When people think about the water they use, they tend to think of drinking water from the tap or perhaps taking a daily shower. But about 70% of the water we use goes to growing the crops that feed us, This number swells to 90%. In low-income countries. Finding water for other uses can be difficult.
However, in many areas, farmers are incentivized to use the amount of water they believe they need, even if it is excess, to ensure crop success. “Governments want to produce their own food. They don’t want water to be expensive,” said Jairo Trad, co-founder and CEO. KilimoTechCrunch said.
He added, “But if farmers reduce irrigation, there is a great risk of losing production, losing money, and losing more food.” “There is a risk imbalance.”
Cheap irrigation has turned many areas around the world into breadbaskets, but it also means that there is little left for other uses.
For businesses, water shortages can pose an existential threat. “If you have a $1 million, $200 million bottling plant and you don’t have water next week, there’s a lot of money at risk,” Trad said. “So we started talking to people and trying to put a value on the water.”
What Trad and his colleagues at Kilimu have created can be considered a risk management tool. So far, the company has taken about 100,000 soil samples across 45 different crop types in a number of different countries, mostly in South America. From there, he uses those samples to correlate soil moisture with satellite images of agricultural fields, which is much easier to obtain.
“You have to sit close to the ground to understand how things behave in that specific soil in that specific country,” Trad said.
Kilimo can then monitor agricultural fields remotely and advise farmers on their water use. It charges farmers a fee for the service, and if they can successfully reduce their water use, Kilimo can sell the excess water to a company that needs it in the same watershed, sharing a portion of the proceeds with the farmer. In the end, farmers who reduce their water use end up netting 20% to 40% more than they paid Kilimo. Everything is verified by third parties according to volumetric accounting standards for water utilities.
Although the startup has been around for about a decade, it is expanding its operations as water scarcity rises to the top of the list of executives’ concerns. It currently operates throughout South America, including Argentina, where it is based, and Mexico. Next is the southwestern United States and Europe. To support growth, Kilimo recently raised a $7.5 million Series A, which the company shared exclusively with TechCrunch. The round was led by Emerald Technology Ventures with participation from iThink VC, Kamay Ventures, Salkantay Ventures, and The Yield Lab Latam.
Kilimo works with Microsoft, Intel and Coca-Cola, all of which have announced pledges to save water. (Data centers consume large amounts of water, as do beverages.) Trad hopes to sign more. “Not every company alone is going to be able to make a difference. But if you can leverage companies as well as government as well as development bank entities, then you will start to make a difference.