Problad
A novel fungicide concept
COHITEC Final presentation
Agenda
1
Fungi and Fungicides
2
Problad Value Proposition
3
Our Approach
4
Financials
5
Q&A
1
1
Fungi and Fungicides
Although the global fungicide market reaches almost $7 billion, fungi
attacks causes approximately $45 billion in crop losses per year.
2
1
Fungi and Fungicides
Fungi fighting is the most dramatic issue that millions of worldwide farmers
have to deal with, still, there are major environmental and economical
problems.
• The only existing solution is the intensive use of chemical fungicides.
Chemical Fungicide
Toxic to:
1
1
1
1
1
Man
Natural
Specimen
Fungicide
Label
Toxic to:
1 Fungi
Host plant
Fungi
Soils
Environment
• The best environmentally safe solution is the use of Natural Fungicides
3
Agenda
1
Fungi and Fungicides
2
Problad Value Proposition
3
Our Approach
4
Financials
5
Q&A
4
2
Value Proposition - features
Our product consists on a unique fungicide of natural origin. This
characteristic distinguishes our product from every other available in the
market regarding its benefits for the final costumer.
Powerful antifungal activity
Low toxicity
Raw material is
an abundant
worldwide
commodity
High
persistance
Problad
Extracted from
an edible plant
Broad spectrum
Patented
protectable
“GRAS” product
reduce time to
market
5
2
Value Proposition
We have a natural fungicide that is non toxic to man and environment and
allows to eliminate several types of fungi simultaneously.
Problem
Biological
Agriculture
Greenhouses
Open Air
Agriculture
Solution
Non-existent natural
fungicides with healing
proprieties
Offer a natural fungicide
with preventive and curative
effectiveness
Chemical fungicides require
safety intervals before
harvesting
Non-toxic product that
allows harvesting in any
time and people
consumption
One fungicide per fungus
type; Several applications,
drastically increasing fungicide
costs for farmers
Elimination of several types
of fungi simultaneously;
“Fungicides are
“Since
we don’t
“Theofexistence
one
the major
have
curative
of asafety
factors
affecting
fungicide
the
intervals
the
grape
emergencethe
of
constrains
production
your
fungicide
economic
costs.
If I can
would
beofa
viability
reduce the
breakthrough
in
greenhouse
number of
organic
crops inand
fungicides
agriculture.”
Algarve.” I
treatments
Portuguese
would save a lot
Pioneer in
of money.”
Agronomic
Organic
Engineer
at the
Agriculture,
Ministry
of
Cardoso
da
Vine
grower
in
Agriculture,
Rocha,
Quinta
Ribatejo,
Jorge
Pedro
Valadas
da Seixas
Comenda
6
2
Value Proposition
Fungicide industry is very concentrated facing an increasing demand for
new products since many toxic substances are being removed from market.
Competition Characterization
Reduced number of allowed active ingredients
Status
“Agricultural products are reaching
the market with high level of
fungicide residues with high
toxicity”
DGPC, Vice-president
Increasing number of fungi resistances
Reduced number of new substances
“Do not make more than four
applications of Quadris per acre
per crop year.”
Syngenta
“One fungicide in development
and one launched in the last five
years.”
2004 Annual Report of Syngenta
7
2
Competition
Problad ends up winner from the comparison with top class fungicides
namely regarding fungi resistances, side effects and costs per hectare.
Usage
Vineyard Fungi
Spectrum
Side
Effects
Safety
Interval
Vineyard
Cost/ha year
1
• Soils
• Environment
• Water
7 days
300 €
From 3 to 15
days
400 €
NONE
300 €
Biological
Agriculture
(Copper sulphate)
Some limitations
Open Air
Agriculture
(Quadris)
No more than 4
times per year
2
• Soils
• Environment
• Water
Problad
Fungicide
No
limitations
4
NONE
Killer value proposition
8
Agenda
1
Fungi and Fungicides
2
Problad Value Proposition
3
Our Approach
4
Financials
5
Q&A
9
3
Time Schedule
We have one year to confirm on the field the excellent results we obtained
under greenhouse conditions. Because we believe in this project we will
fund Field Testing stage with our own resources.
Year
2005
2006
2007
2008
2009
2010
…
Investment
Needs
1st Phase
Company Creation
Field Testing
Certification Process
2nd
Phase
Supply Entrance Markets
3rd
Phase
Start Production
Supply World Market
€120.000
(own resources)
€200.000 –
€400.000
€500.000
€200.000
working cap
10
3
Production
One of the most critical aspects of our project is Production. In the first
years we will use outsourced spare capacity
• Very abundant
and cheap raw Material;
• Simple extraction process
• Represents 30% of COGS.
• Similar to the one used in several
factories in a different market;
• Over 1 000 ton required in
• Represents 60% of COGS.
the first years
• Valuable by-products
• Problad will be available
on different formats;
• Gross margin over 60%
• Over 100 ton sold in
the first two years
11
3
Strategy
Our entry strategy is to address unexplored markets (biological agriculture)
and specific segments like vineyards.
• Target: address large farmers of biological
Entrance
Markets
(2008)
agriculture and vineyards in a B2B model;
address small farmers through established
distribution channel
• Production: use spare capacity of other
factories with similar production process
Proof of Concept / Gain market traction
• Target: establish a worldwide sales and
distribution network;
Global
Markets
(2010)
• Production: build our own production
facilities
Address global market
12
Agenda
1
Fungi and Fungicides
2
Problad Value Proposition
3
Our Approach
4
Financials
5
Q&A
13
4
Financials
The Business model is based on the two phase approach: 1st phase until
2010.
Revenues
# of applications
Biological Agriculture
Greenhouses
Open Air
x
5
10
5
price per application
x
area protected (ha)
Sale Price of €20 per ha
Retail price of €50 per ha
2007
Biological Agriculture
Problad protected areas
%
Greenhouses
Problad protected areas
%
Open Air
Problad protected areas
%
2008
2009
2010
2011
0 ha
0,0%
23.359 ha
0,1%
80.588 ha
0,4%
262.092 ha
1,1%
665.643 ha
2,6%
0 ha
0,0%
115 ha
0,0%
337 ha
0,1%
3.397 ha
1,1%
6.491 ha
2,0%
0 ha
0,0%
7.500 ha
0,0%
15.000 ha
0,0%
78.559 ha
0,0%
617.892 ha
0,4%
14
4
Financials
In 2011 the mix of revenues will be…
2011 Problad’s Revenues Split
140.000.000
61.789 K€
129.911 K€
Open Air
Total
120.000.000
100.000.000
80.000.000
1.557 K€
66.564 K€
60.000.000
40.000.000
20.000.000
0
Biological Agriculture
Greenhouses
15
4
Financials
The peak-funding will be reached on 2007 and accounts for €970.000.
Problad’s Revenues and Net Income
Cumulative cash-flow
160.000.000
25.000.000
140.000.000
20.000.000
120.000.000
100.000.000
Euros
Euros
15.000.000
10.000.000
80.000.000
60.000.000
40.000.000
5.000.000
20.000.000
0
2006
-5.000.000
2007
2008
Peak-funding: €970.000
2009
2010
0
2006
2007
2008
2009
2010
2011
-20.000.000
16
17
Agenda
1
Fungi and Fungicides
2
Problad Value Proposition
3
Our Approach
4
Financials
5
Q&A
18
5
Q&A
Problad Contacts:
Ricardo Ferreira
+351 217780826
[email protected]
Virgílio Loureiro
+351 213859261
[email protected]
Sara Monteiro
+351 217159237
[email protected]
Paula Rosa
+351 217144254
[email protected]
Ricardo Marques
+351 919458303
[email protected]
Luís Costa
+351 938462954
[email protected]
19