New Investment Opportunity: Neolithics
Optimizing fresh food distribution
- Automated, AI-powered industrial capacity platform for internal and external inspection of produce
- Customized system optimizes logistics and storage; mitigates high levels of spoilage, financial losses
- $1M contract signed with largest Israeli food retailer; ARR projected 2023
- Negotiations for POCs started with major US and European food retailers
- $2.5M SAFE at 20% discount
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Dear Josb,
Losses and waste in fruits and vegetables are the highest category of losses among all types of foods, with up to 60% of all fruits and vegetables wasted. This waste is one of the biggest costs to food retailers and the methane gas — a greenhouse gas even more potent than carbon dioxide — arising from its disposal creates an enormous environmental issue for which governments are beginning to impose large fines on retailers.
OurCrowd is investing in Neolithics, an early-stage Israeli AgTech startup whose platform utilizes hyperspectral sensors and vision AI that enables food retailers to reduce spoilage and waste of fresh produce and the associated costs. The details in this email are based on information received from, and verified solely by, the company.
The Problem
Current practices in fresh produce processing lead to considerable waste. An estimated 30-50% of fresh fruit and vegetables are lost or wasted globally each year. Insufficient sorting of fresh produce and inefficient utilization is responsible for a large proportion of the waste.
The Solution
Neolithics has developed an industrial quality-control system that can sort fresh produce by detecting a wide variety of quality parameters including physical measurements, aesthetics, ripeness, internal inconsistencies, nutritional values, shelf-life prediction, and chemical detection. Its stand-alone system can scan tens of different types of vegetables and fruit with the capacity to inspect thousands of items and several metric tons of produce per hour. In addition, Neolithics can add custom parameters to meet specific customer requirements. The system seamlessly integrates with existing sorting equipment and machinery and includes a comprehensive online dashboard for real-time quality tracking.
Traction
Shortly after commencing operations, Israel's largest food retailer, Shufersal, contracted to run a pilot project of the Neolithics AI optics system at its central logistics facility. The pilot proved that a distribution center handling 20,000 tons a month could reduce losses due to food waste by over $600K. Based on the success of the pilot, Shufersal signed a purchase order of $1M with Neolithics. The company is also running trials with Granot, one of Israel's largest fruit and vegetable cooperatives, and with Eshet, a pioneering company in sorting and conveying equipment, at two of their packing houses. Neolithics is also in discussions to start pilot projects with major European and American retailers.
The Market
The global market for fresh fruits and vegetables was valued at $691B in 2020 and is projected to grow at a CAGR of 6.79% from 2022 to 2027. Current practices in fresh produce processing lead to considerable waste: between 38-55% of fresh fruit and vegetables are lost or wasted globally each year. The global market for produce quality control is worth $350B, and US e-commerce quality control is worth $22B.
The Team
Amir Adamov, Co-founder and CEO, founded Neolithics to advance practices of food distribution through cutting-edge technologies. Prior to Neolithics, he managed early-stage deep-tech companies developing visual perception and spatial computing, from ideation to sales to Fortune 500 corporations. Guy Morgan, COO and Co-founder, has extensive industry experience in system design, procurement, and integration. He has managed several multimillion-dollar projects for the Israeli government. Michael Litvin, CTO, is a computer vision expert, with a strong background as a team leader, hands-on algorithm developer, and software engineer.
The Round
OurCrowd has an allocation of up to $1.5M in this $2.5M SAFE with a $10M cap and 20% discount. The funds will be used to initiate direct sales in the EU and US, maintain recurring SaaS, continue strategic R&D, increase system capabilities, and further develop IP.
Meet the CEO
We're hosting a webinar/conference call on Thursday, August 25th, at 7PM Israel / 12 Noon New York / 9AM San Francisco for investors to meet CEO Amir Adamov and learn more about Neolithics.
The Neolithics Solution
Neolithics' AI platform combines food science and a deep knowledge of building algorithms for optical applications. Every single fruit/vegetable is turned into multiple hyperspectral data-points, giving information on nutritional content, freshness levels, and how much protein, fat, sugar, or moisture it contains. Different objects reflect light differently, generating unique spectral signatures which represent particular food characteristics.
The system's AI detects, classifies, and sorts every piece of fruit in real time, and provides simultaneous segmentation of background defects and anatomical features in a real-time multi-stream processing on an embedded system. Vast samples have allowed the company to create predictive models to optimize distribution-center practices. The system gives precise inventory valuation upon arrival at the distribution center and provides exact information about the incoming produce. Based on produce scans, the system provides quality prediction and management guidelines for the inventory, enabling best utilization and value to send the right produce to the right destination. Each new system feature can be integrated overnight, compared to industry-best practice of four weeks.
Next steps:
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