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In this episode of the Spilled Salt podcast, we have a fascinating guest with us: Omer Davidi, CEO and co-founder of BeeHero, a company revolutionizing precision pollination.

In discussion with host Maureen Ballatori, Omer shares his journey from the world of cybersecurity to the heart of agriculture, highlighting the pivotal moments that led to the birth of BeeHero. With a background in building and selling companies, Omer’s entrepreneurial spirit shines as he discusses the challenges and triumphs of navigating the startup landscape.

What sets BeeHero apart is its mission to empower farmers with data-driven solutions. Omer delves into how BeeHero’s technology is transforming the way we approach pollination, with a focus on efficiency, sustainability, and environmental impact.

BeeHero’s innovative approach is reshaping the agricultural industry, addressing issues like optimizing hive health to predicting weather patterns. Omer discusses the company’s expansion into new markets, the potential of their vast database of pollination data, and the future of precision agriculture.

From the realm of cybersecurity to the forefront of precision agriculture, Omer’s story is a testament to the power of perseverance and ingenuity. As he looks to the future, BeeHero’s vision for a more sustainable and efficient agricultural ecosystem shines brighter than ever. With groundbreaking technology and a commitment to empowering farmers with data-driven insights, BeeHero is poised to revolutionize the way we approach pollination.

Transcript

This transcript has been edited from its original form to support readability.

Maureen Ballatori: I’m Maureen Ballatori and this is Spilled Salt, a podcast on the thrills and spills from the food, beverage and agriculture industries. 

Today’s guest is Omer Davidi. He’s the CEO and co-founder of BeeHero. They are in the precision pollination business. And what I love about today’s conversation is how we talked about the focus on helping farmers be more efficient and make data-informed decisions, which as we all know, has not been happening in the agriculture industry for very long. 

I love when we can find a company that’s making a big impact like BeeHero is. The company has also created the largest database of bees and pollination information in the world, which is a pretty remarkable thing. Omer touches on that as well as the current fundraising landscape in today’s conversation and some of what’s next for the company.

Enjoy the conversation.

Maureen: Thanks so much for joining me today. I’m really pleased to have you on the show. I always like to start with a little bit of background if you can take a few minutes to talk us through some of your work history.

Omer Davidi: Sure. So as you probably know already, my name is Omer. I’m originally from Israel. I moved to California a little bit more than five years ago as part of BeeHero efforts to build a business here. And my background is in cyber security. 

I started my career in the Israeli Cyber Center, working on some interesting projects. And later on, I was moving into the entrepreneurial world. I founded three companies before BeeHero.

I sold two of them, I closed one of them, so I’ve seen both sides of the coin. And a few years ago, I met one of my co -founders, Itai, who is a second generation commercial beekeeper. And there was a big interest or excitement, I would say, in figuring out whether technology can help dealing with the bee issue, Colony Collapse Disorder, and so on, and part of the things that led us to build BeeHero.

Maureen: Fantastic. And how did you meet your co-founder?

Omer: So there was an interesting program in the Reichman University. It was some sort of a singularity university concept in Israel where you bring people with experience from different domains, putting them in one room and figuring out what will happen. I guess that’s where, in a way, cyber security met commercial beekeeping. 

And we also had Michal and Yuval back then, and the four of us decided to explore this opportunity a little bit further. So yeah, it’s not usually you get to bring people from those domains into one room, but in that case it seems to evolve a little bit.

Maureen: That’s amazing. I love the idea of putting smart people in a room and just kind of seeing what happens. That’s an amazing concept. 

Tell me a little bit more. You mentioned that you started three companies previously. You sold two of them. You closed one of them. Let’s talk about those a little bit.

Omer: I didn’t say smart, I just said with experience.

Yes, so the first company was in the space of energy recycling, basically how do you deal with the waste of different industries, in this case hatcheries and so on, and the impact on underground water. 

There’s always a question of, how can you take something that is considered to be a problem on one hand and make something out of it and, in this case, it’s the ability to actually extract a certain level of proteins from those wastes. And instead of just putting it underground and jeopardizing a lot of the natural habitats and so on, you can actually leverage this into an opportunity. 

Again, it’s some of those weird opportunities, in a way, that comes your way and you decide, okay, it’s interesting enough. There’s a big opportunity there. And by bringing the right people to be involved with a project, you should be able to make a good business. 

During this experience, first of all, it was me establishing my understanding, I would say, in the business world. So making a lot of stupid decisions. But luckily, having the right supportive team and mentors to be able to brainstorm on certain things before making the mistake and making sure we avoid them, or at least avoid some of them. Right?

And that led me to also understand how the entire industry of feature production works in certain industries and leading, I guess, to understanding what technology can take a bigger role in, I would say, labor -intense industries and basically leveraging my capability, my experience to implement technology in areas where you can get a significant efficiency aspects. And that’s what led me eventually into the second company…

Maureen: So before you go to the second company, I want to ask you a couple of questions about this one first. So you mentioned that your background is in cybersecurity and that company that you were just talking about is fish hatcheries and aquaculture. And so you were applying this tech experience to the aquaculture industry and these hatcheries to find efficiencies to help them take what was a waste product and turn it into something that could be used as a valuable resource. Is that correct?

Omer: Correct, yeah, I think the technological skills or experiences were what led me specifically to ask those questions. I must say that I’m more keen, I guess, looking at what I’ve done so far. I’m more keen to see where technology can enhance and support existing industries versus trying to invent the wheel in certain areas that could be extremely interesting. But yeah, I think it’s trying to find the right mix between business opportunity and technological capabilities because otherwise I don’t necessarily bring anything interesting to the table and make a significant impact. So maybe it’s not the sexiest industries and so on, but it affects all of us.

Maureen: That one, what was it called? And is that one of the ones that you sold?

Omer: Yeah. So the, the first one, the, the, the, the first company I was referring to is the ERSI. It’s a company from many years ago. I sold it and this company was dealing with the waste of actual chickens. The second, the second company that you mentioned, the ornamental fish farm and so on. That was basically what I was led into as part of my experience in the, in the first company. But I guess in a way how I got to it is about the waste of the fishing industry and then understanding that actually the production process requires a little bit more technical or technological solution. So that’s why we dived into that aspect.

Maureen: Understood. Got it. Great. So those were, so in summary, the two that you sold were the Aquaculture Company and…

Omer: Yeah, and the energy is basically an energy company, the second one.

Maureen: 

Understood. What about those experiences then led you to, you mentioned that you kind of got in the same room as these other colleagues to kind of come up with the idea for BeeHero and how has that previous experience of scaling and selling companies applied to the work that you’re doing at BeeHero now to continue to scale that?

Omer: I think in general, some of the things that affects our ability to make the right decisions, the fact that we connect emotionally with some of the things that we’ve been doing or the fact that we invested a lot of time in a certain things just make it harder for us to understand that, okay, you know, maybe it’s not what we thought. So I must say that I learned mostly from the company that I actually closed because that’s where you experience, you know, the things that didn’t work well, even to a point that with the experience I got into it, I still made those mistakes. But, I guess it’s about identifying certain assumptions that are the cause for the business, and then keep questioning those assumptions, and not not giving yourself a slack saying, okay, yeah, all the assumptions I made are actually wrong. So today, I wouldn’t make the same assumptions.

I still think I need to pursue it without alternative assumptions that you can bring in. I think that’s probably one of the biggest things. And the second thing is being out there. I can say for me personally as a tech guy, usually I might find myself enjoying staying behind the computer and thinking about cool concepts or cool mathematical models that can solve certain problems. But, in many cases, if you don’t experience the problems in real time, in life, everything is theoretical. And the theoretical world can achieve great things that sometimes cannot really be implemented in the real world. And I think there’s a big gap there as well.

Maureen: So explain for our listeners if you would what BeeHero is the work that you’re doing now with your current company.

Omer: So, BeeHero focuses on precision agriculture, focusing specifically on pollination, precision pollination. We understand that the majority of crops out there, we can call 70-75% of crops out there, depends on insect pollination. And as we build a more concentrated and aggressive food system, we can no longer depend on wild insects to pollinate those flowers. Meaning we need to bring in

Insects and in this case bees will consider to be the most efficient pollinators on earth and As we integrate more managed beehives in the process of food production for pollination We realized that colony collapse disorder the fact that bees are dying in in massive numbers Does not only affect beekeepers or honey production. It also affect food production so our approach in general was to see how can we leverage the fact that

The bees are dying. They are an integral and critical component for food production. And how can we leverage technology to ensure that we support bees and, by that, supporting beekeepers and, by that, supporting farmers with pollination? And that was the reason we founded the company.

Maureen: I love it. One of the things when, so I met your colleague at World Agritech in California a month ago. And when I learned more about the company, what I loved about it is what you explained. You said I’m more of a behind the scenes guy and I think it’s really important for there to be a real world application. And so we’ve worked with other bee related industry companies before at Agency 29.

And what I loved about BeeHero is that it works in any beehive, right? So the clip that you have, the device that goes inside the hive can go in any standard frame and you don’t have to have any special equipment in order to make it work with the existing hives. And then you just add the technology to that to make it a smart hive. Am I summarizing that in the right way?

Omer: Yes, I think that’s an important note because in many cases we look at something and we say, okay, you know, if we do it from scratch, we can probably do it better. By the way, it’s not necessarily the case, but that’s sometimes our thinking process. But then you also need to realize the existing industry of millions, if not tens of millions, or if you look globally, hundreds of millions and 100 million eyes that are operating in a certain way. And

Most of the commercial big keepers fixated on a certain setup, not because they wanted this setup but because they tried it for maybe hundreds of years and they got to realize that the cost efficiency of this setup makes sense for them to build a business and those that exist today survive. So they’re probably doing something right. And if you’re thinking that, you know, by just developing the greatest technology, you can change entirely how people do things in a split of a second.

Then you’ll invest a lot of money, a lot of time, a lot of effort, and you’ll find yourself stuck, not being able to scale very fast, and then questioning. I mean, we see today with autonomous vehicles, right? If you build a vehicle today that doesn’t have a driver’s seat or even the ability to drive it, you will probably need to wait 10, 15 more years before you can put it on the road. But if you’re building this hybrid model where, yes, it can help you in certain areas, but you’re still in charge, then suddenly the adoption looks better. And again, autonomous vehicles are probably a lot behind where people expect it to be. I think for us, we took it even one step backwards saying, okay, it needs to integrate seamlessly in how you operate beekeeping today, because otherwise the adoption, our ability to learn and improve and to offer maybe better solutions down the road will not exist.

Maureen: I think that’s a big part of the brilliance of likely why BeeHero has gained so much traction in the industry is that, right? Instead of trying to reinvent the wheel and recreate the beehive, you took the existing beehive and found out how to make it more advanced to get the end result that you were looking for. And so that end result is optimized efficiency in the pollination events, right? Because of the information that comes out of the hives and the ability for the beekeepers to understand the efficiency of the hives.

Omer: Correct and I think you touched the point, it’s optimizing. It’s not necessarily taking it to the optimum at this stage. Maybe with the existing solution we will not be able to provide the optimum, but if you look at it from a cost effective perspective, integrating the sensors, supporting beekeepers to introduce stronger and healthier hives, ensuring that you get the coverage of bees, actual bees, not just boxes that you need in an acre.

ensuring that you have enough bees to visit those flowers depends on the, you know, the time frame that you have for pollination. These are the critical components and there’s no way back. If you end up not visiting those flowers in a few days time, those flowers will dry and fall and that’s it. You don’t get any output. And because of the volatility of hive strength and the fact that prices of pollination went up, because it’s tougher to grow bees and you need more bees as you scale your business, we got to a point that in some cases you have farmers paying a lot of money. It could get to hundreds of dollars per acre and not very confident on what they have out there. They do have the boxes, but what’s inside those boxes? And that’s where you need to find a solution that by the way, does not favor a certain player. We want to support the beekeepers to introduce stronger hives to support the pollination process. It’s not just opening the hive or bringing transparency without introducing additional value.

Otherwise it’s a zero -sum game. Otherwise as you help someone to win, someone else loses and that’s not sustainable.

Maureen: What else could this technology work on? I mean, it’s obviously very focused on bees, and you mentioned almonds and other pollination events. What else could this technology be applied to?

Omer: So we are actually now moving forward with two main channels as I look at the development of the technology, you know, starting from inside the hive. So the first one goes into in-field sensing. We understand that one challenge is to introduce strong and healthy colonies into the field. 

The second one is to know where the bees are going and whether you can adopt different practices to affect pollination. You know, we see sometimes even the use of spray, which, if you need to be able to produce food without continuing to convert natural habitats to farmland, you need to be able to use those products. 

But there’s also a question of how to use those products. And as we start to sense also what’s happening outside of the hive, in the field itself, getting a better heat map of the bee coverage in certain areas, we can support farmers in making those more informed decisions and actually ensuring the coverage of pollinators, not just the number of bee frames being deployed in the field and I think it starts to develop in a very interesting ways. 

You know, we have some greenhouses and other net houses and so on where sometimes you integrate different types of pollinators and you want to know what kind of contribution each one of those pollinators provides and that started to develop in very interesting areas. 

Again, it’s still the early days of those streams so we are still, it’s kind of a discovery mode, I would say, but I think it’s extremely interesting. And we tie it also with what we see inside the hive. 

And it’s quite fascinating to see. So that’s one angle. The second angle is to try and leverage the fact that BeeHero is deployed in hundreds of thousands of hives today, mostly across the US and Australia. But we do have some activity in other places. And we are covering a significant portion of pollination activity in certain commodities. 

This helps for different stakeholders to make more informed decisions. We’ve seen how we can compare pollination activity in certain areas year over year and then you realize how it actually affected the outputs of those commodities and there’s something interesting there that we are still trying to assess and work with our partners in order to figure out but this data didn’t exist before. People were able to identify certain aspects of it.

But most of the commodity trading efforts or trying to analyze production for industries is based mostly on weather, weather conditions, maybe soil. Nothing relates to pollination. And the biggest question, by the way, and it’s still a question mark, is how much the additional layer of information of measuring pollination specifically contributes to the results and that is yet to be seen, I guess.

Maureen: I love that you understand the, well, of course you do because you’re obviously, this isn’t your first foray into technology and this industry, but farming and their ability for producers to make data informed decisions. 

We are really just scratching the surface on that. And it’s amazing how far farmers have been able to come out of necessity, right? With just, you know, a notepad and paper and their ability to kind of know what to expect from their fields year over year and seeing how that changes. 

But when we introduce technology and that analysis at a year over year level to see, we tried this, what kind of impact did it have in the bigger picture to make more informed decisions for future years to again continue to increase efficiency is such an asset to the industry.

Omer: I totally agree. And I think the interesting part here is that it’s not a typical startup environment, right? Usually you want to see quick cycles where you can close the loop. Okay. You implemented this new feature and suddenly you can see the results in one or two months. 

We always hear about the slow adoption of certain industries. The agricultural industry is a good example, but I think if you don’t realize that first of all, the level of decisions that pharma needs to make.

Right. They’ve seen something for the last 20 years. They have a feel for it. Now this field is based on data. It’s just, they aggregated into, let’s call it intuition. If they decide something that is the wrong decision, it could be the go/no-go. Like this decision might have a significant implication on the business. And I think it goes back to what we discussed before. If you’re trying to implement something very different.

It’s a big change from how things are happening now. You should expect slow adoption and you should be ready to finance it for a longer period of time because maybe you have a great solution but it’s not in a place where it can be integrated into the existing farm. 

The decision is trying to find the right balance, especially in the startup ecosystem where sometimes investors want to see quick ROI on their investment but also realize how much time is going to take. I think in these kind of industries, it’s all about finding the, maybe not the perfect balance, but a good enough balance that allows you to get the adoption, get the feedback, the constant feedback from your customers and partners in the process to improve while starting to build the strong presence in the market and knowing that you need to jeopardize some of the things you might be able to fix later on just because now it’s too much.

Maureen: You’re dealing in seasons as opposed to, you know, making small, you can make some small changes, but in some cases, you’ve just got to wait for the next season to come along. You mentioned investment, and there’s been a lot of discussion lately about how brutal the current fundraising landscape is. What are your thoughts on that?

Omer: I think fundraising in general is brutal, right? We always see the news about this company close and also with BeeHero and sometimes, especially early stage entrepreneurs, things that, wow, it’s so easy to raise money. It’s tough. 

You need to go to certain people and explain to them why you’re going to, why are you dealing with an interesting enough opportunity and why your solution is going to be the one to win. And if you are the only one there, then there’s probably a problem in the market, right? Because otherwise maybe it’s not an interesting enough company, so industry. 

So assuming you have competitors, you need to explain why you and so on. And it’s tough. I can tell you that in the seed stage, it was extremely tough for BeeHero. We had a few months where we didn’t pull a salary to make sure we can pay our employees and it’s a very tough environment to be in. I think that’s part of why we do what we do, right?

And of course, as the company matures, everything is a bit different. I think what we’ve seen since, I guess, the latest stage of 2022, where the market basically realized that, hey, valuations are crazy. 

People raise hundreds of millions of dollars in valuation that they will not be able to support in the next 10 years. And the public market and all the spark play basically exploded to a point that people started to ask, okay, what are the metrics that we want to look at? And that really depends on what stage your company is. 

If you just started and you haven’t raised money, I don’t think it should affect you that much because you can start fresh. You can set a realistic valuation. You can expand your business in a thoughtful way and you should be fine. And then if you have a certain metrics talking about, you know, path to profitability, year over year growth, top line revenues, gross margins, all those things, you can start and tie some understanding of what’s the real value of this company and how well you expect it to grow with time. 

And now it’s a question, did you raise your last funding round on a crazy valuation? Meaning you’re going to need to give a significant discount and the investors will take a hit. 

And most importantly, the employees will take a hit because the investors will see the money first or you manage to maintain a realistic valuation that you can keep supporting as you move forward. 

And I think that sometimes what, you know, early stage, sorry, first time entrepreneurs, I would say, are trying to optimize valuation on paper. And I think the more experienced people always want to try and maintain an evaluation that can be supported outside. 

So maybe on paper you didn’t maximize on it, but you always have the opportunity to show return on investments to your investors. And that’s the important cycle. 

I think we are out of the bloodbath, I would say, that we’ve seen. We’ve seen companies raising, you know, at the end of 2023 on an 80% discount. That’s crazy. Some companies, of course, closed and so on, but 80% discounts, liquidation preference, things that again will affect the company in the longer term.

I think now we’re in a position that investors want to invest this money in the market. They’re looking for the right opportunities. They’re looking for realistic valuation. And if you have those things with you, it’s never a walk in the park, as I mentioned at the beginning, but the money is there. The money is there.

Maureen: Especially if you’re doing something truly innovative and you’ve got the data and the story to back it up. Great advice. So BeeHero, because of your work in this industry over the last seven years, you have amassed an enormous database of bees and pollination data. And is it the largest database of that information in the world?

What can you do with that information? What kind of value can that have for the industry?

Omer: By far. So you know that that’s the biggest question because when you establish the concept and you start to collect the data and you build a model… There’s always the question, okay, do I want to upload only the data that I really need in order to be able to predict certain things or am I going to pay the 10x to just store everything and figure out later what we can do with it. And especially to make this decision when you are an early stage company you don’t have a lot of resources otherwise you know it would have been easy.

But we basically decided to upload everything. And now as we have a little bit more capacity and our data science team is a little bit more robust and strong in different areas and can focus on various things, we started to look at different trends. 

And, you know, it moves from some things that we’re not sure whether you can actually commercialize or it’s interesting, you know, visibility to forecast weather. Like we practically see that bees’ behavior changes a lot before the weather changes.

And you can actually establish models that help you to leverage this kind of information. So I think that’s one interesting area. We took it more into the commodity play and tried to see how we can support our existing customers, the farmers and so on by providing them industry forecast, industry understanding.

Now we are not in a position that we are monetizing the data or selling the data and so on. But in this exploration mode, for example, we managed to identify pricing trends for certain commodities, commodities that we are heavily deployed in, where we can say, okay, this is how we forecast the industry to react. 

Based on other data sets that we pool, like the USDA, weather conditions and so on, we can actually forecast or give you, let’s say a recommendation on how much to sell your goods for, because this is what we expect to see. 

Now, there’s probably another year or two until we get to a point that we’re confident enough to bring it to the market, because again, as I mentioned, it’s tough decisions, big decisions for stakeholders to make, and you don’t want to bring something that is a little bit premature because the risk is big. 

But we do have the confidence today that it exists. We have built several case studies. And as I mentioned, I guess in the next year or two, we will see a little bit more of this data flow support of stakeholders and customers and partners to make more informed decisions because there’s a lot of money on the table left behind because of those missing pieces of the puzzle.

Maureen: I love your approach to that concept though. We know that this data is valuable. It makes sense to retain while we sort of wait and see where it has the most value to the industry. I think that’s an admirable approach. Last question for you. Tell us about what’s next for BeeHero.

Omer: Yes, it’s pretty exciting. I mean, you mentioned seasonality, which is one aspect. 

We expanded last year to Australia and our experience was a lot better than what we expected. I think the need for adoption and improvement and precision in agriculture is all around the world. It’s not just the US. 

So as we focus on expanding BeeHero, we have one aspect of the geographic expansion, introducing the value of BeeHero to other parts of the world helps us to learn twice as fast, right? 

Because we experience two cycles a year suddenly as we are spread across different geographies. So that’s one aspect. 

The pollination insights platform, the in-field sensing that I mentioned, started to develop interesting ways from monitoring pollination activity in coffee and helping big players make informed decisions on their commodity play in the coffee market and so on. 

So, these are evolving in interesting ways. So we are putting a lot more focus into those aspects. And as you mentioned, we still have probably another year to invest in this data play and to figure out, by the way, we might find ourselves a year from now saying, you know, it’s not strong enough.

If we thought that’s the case, we wouldn’t invest a minute in it, but it definitely could be the scenario. And I think, you know, for us, we want to keep expanding with our beekeeping partners and provide the valuable position of BeeHero to others and just squeeze everything we can from the additional layer of information that we created. And it’s very exciting. It’s very exciting.

Maureen: It is very exciting. Thank you for joining me today and telling the story of BeeHero and how you got to where you are today. And look forward to watching what’s next for you and for the company.

Omer: Thank you so much for having me. Thank you.