Startup journeys are rarely linear. It often takes many iterations to get something from a mere idea to a market-ready product. And sometimes, a business idea can change entirely during the discovery process. For Olympia Yarger, it led from wanting to launch a sustainable poultry farming business to developing modular maggot robots for food waste management through her Canberra-based startup Goterra.
“When I started, I was just looking for a sustainable protein feed for a poultry enterprise. And that’s how I found insects. Initially, I switched my focus to farming those instead of poultry to avoid the trap of doing too many things at once,” says Olympia. “But then I realised that the supply chains around feeding animals (or humans for that matter) are broken in their current state.”
Australia’s agricultural sector depends on carrying heavy road and rail freight over vast distances to feed farm animals. This adds to the sector’s overall environmental footprint and is also a major money drain. Feed makes up 70% of production costs for farmers and the cost of feed is relative to its transportation requirements. And Olympia didn’t want to replicate the model for her insect farming business by carrying food waste across the country to feed insects that would then, in turn, feed other farming animals in the supply chain.
Taking the leap: from insect farming to food waste management robots
“If we had used the same intensive farming model to farm insects as in the intensive farming of any protein, we would have also replicated the same problems. That’s why we switched gears to fix the logistical challenges around feeding protein and combine it with proximity to the waste streams for the insects,” says Olympia. “And once we figured that out, it was like ‘hold on a second: this is a food waste management business, not a protein business’.”
Goterra now deploys maggot-filled modular robots within the existing waste management system to process food and effluent waste, which would ordinarily end up in landfill. Food waste in landfill currently costs the Australian economy around $20 billion per year. It also accounts for more than 5 per cent of Australian greenhouse gas emissions.
Instead of disrupting the existing waste management process though, Goterra is looking to integrate its solution within the system. This means taking advantage of the waste management processes that are working efficiently. Large waste producers such as hotels, hospitals and schools can host the units on site. For smaller volume clients, the process is comparable to regular landfill collection. Waste distributors pick up the food waste and then bring it directly to Goterra or modular units at landfill sites.
“I think what’s interesting is that there’s a real market pull for our solution,” says Olympia. “We work a lot with SUEZ who are looking for ways to take food waste from landfill. But the existing options are limited and often very specific in terms of the volume they are willing and able to take. Or the facilities are too far away to be viable.”
Goterra’s agile, modular solution overcomes that challenge at half the cost of food waste going into landfill. What’s more, after 12 days of maggot robot processing, the team ends up with two other sellable products:
- the manure of the insects (frass) that is going into composters or becomes a natural fertiliser;
- and the insects themselves that are in high demand as a protein stock feed.
Hiring the right team to walk bravely into the unknown
Until then, though, Olympia had to manage the balancing act of insect farming, innovating and fundraising with a lean team. “Once the funding came through, I was able to hire. But before that, it was just two interns and me,” says the entrepreneur, who at the time spent 10 hours per day on farming-related activity alone. “Maintaining resilience for extended periods is hard in this situation. You constantly need to reaffirm that you’re OK. That you’re going to make it, even if you just stuffed something up. And that is difficult.”
Yet, while the funding enabled Olympia to grow the team, she was cautious not to rush the process. Before bringing on an executive team or other staff, she wanted to know exactly what kind of people she needed to hire to stay on the right path. And that required both an understanding of the skills and personality traits she sought.
“I suddenly had to move operations from a two hundred and eighty square metres facility to twelve thousand square metres. And most of the information needed to do that was in my head. So, having the right people on board was fundamental to me,” says Olympia. “ I needed to be able to walk up to them and say: ‘We’ve got four hundred and eighty Standard Operating Procedures (SOPs). None are going to apply to the new facility. Could you write a plan for how we will evacuate the new space?’ And even though they may not have done that before, they’d just go and figure it out.”
To help to get the right people on board, Olympia’s first hire after the fundraising was a Head of People. For the first month, she did nothing but define and write down Goterra’s company culture. “It felt a bit weird to receive all this money and not to launch straight into action, but it was the right step,” says Olympia. “The people were always going to be what made or broke us. Nothing was more obvious to me than the effort required by my staff to move through the unknown happily and well while also having some level of fulfilment.”
The requirement to walk bravely into the unknown exists in any start-up. But even more so in a business creating an entirely new category: such as maggot-fueled food waste management robots.
It also requires a team with a unique skill set.
“For a long time, we thought we would likely need these different kinds of engineers. But the longer we worked on the business, we realised that we need tradespeople,” says Olympia. “And then you say to the new CTO: ‘here is an electrician and a fitter’. And they have never worked with people in these types of roles before. But again: If you’ve hired the right people who are curious, who are learners, that kind of request is exciting and interesting, not scary and overwhelming.”
What to do when the pattern is off: fundraising for a hardware start-up
With a solution and business model in high demand, Olympia did not have any issues finding investors willing to back Goterra. However, raising the money was still a learning process.
“What makes a hardware start-up difficult compared to a SaaS platform, is that investors are looking for a success pattern. The first question when you turn up with a maggot robot for food waste management is: ‘How many users is that?’ And that’s the first time your answer doesn’t fit the pattern. Then the next question is: “how much capital do you need?’ And the answer is lots. And then the pattern is off. You just don’t fit in any of the stories.”
That’s why Olympia worked on talking about her business in a way that would resonate with investors. This meant disregarding most commonly accepted startup advice.
“The majority of startup media give you these mostly made up templates where you provide investors with ten Kawasaki slides. Then you follow up three days later with this particular email template to get the meeting,” says Olympia. “But I haven’t had that kind of experience even once. Sometimes you don’t pitch a deck at all. Sometimes you just talk in the middle of a conference with an investor who is interested enough to have a chat. And then they send you one hundred and fifty-two questions, and you send them the answers. And four months later, they’ll send you another hundred and fifty-two questions.”
Olympia’s problem with the templated route is that founders can get lost in the process. They focus their attention on fitting the template rather than getting good at talking about their business. “That’s how you end up spending too much time trying to shove your unit economics into the same template as AirBnB. And it won’t ever work. You are never going to be able to tell that story because you’re not AirBnB.”
Instead, Olympia used the fundraising process for Goterra to get good at explaining the ins and outs of the business. This meant asking for a lot of feedback from investors – especially the ones that didn’t end up backing the company. Was there something she could do better? Was there something in her pitch that she didn’t explain well enough?
“There were even a couple of people who said something really kind of rude like: ‘oh, this doesn’t even make sense’,” she remembers. “And I would stop my pitch and ask which part? Because if I can’t explain my own business to you then that’s a big problem and I don’t want to even go any further.”
And she recommends that other founders seek this external perspective more frequently.
“I think what is more comforting [than any template], is to know your business well enough to stand in front of people who don’t get it and share this journey. And if you can do that, then you can do anything. You then just need to find the right people to stand in front of.”
Follow Goterra’s journey
The Goterra team is currently building their capability to accelerate and scale the business first here in Australia. The company has a long-term view to expanding internationally. You can follow their work and journey on LinkedIn and Instagram.