly release vapors specifically created to slow down the spoiling process, increasing shelf life by up to three times. The Chicago-based company has more than 160 clients in a dozen countries, including major U.S. growers such as Mission Produce, Agritrade Farms, and WP Produce. Mouat estimates that the company prevented 270 million pounds of food waste in 2020, a figure he expects to double this year.
"Chemistry plays a central role in agriculture," says Mouat. "I said, 'Here's something where I can actually make a difference.' " Mouat declined to share Hazel's revenue.
Hazel's traction has investors paying attention. The company announced a $70 million Series C round in April led by venture capital firm Pontifax AgTech and Singapore-based investment company Temasek, bringing the company's total raised to $87 million. The investment capital will help the company attack two of its greatest challenges--expanding internationally and marketing to retailers and consumers.
Mouat helped engineer Hazel's pouches after focusing on the global problem of food waste. While earning his PhD in chemistry from Northwestern University's Institute for Sustainability and Energy, he teamed up with a handful of other students to create a small paper pouch packed with natural materials like sand, dirt, wood, and ash, which slow decay. The pouches also include active ingredients specific to each crop--like antifungal vapors or compounds that inhibit the rot-causing gas ethylene--which create a timed release so that the produce is continually treated as it ships.
"By simply controlling the storage atmosphere, we're able to control the metabolism of the produce without introducing any new chemistries whatsoever into the consumer," says Mouat. "There are no new chemicals going into the food supply and nothing that leaves any residue. It's completely atmospheric chemistry."
Specialty Crop Company, a California-based grower that sells figs, kiwis, and persimmons to U.S. supermarkets like Costco, Trader Joe's, and Safeway, has experimented with spoilage-preventing products from sprays to ethylene absorbers, with mixed results. When Hazel reached out last year, the company was eager for a better solution.
"Any way I can help extend that shelf life, even if it's by a day or two, I'm all for it," says sales manager Erik Herman, whose parents founded the company in 1989. Herman says he's seen a noticeable drop in the number of shipments rejected by buyers since the company started using Hazel, which has allowed it to maintain good relationships with its clients and helped its bottom line.
Mission Produce, the U.S.'s biggest grower of avocados, began using Hazel's sachets in 2018. The company places a single pouch into a 25-pound box of avocados when the fruit ships on week-long journeys to the U.S. from Central and South America, which has helped extend the avocados' three- to four-day shelf life by two or three days. As a result, retailers have been throwing out 55 percent fewer avocados, according to the company. Mouat credits much of the company's success to the fact that the product doesn't require farmers to introduce any new processes.
Other startups are focused on the world's massive food spoilage problem. San Francisco tech firm Afresh, whose co-founder Matt Schwartz was named an Inc. 30 Under 30 honoree in 2019, makes an app that applies artificial intelligence to weather reports and purchasing data to advise retailers how much produce to buy and when. Goleta, California-based Apeel makes a plant-based coating that keeps produce fresh longer. Many other companies make waxes and sprays for the same purpose.
Hazel makes a variety of products for different types of produce, from apples to cherries to cantaloupes. Last year, the nonprofit International Executive Services Corps began putting Hazel's sachets into avocado exports from the Dominican Republic in an effort to boost farming in the country. Hazel has begun testing out new formulations for the organization that can be used with exotic Dominican crops like snake gourds and Indian bitter melons.
"That's the nice thing about Hazel--they really want to experiment and work with people to try things out," says IESC chief of party Brian Rudert. "They're a fairly unique company in that regard."
The 55-employee company is developing products that can slow sprouting in root vegetables like potatoes. It's also working on solutions for proteins such as beef and fish.
The effects go a long way for the planet, too. Food waste is responsible for about 8 percent of all greenhouse gas emissions worldwide. And food rotting in landfills produces methane, a greenhouse gas that's more than 25 times as potent as carbon dioxide at trapping heat. Mouat estimates that Hazel has prevented nearly 100,000 metric tons of carbon dioxide equivalent from entering the atmosphere.
"We're not talking about incremental change," says Mouat. "We're talking about having created a new pathway for the world that allows us to prevent carbon from going out into the world while directly impacting the bottom line for these companies."