Boosting the blue economy: Ocean 14 Capital invests in Brazilian tilapia farmer

Tilabras’ production model allows the fish to be fed on a fully sustainable, plant-based diet, while minimizing the CO2 footprint, said the investors.

The Ocean 14 fund is aiming to capitalize on the opportunities around tilapia as a growth market as part of its ongoing mission to find sustainable solutions to improve the health of the ocean.

Tilapia aquaculture is six times more efficient at converting plant-based feed into animal proteins than cattle farming, and the fish is also more affordable than other commonly farmed fish, such as salmon, making it an extremely viable protein source for the growing global population, according to the London based fund, which focuses primarily on investing in growth-stage businesses.

Max Holtzman, director of operations, Ocean 14 Capital, expanded on the investment: “In terms of our alignment with Tilabras, sustainability is a key driver in all decision making. This, combined with it being an outstanding financial opportunity, makes this a natural partnership. The impact case for the investment is intrinsic to the increase in production of farmed tilapia.​

“Tilapia is one of the most efficient forms of not only seafood production but of protein production worldwide. Increasing the availability of this highly sustainable protein source to a larger population will serve to increase the share of sustainably sourced protein worldwide. Given that demand for animal protein will remain, tilapia is the number one protein to fill that need.”​​

Deployment of funds​

Holtzman declined to comment on the profit margins of the family-owned Brazilian business, but told us how the funds will be deployed: “Ocean 14 Capital’s funds will be utilised to expand Tilabras’ production and processing capabilities, while simultaneously focusing on improving production efficiencies and establishing the company as one of the most sustainable producers in the whitefish marketplace.”​

Also weighing in on the deal was Nicolas Landolt, founder, Tilabras, who said Ocean 14 Capital’s expertise, knowledge, and the fund’s ability to execute will help the company to enhance growth while improving resource efficiency, through the building of hatchery and breeding operations, as well as the expansion of farming operations and the processing plants.

Looking at the Brazilian market dynamics, Holtzman said that tilapia now accounts for around 55% of the total domestic farmed fish output in the Latina American country.

“Brazil imports approximately US$1.3bn in fish to meet the internal market demand. The expansion of the availability and affordability of tilapia will continue to make fish consumption more accessible. Brazil produced approximately 400,000 tons (2018), out of a global total of 6.8m tons in 2020."​

Tilapia farming sector in many parts of the world faces disease challenges. What is the Brazilian company doing to mitigate such risks?

“Tilabras’ strong focus on robust biosecurity protocols throughout the entire farming process, focusing on people, processes, and places, is a strong preventative measure to reduce impact of potential pathogens and incidence of disease,”​ said Holtzman.

Indeed, the tilapia industry, at large, continues to improve through strong R&D and on-farm practices, throughout the entire life cycle of the animal to further reduce the incidences of disease, continued the representative.

Investments to date ​

First launched in December 2021, the Ocean 14 Capital impact investment fund has already made three investments this year:

SyAqua, a shrimp breeding technology specialist was among the first beneficiaries of the fund​​ along with AION, a Norwegian plastic management platform that uses proprietary technology to offer ‘Circularity as A Service’ to large-scale industries, and MITO, a clam hatchery and breeding Italian company.

“Ocean 14 Capital focuses on five specific verticals. Investments in both alternatives to fish protein and aquaculture itself may include investments in aqua feeds. The other three verticals are sustainable fisheries, circular plastics, and marine flora/seaweed,”​ added Holtzman.

This month, the Ocean 14 Capital fund received a commitment for €10m from the Constitutional Reserve Fund of Monaco to support its mission of funding sustainable solutions to improve ocean health. With this backing from the sovereign wealth fund, the Ocean 14 Capital €150m impact fund is on track to invest in eight companies this year, and to grow its portfolio to between 20 and 25 businesses within three years.

The private equity firm has now raised €100m for the fund since inception.