Meet the founder: FYTO’s Jason Prapas on ‘turning a nitrogen problem into high-grade protein’ for dairy farmers

[Disclosure: AgFunderNews’ parent company AgFunder is an investor in FYTO.]

Fast-growing aquatic plants such as lemna present an intriguing new sustainable protein source for humans and animals, provided you can find ways to grow and process them cost-effectively, which is easier said than done.

But they can also help farmers manage their manure, which can cause major headaches on dairy farms, says FYTO founder Dr. Jason Prapas: “Ultimately we’re turning a nitrogen problem into high-grade protein.”

A mechanical engineer who started his career in algae biofuels and learned some hard lessons about trying to compete in established commodity markets with novel ingredients, Prapas has developed an automated system for growing aquatic plants such as lemna in open lined ponds on dairy farms utilizing manure as a feedstock.

The protein-packed lemna—which is grown without pesticides or herbicides—can in turn be used as feed for cows, providing an alternative to soy in feeding regimes in addition to helping farmers manage their manure.

California-based FYTO also has preliminary data suggesting that consuming lemna can reduce enteric methane emissions in ruminants, a leading source of greenhouse gas emissions on dairy farms.

AgFunderNews (AFN) caught up with Prapas (JP) to talk duckweed, manure, and the circular economy.

AFN: Your first job was at GreenFuel Technologies, an early algae biofuel co that went bust. What did you take away from that experience?

JP: It was formative in so many ways. I loved the experience. It was such a Willy Wonka factory place to work, full of smart people working on such an important problem. The combination of biology and engineering and the commercial aspect was really fascinating to me. But it also kind of ruined me forever because it was my first job out of college and I wanted [to replicate] that dynamic, interdisciplinary experience over and over again.

I guess the biggest lesson is I never wanted to grow algae again! I wanted to turn 180 degrees and run as fast as I could away from something that looked like that, so it’s kind of ironic that I find myself doing something at FYTO that at first glance looks similar, but I would argue is quite different. A common question I get is: ‘Do you guys grow algae?’ And I say ‘No, absolutely not!’

Algae has tremendous potential but it’s high-cost, high-complexity, and it’s very difficult to isolate the algae you want from algae you don’t want. We were always chasing our tail in terms of keeping control of the system for long enough to produce enough stable product for testing at any sort of scale. The lesson I think is a high CapEx system with a lot of complexity is going to have difficulty competing with a commodity anytime soon.

The other thing that’s relevant to the work I do now at FYTO is that the aquatic plants we grow now float, whereas algae is neutrally buoyant, which means that it takes a tremendous amount of energy to separate it from the water. You also have to constantly circulate the nutrients so it takes a lot of energy growing it, not just harvesting it. Whereas when you have something that floats it naturally gets its needs—sunlight and carbon dioxide—from the surface. It’s also much easier to mechanically harvest, so in that way, it’s more like farming than biotechnology.

AFN: If aquatic plants are fast-growing and floating on the surface, though, you’ve presumably got to harvest them at the right time at high-frequency so you can optimize your system?

JP: Yes, absolutely, and these plants [that are grown at FYTO such as lemna] have got their own sets of challenges, which is why we are a technology company, not just a farming company. We had to develop a harvesting method that could keep pace with the plants as they also grow very fast and you have to tend to them in the right way or they will spiral out of control.

AFN: So tell me about the genesis of FYTO…

JP: At this point [2019] I was convinced that aquatic plants could be an incredible foundation for the food system. Many cultures throughout the world have known this for thousands of years, but they hadn’t been farmed or intensively cultivated on purpose.

And what I learned early on is that it’s a lot of work to take care of them manually, and frankly it wouldn’t make sense to me to try to farm aquatic plants using manual labor. It would be too expensive and frankly too much drudgery for the people doing it.

So I could see that we would need to design from the ground up the farming method and the equipment and technologies that allow these plants to be grown at scale cost effectively.

AFN: What’s attractive about aquatic plants such as lemna/duckweed in the first place? Did you always see this as an animal feed play?

JP: I did look at human food applications and I’m rooting for companies in that space to succeed. Lemna make a lot of high-quality protein incredibly quickly that is suitable for feeding humans and animals.

So I’ve always been interested in the direct [human] food applications, but it never felt right for us to begin with, as I could see big, messy problems we could address immediately and I really liked the synergy of working with livestock operations where the waste streams from those facilities, which create huge challenges for producers and the surrounding communities, could be a great feedstock for growing lemna.

So that to me was just a very natural synergy to have our partners have this waste stream that they needed to recycle or upgrade and for us to have a feedstock that was a great choice for lemna but wouldn’t necessarily be a great choice for other crops.

AFN: What species of aquatic plants did you look at? 

JP: There are thousands of varieties around the world with meaningful differences in terms of their composition, their growth rates in different environment, and how they respond to different stressors. For example, some are sensitive to salinity while others are quite good at growing in brackish water.

So a big part of our work is building out the knowledge base or what we call the bio library of crops that can be pointed to a different application, because the crop that works really well for recycling dairy effluent and turning it into a protein for a cow might be a different species than the one that does the same thing for a poultry operation.

But right now we’re growing a wild type of lemna that is native to California, so we don’t do any genetic modifications. It basically emerged early as a fast grower and a very high protein content producer, so we’re consistently seeing about 40% protein by dry weight, which is really exciting given how fast it grows.

AFN: How does it compare to other sources of protein used in animal feed?

JP: In crude protein terms it’s similar to a soybean, but these plants grow much more quickly, plus the soybean is a very small fraction of the biomass of the plant, whereas all of the lemna we grow is being harvested and used in the feed. Alfalfa has around 17-18% protein by dry weight and has an important form of fiber for the digestive tract of a cow, so I don’t see us directly competing with alfalfa.

But we think we might have benefits beyond just being a substitute protein source for soy. We’re starting to see evidence that we can have an impact on the enteric methane emissions of ruminants through a different mechanism than for instance the seaweed companies that are disrupting the microbes in the rumen.

AFN: You’re growing lemna in lined open ponds with no overhead netting now? 

JP: We’ve tried a bunch of different coverings but in the last growing season, we’ve moved all the way to not covering the ponds and instead dealing with the things we were controlling for in different ways.

One of the biggest environmental hurdles to growing lemna at scale is wind. Wind will take these plants and push them around like little sailboats and they pile on each other. It’s not damaging in that moment but when you look at the effects over days, weeks and months, you’re ultimately limiting the amount of area that the plants are growing on because they’re piling on each other.

So instead of blocking out the wind, we have been breaking up the wave action caused by the wind by using floating barricades that look like swim lane dividers you see in swimming pools.

AFN:  Your core tech is the automated monitoring, feeding, and harvesting systems?

JP: Yes, so if you look at the unit operations to growing aquatic plants, we have to have inoculum production [lemna reproduces vegetatively through production of buds that separate from the mother plant] and know that we’re starting with a clean, healthy crop. Then we have constant monitoring of the water chemistry that the plants are growing in.

And then we look at plant health, at things like chlorophyll, any foreign objects, and that’s where the major tool that we’ve developed comes in. You can think of it as an aquatic combine. It’s basically an EV tractor that we designed from scratch that’s purpose built to farm lemna and other aquatic plants.

And it does that by monitoring with computer vision, detecting the density and health of the crop, and then pulling out the appropriate amount of the crop and diverting it to downstream processing so it can be prepared for sale or for consumption by an animal.  And that’s our core IP.

It’s basically a 50-foot wide robot that runs on lithium batteries and has sensors and actuators on it that allow you to maintain a consistent specification for your crop. And that’s a really powerful tool because it would take way too many laborers to do that effectively over acres and acres.

AFN:  Why do you need such constant monitoring? Isn’t the composition and growth of the plant fairly predictable?

JP: Because of the incredible rate of growth of these plants, they’re inherently volatile relative to soil-based crops, where you actually have time to see what’s happening and take corrective action, and even then, you see a lot of farmers struggle to make the corrections quickly enough.

But our crop grows 10-15 times faster per day, and you start to realize that if you don’t get things attended to properly, they will spiral out of control. So the types of things that you have to think about and what makes it not really a recipe but actually a biological system is that if it’s cloudy on Monday and sunny on Tuesday, it’s going to change what your harvest on Wednesday.

And similarly, the nutrients that it needs to continue multiplying quickly need to be adjusted in accordance with its growth. We also need to maintain a healthy mixture of that crop within any given square meter.

The chemistry of the operation will also vary from operation to operation because each farm [that supplies the manure that serves as a feedstock for the lemna] has a different profile of waste. So we have to adjust the harvesting and monitoring technology to accommodate that.

AFN:  What inputs does lemna need and how well does animal manure meet those needs?

JP: In the wild it will tend to grow mostly in freshwater and typically, there’s some nitrogen in that water; so if you want to see it growing rapidly, it tends to be downstream of a livestock operation [where nitrogen from manure gets into the waterways].

In a lot of large dairy operations, they will often store liquid waste in a lagoon that might be several acres wide and several feet deep. Now this is typically applied to the land because there’s no other economical option to dispose of it. But it’s actually out of compliance for many of them to apply it to their land and the nutrients may ultimately contaminate the groundwater.

But manure is a great input for us because we are growing probably the fastest nitrogen consumer on the planet with lemna. If you feed it as much nitrogen as it can take, it’s going to be very hard to compete with anything that can eat nitrogen faster than lemna.

So it’s a really important value proposition to a dairy farmer to operate one of our lemna farms, whether or not they actually use our feed ingredient, because they have this nitrogen reduction potential and can operate in compliance with regulations.

AFN: How does your operation work? Are your lemna farms co-located next to manure lagoons?

JP: Yes. We’ve currently setting up a multi-acre facility right next to a lagoon on a commercial dairy operation in Tulare in the Central Valley of California. And that’s going to generate a really important set of data for us. Early indicators are that a fraction of their land would allow us to fully solve their nitrogen problem [from manure].

The inputs we need [for lemna to grow] are not just nitrogen, but phosphorus, potassium and other nutrients, which are fully available in the waste stream, but because the profile of each effluent stream is slightly different, we may have to address that by varying the inputs here and there.

We’ve grown lemna on 26 dairy effluent streams from the Central Valley and one of the first things we look at is pH control. If the plant has a sub-optimal pH range, for example, it won’t necessarily die off but you’ll see your yield plummet. But the good news is most of the farmers in California have some form of pH control and there are scaled cost-effective methods for pH control that we can we can leverage if the waste gets too alkaline.

But beyond that, we have not seen evidence that we need to add anything else, which is really exciting… plus we don’t use any herbicides or pesticides to grow our plants.

AFN: What’s the business model at FYTO?

JP: Certainly in the first stage of commercialization, we’ll build, own, operate, and finance [lemna] farms because it would be very difficult to convince anyone that’s busy farming cows to become an aquatic plant farmer.

What I have seen though, is once we’ve run pilot operations and people see what the plants can do, we get the question pretty early: Hey, when can I buy one of these?  We think an exciting second phase is when we can start to achieve scale through partnerships.

At the facility in Tulare, we’re already getting data that looks good and within a couple months, we should be in full swing with multi-acre production. This is a very important project for us because it’s demonstrating that we know how to grow these plants at scale.

We’re looking at the entire Central Valley of California because it’s this combination of highly regulated nitrogen concern, and also it the highest concentration of cows in North America.

AFN: How CapEx intensive is your approach?

JP:  We find ourselves in a funny financing middle ground where it might be too cheap CapEx for a typical renewable project finance model, although we don’t expect to sell the equipment outright to farmers in the initial phase. But we’re starting from really good first principles and foundations in terms of costs.

AFN: How is the lemna treated after it’s harvested?

JP:  You can feed the fresh material to cows, and we’ve done that extensively with good results, but if you’re going to try to sell it in a shelf-stable form for a customer that’s off site, you’re going to have to dry it. So we’ve done scaled drying from our R&D farm in Petaluma, California, and we’re going to be repeating some of that work and upgrading it and improving it.

I’d say the bulk of our automation work has been on monitoring, harvesting, and conveying. But where we see other opportunities for automation is in downstream processing. How do you take it from harvested form to a dry shelf-stable form in a quick and cost-effective way, so that’s going to be a big part of our work in the coming year.

AFN: If I were to visit a scaled up FYTO operation, what would I see? Do your farms basically run themselves?

JP: If we’ve done our job effectively, you’ll struggle to find a person, as a huge part of our investment in this technology platform has been about involving as few humans as possible.  But there would be someone that’s engaged in supervisory control and making sure everything is running well.

AFN: What interest have you had from the market?

JP: Starting with conventional [dairy farmers], the biggest inbound requests we tend to get is on the waste handling aspect of our technology and the fact that the feed production could pay off the hardware basically, so they are excited by that dual value proposition.

But the first thing they want to figure out is how they can be nitrogen compliant with their manure handling.

Organic dairy farmers tend to lead with the feed side of things where they have fewer choices when it comes to sources of organic protein that are reliable in terms of supply chain volatility and price. They tend to be excited by the idea that there’s this soy-like thing that could be grown literally in their own backyard.

But ultimately we’re turning a nitrogen problem into high-grade protein.

If we’re talking about big brands that are involved in milk processing, they are also interested in the sustainability angle of their supply chain and scope three emissions. How are we going to get to anything like carbon neutral dairy?

And I think we represent a unique possibility there. Dairy cows in California are incredibly productive in terms of how many gallons of milk a cow can produce, so that equation has been largely optimized. But on the waste handling and feed side of things, there is a big opportunity for sustainability to be profitable. So that’s really our mission: to have farmers take part and profit from this transition to a more sustainable way of feeding their cows, poultry and other animals while also solving this waste handling issue. It’s both a large greenhouse gas issue and also a water quality issue.

But beyond dairy, we have a lot of interest in looking at other feedstock partnerships in poultry and pig operations potentially.

There’s also a big deficit of plant-based organic fertilizer inputs and we’ve had a lot of inbound inquiries on this, so we’ve started to test it and had some really exciting results in using our plants as fertilizer.

There are organic fertilizer markets where the price point is not obviously worse than the feed market. We have to be humble and understand that we can’t take on everything at once, but we’re actively exploring the market potential.

AFN: When will FYTO start generating revenues?

JP: We have clear goals to start generating revenue this year. We took a deliberate step toward nailing the technology and unit economics and profitability before we started to chase earlier revenues.

But you have to have scaled production to get customers interested, on acres not fractions of acres, to interest the types of customers that buy tons and tons of feed.

AFN: Not everyone that’s worked with lemna has been successful in recent years. How has that impacted your approach?

JP: It’s difficult for anyone trying to develop a new cropping system as it’s an unknown field of study, so you have to have the research infrastructure in place. But a huge advantage for lemna is its fast growth, and not just for the yield but for the ability to be a platform for research.

Typical soy farmers might get 40 tries in their lifetime to try different things on their crop, whereas we can try new things 40 times a month, so we’ve amassed hundreds of experiments since we started. I look back at what we thought we knew in 2019 and 2020 and 2021 and then at what we know now, and the trend is very good in terms of how much we’re learning about growing these plants.

But at the end of the day, it’s always a race against time for any startup to prove enough quickly enough where you can get traction in the marketplace.

There’s always a tension between having enough scale to be meaningful to your customers but also making sure that you’re not following that deadly founder path of, ‘If I build that they will come…’

So you have to you have to prove the product-market-fit early, which I think we were able to do with studies of feeding cows and chickens. And then we focused our efforts on making sure that scaled production with attractive unit economics was the next step.

AFN: How much money have you raised so far?

JP: About $18 million in venture capital dollars, plus we were fortunate to get a $2 million grant from the state of California for commercialization.  We will be able to complete this farm in Tulare with the cash we have on hand. And then that’s ultimately a proof point for the next raise so that we can start to really get into growth mode.