Growing veggies from rock could make Vietnam based Orlar operation Australia’s first Agri-Tech unicorn
A coal miner’s daughter from Newcastle has invented a new form of vertical farming and has set up in Vietnam. One Dutch fund thinks it could be a billion- dollar company.
Lyndal Hugo is a scientist and entrepreneur with a knack for metaphor. This is how she describes the difference between using microbes in hydroponics and deploying them in her vertical horticulture system, where they grow on rocks.
“Just imagine you’re a microbe,” she says. “You’ve been thrown into a river, and you spend all day and all your energy just swimming, right? You can’t really replicate or multiply. You hit a change in PH, a drop in temperature or you suddenly get exposed to oxygen, and you’re like, ‘Holy shit!’
“Now imagine you’re that microbe and someone throws you a beanbag. You jump on it, and then you get thrown pizza and beer. What do you do? You sit back, watch the telly and think, ‘This is the life.’ ”
It’s been more than seven years since Hugo explained her plan for beanbag-happy microbes to an early investor over lunch by the Brisbane River. Hugo and her partner, Amanda Cornelissen, cashed in their super to finance their venture, Orlar, and three years later decided to take it to Vietnam.
Happy microbes equal happy plants. Traditional farming relies on microbes in soil to pass nutrients on. Vertical farming differs by growing crops in stacked layers in a controlled environment using “soil-less” techniques.
Hydroponics, which washes nutrients over root systems, is the best known form of vertical farming.
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When we all go to the vertical market in the sky, we can say we did our bit to help get the world on a better footing.
After several major setbacks, including a false start in humid jungle surrounds where creature comforts were few and a pandemic lockdown that has just begun to ease, Orlar might be on the edge of something big.
The company has caught the eye of the Australian government, the Dutch Fund for Climate and Development (DFCD) is a supporter and another believer and early investor is former Commonwealth Bank and NAB executive Peter Coad.
“My focus is not primarily on whether Orlar can be a successful, innovative farming venture in Vietnam. It’s more on does Orlar have the capacity to do something significant and wide-ranging.
“Now the technology has been proven, we can think about how it can be used in both first-world countries – through commercialisation and sustainable farming – and in developing countries.”
Orlar’s patented technology will be on display at COP26 this week, showcased by the DFCD. Orlar is soon to move – or graduate, as the DFCD describes it – into the second stage of the fund’s development model.
This will open the door to financing options including debt and, perhaps even more importantly, demonstrate the company’s systems have been audited by Dutch engineering consulting firm Royal Haskoning. Interested parties will have independent authentication of Orlar’s claims on low energy and water use, zero emissions and no contamination, and high crop yields.
Orlarock is special
At the company’s four farms in Vietnam’s central highlands, Orlar’s 81 species of microbes are living their best lives in thousands of two-metre- high plastic vertical growing pods housed in giant glasshouses. Fruits and vegetables sprout from 12 points on each pod, their root systems trailing back into the pod where they meet the rocks and microbes.
These rocks, imported from Australia, have a very particular mineral make-up and surface chemistry. They are so special they have their own name: Orlarock. In every gram of rock there are trillions of microbes feeding the plants.
“Everyone has always thought it would be best to grow microbes in water,” Hugo says. “But we have demonstrated what we can do when a microbe attaches to our rock. We’ve invented a new growing system that changes what’s possible in intensive horticulture.”
Alex Downs, DFCD’s business and investment officer in Asia, believes Orlar has the potential to become a unicorn. A $1 billion-plus valuation is a long way from where the company is now, with 65 employees and two farms on just 1.1 hectares of land. Judging on yields to date, the company calculates that 1.1 hectares, if given over solely to lettuce, would yield 335,280 kilograms of produce a year. That’s close to eight times the amount from a broadacre farm – and with zero carbon emissions.
Singapore-based firm EverEdge has valued Orlar’s intellectual property at between $20 million and $80 million. The company’s “comfort figure” is $30 million. There is, however, a lot of blue sky that could house glasshouses with Orlar pods. Downs is backing it for the same reason the DFCD got behind it in the first place – because Orlar’s technology solves problems.
Orlar Directors: Cass Le Gardner, sales and marketing; Lyndal Hugo, chief executive; and Jacquie O’Hara, asset development
in a Ho Chi Minh supermarket.
He explains that Orlar is not a mitigation project designed to deal with the impact of climate change. Rather, the Orlar technology is what the DFCD describes as an adaptation play.
“Orlar is a very strong adaptation investment for us. It’s a new farming method with a very low environmental impact that’s producing high- quality food,” says Downs from his base in Ho Chi Minh City.
“We are required to make at least 65 per cent of our investments in adaptation solutions. These are higher risk than projects that support climate mitigation – but they also offer higher returns,” he says.
The DFCD is also pleased to be backing Australian technical expertise coming into Asia. “Asia is a growth market, and we need technology from developed markets. What Lyndal Hugo is doing is a great example of that,” Downs says.
Hugo’s career has progressed along two themes, agriculture and mining. Orlar is the result of her determination to find a worthwhile overlap between the two. She did a doctorate on pesticide residues and then post- doctoral studies on residues and how they get into cattle. After some consulting work, she went back to her roots: mining.
“All my family are coal miners from the Hunter Valley, so I spent some time working in that industry. Then I left the corporate world to see if something valuable could be produced from mining and gas waste water.”
Exploring the interaction of microbes and solid surfaces using complex microbiology and chemistry led to some promising ideas. “Amanda said I had 12 months to make it work. Seven years later, here we are.”
That time frame could probably have been truncated if the couple had stayed in Australia. But Hugo was on a mission. “I knew there was a massive need for clean food in Vietnam and other developing nations. We could have made more money a lot faster elsewhere, but we could not have the same impact and created the same long-term goodness that we have here.
“We didn’t want to just make the best food. We came here to build a clean, affordable, ethical, sustainable, fresh food company that creates jobs and invests in people,” she says.
Orlar measures its environmental impact by the number of residue tests it has that are completely free of residues. So far, the company has 100 per cent clean tests.
“Everything from Orlar was designed to be positive: positive for the environment and positive for people. We have to be able to grow at a low price so we can have the biggest possible addressable market,” Hugo says.
After the couple moved to Vietnam in 2017, they built a prototype of the system on a balcony of their Ho Chi Minh apartment before trying to get their first farm up and running in Cam My, a small rubber village close to the city. The site would ultimately prove unsuitable. Eventually, the pods were packed up and moved to a location in the hills near the city of Da Lat, more than 200 kilometres away. The company put in 4000 extra pods and started selling its produce and building another farm. Cornelissen, a horticulturalist, thought edible flowers would attract interest. They did.
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