Ep 77: Can AI Grow Better Cotton? with Brendan Collins & Tricia Carey

For decades, developing new crop varieties has been slow, expensive, and full of trade-offs. Avalo believes better genetics, better data, and artificial intelligence can change that.

In Episode 77, Andrew sits down with Brendan Collins, Co-Founder and CEO of Avalo, and Tricia Carey, Avalo’s Chief Commercial Officer and one of the textile industry’s most respected voices on fiber innovation and sustainable supply chains.

Together, they look at how new approaches to crop development could create cotton that needs fewer inputs, gives farmers a better chance to make money, and holds up more reliably in a changing climate.

The conversation starts with how new crop varieties have traditionally been developed by selecting for certain traits over many generations. Why bringing one new crop to market can take a decade and cost more than $100 million. And how better genetic data and computing tools can shorten that process dramatically.

From there, they get into drought, irrigation, carbon reduction, regenerative agriculture, and why improving cotton begins long before it reaches a spinner or mill.

They also talk about traceability, farmer partnerships, brand adoption, and the growing need for better information throughout the agricultural supply chain.

Underneath it all is a larger idea: if crops can be developed to work better within the environments where they are grown, the future of sustainability may begin long before spinning, weaving, or manufacturing ever starts.

Thank you to our sponsor Inside Denim.

Brendan Collins
Co-Founder & CEO at Avalo
Avalo, LinkedIn

Tricia Carey
Chief Commercial Officer at Avalo
Avalo, LinkedIn

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Transcript

Andrew 0:01

Today we're going to talk about the future. We're going to talk about a company called Avalo who are working to change agriculture or the way seeds are developed. We're going to hear from two people. One is the CEO and co-founder of Avalo, Brendan Collins, and one is someone many of you might know, which is Trisha Carey. To get going, I'd like both of you, if you don't mind, to introduce yourselves and tell us what it is you do at Avalo. Brendan, maybe you can start.

SPEAKER_01 0:28

Yeah, happy to. Brendan Collins, co-founder and CEO. Our goal at Avallo is really to be able, well, now that we have the ability to kind of sequence the genome really cheaply in really high depth, that's better than we've ever had before. And now that we have these giant computers that can kind of compute a bunch of information really quickly, how can we redesign a breeding program to basically not compromise on all the compromises we used to historically have to make in a breeding program, mostly around complexity? We're trying to bring as much complexity back into the system as possible because we don't have to trade off on interpretability anymore. So that's the main goal. My goal at the company is to make sure it doesn't run out of money. So I do most of the fundraising and basically a glorified admin. And I'll turn it over to Trisha.

SPEAKER_00 1:24

Okay, great. I'm Trisha Carey. I'm Chief Commercial Officer at Avallo. Um, my main goal is to um get the story of Avalo out in the market, build the programs, and get the sales for our products, not only in what we're doing in cotton, but also in sugarcane and in other areas too. Um and it's really been a fun ride so far with Avalo over the past year in order to look at new ways that we can commercialize and use AI in uh in now in agriculture. Um, and so I find this to be a really exciting time and new ways that we can connect science and agriculture together with fashion.

Andrew 2:09

All right, so let me go backwards here. So you use the word AI. It's in our newspapers every day, it's in our media every day. What does it actually have to do with agriculture? Can you explain specifically? Maybe Brendan could take this one. Yeah. I mean that AI doesn't before you do that, or as you do that, can you explain to our listeners, some of them who don't know anything about agriculture development or seed development, how the old way was and what you're changing?

SPEAKER_01 2:36

Okay. Yeah. I can I take that in two different parts. So first, AI, agriculture, and then I guess I'll start with the old system first. Because, you know, I think if you think about how breeding programs have traditionally run, uh, let's say you want to make one of the biggest, brightest, reddest tomatoes on the planet, that's like pretty easy. You would go into the field and you would find the biggest tomato and you would find the reddest tomato, and you would cross those two plants, and hopefully some of the seeds would produce a bigger, redder tomato. And if you do that enough times over generations, you start to get pretty big red tomatoes. Um, but traditionally you can really only select on things that you can see, like things that you we call it phenotypes, but traits that you can physically see in the world, and you have to be able to have some sort of way to quantify them to be able to advance them into the future.

Andrew 3:32

Um I can just stop you there for a second. Yeah, of course. This is not, we're not talking about um genetically modified now. We're talking about hybriding.

SPEAKER_01 3:42

Yeah, we're just talking about very traditional hybridization. So same way that crop breeding has been done basically since we, you know, unintentionally we started crop breeding basically by unintentionally selecting the best crops in the field. So basically we would collect the seeds from the the wheat that performed the best in the field, and we'd plant that out again next year. And that was this unintentional way to kind of keep progressing and moving the genetics of this forward. Um, but like since the days of Gregor Mendel, we've actually started to try and understand that there is like a heritability to this, and our understanding of kind of like modern genetics, you know, started to blossom in that, but that there are traits that you can pass down through lineages. Um, so again, this isn't going into the genome and editing it specifically to get certain outcomes. This is basically a directed movement through traditional crossing or sexual recombination. Um, but the problem with traditional breeding is that if I'm just trying to make big red tomato, and that is the only traits that I'm focused on, there's going to be a lot that I lose along the way. Um, so in, you know, if you look at plants in nature, there's a lot of built-in resiliences. There's a lot of ecosystem stuff that of these complex interactions that traditionally happen in nature that allow them to be more drought resilient. There's a lot of built-in pest defenses within these plants that sometimes when we're going through this process of breeding, we kind of lose out on those because we're not keeping tabs on them as we go. We're just so focused on big red tomato that we keep applying uh and we solve for the pest problems or the growth problems in different ways by adding inputs like nitrogen or applying pesticides to be able to solve those problems for us because we've been just kind of chasing this one big red tomato project. Um, our whole point is that now that we have the ability to both sequence the genome in really cheap ways. So it costs very little to go take the DNA of an individual and look at what makes it different from all the other individuals in the field. And now that we have the ability to process this in large compute, um, we can actually start to say, and now that we have machines that can monitor the fields for us, we can actually start to come up and quantify traits that aren't super apparent to us. So we can actually start to say, okay, this, if we uh look at plants over the entire season and monitor them with drones, we can start to say, hey, this plant looks to be more drought resilient than this plant. And then when we actually go into the DNA of it, when we sequence the DNA of each of those individuals, we can start to say, this is actually what's causing, what's differentiated between that one plant that is a little bit more drought resilient than that other one. And by doing that, we can actually start to say, uh, we have we start to basically be able to give a genetic target about what made that plant more drought resilient. So like we could see redness in tomato, we can now see drought in a plant. And once you have that, you can actually incorporate it into a breeding program, actually start to drive this towards a more drought resilient plant.

Andrew 6:59

So does that mean, I'm just changing the subject, but does that mean that one day we can have big strawberries that also have flavor? Exactly.

unknown 7:06

Yeah.

SPEAKER_01 7:08

That's uh actually that is a project that we worked on because you know, I think like quantifying flavor is a really difficult characteristic. But now that we have ways that we can measure that, you know, there's like we can actually take a lot of the um, it's very funny. You can do this with like mass spec, but they're they have these e-noses now and these e-tongues where you can actually start to quantify the metabolites within taste and scent. And so yeah, you even though I mean, I think strawberries are terrible now, but it would be so cool to be able to go back to to nature and try and bring a lot of those flavors that we've lost along the way.

Andrew 7:45

Super interesting. Your platform basically does what? You replace time in development or cost. Um what is what is your actually strategic advantage?

SPEAKER_01 7:59

That is a good question. Um, so we've we've tried to solve both time and cost. Um I think that, and sorry, this is gonna get a little technical. I'm gonna try and make it as everyone.

Andrew 8:12

Let me just preface this because I have some experience working for a seed company. And in a meeting, they once told me that the difference between our industries, my industry, which was the gene business and theirs, was that they would spend seven years or $35 million on one product and sell it for 25 years. And our business had a new product every 10 minutes.

SPEAKER_01 8:32

Yeah, it's it's pretty crazy how I don't, I I don't think people appreciate how slow agriculture really is. You know, the quote, the the number that Baer will actually continuously put out in uh in literature is that it takes about 10 years and $100 million to bring a new crop to market, which is pretty like amazingly slow. Our goal is to be able to do that in three years for seven and a half million dollars. You can imagine uh if you can actually do it on that cadence and you actually build up a pipeline, we can be doing new releases every single year instead of every 10 years. And so that is our goal of being able to lower the cost in time so much that other crops can uh take advantage of these pretty intricate breeding systems beyond just kind of the two big ones that you mostly see in the US, which are corn and soy. So if we can bring that level of sophistication to any crop, we can really start to improve both our food and fiber systems.

Andrew 9:32

And who owns the data in your system? Because you have a lot of data. Is it Avalos, IP, or is it, or do you share with the farmer?

SPEAKER_01 9:40

So a little bit of a mixture of both. So we do our own research fields where we are, they're not commercial. They are just we take as much natural diversity as we possibly can. So our cotton breeding program uh consists of 600 different varieties, which is a mixture of wild varieties, like literally plants collected in nature, uh, heritage varieties or land, like different land races that have come around from around the globe. So they might have some regional specifications or regional adaptations, and then about 50% of American heritage varieties and uh current elite varieties. And so we put those in Texas across six different uh research plots and literally measure everything you could possibly imagine about these. So we do continuous satellite monitoring, we do continuous weather monitoring, we do several soil samples across the entire uh season so we can start to understand how soil changes and how the different soil conditions are maintaining, um maintaining their moisture levels. Uh, and then on top of that, we do uh bi-weekly drone flights. And so we have this like super in-depth, basically almost digital twin of each of those research fields. So 600 different varieties in each of those. Um, and so we own all that data. We've gone out and mined that, and that becomes kind of the initial data lake that we train on. But then on our production acres, we partner with the farmers. And so that is the farmers' data. We are leasing it back from them. Um, and we are using that to continuously improve our models over time. So, as you can imagine, all farmers do different practices, and so this allows us to start to really understand how those different practices interact with the genetics. And the goal is to be able to combine those two to be able to produce the best product in the world.

Andrew 11:27

But in the end, you have to grow a crop to get seeds, right? Yes. Well, you have to have a lot of farmers to help help you with that. We sure do. So then you have all different varieties and all different experiments, and you look at that, right? Mm-hmm. And that's where the computers really help. That's where the computer's, and that's mostly in Texas, or where is that?

SPEAKER_01 11:47

That's so currently uh Texas is our large scale-up. Um, and so we specifically targeted Texas. Uh, I don't know if a lot of people know this, but traditionally, Texas is the largest cotton-growing region in the U.S. by a pretty wide margin. And it's heyday. Texas was producing about 75% of U.S. cotton, is now down to about 50%. And that's largely because this area has been affected by a massive drought. Um, Texas is traditionally fed by what's called the Ogallala aquifer, which is this giant aquifer that runs we did a podcast on that, on that aquifer.

SPEAKER_00 12:19

No with Brent, with Brent Crossland, right?

SPEAKER_01 12:22

Not a lot of people know about the Ogallala.

unknown 12:24

Yeah.

SPEAKER_01 12:26

Um But yeah, so it's this giant aquifer that runs from the Dakotas all the way down to North Texas, and particularly in the southern Ogallala, it is basically gone. So you have this area that was traditionally about 80% irrigated, it is now about 20% irrigated. But these farmers are still trying to grow seeds that uh were made for full irrigated fields. And so you're starting to see yields plummet and you're starting to see abandonment rates go up, and you're starting to see these huge insurance payouts every single year. So on an average year in Texas, the insurance payouts in just cotton in just Texas is about $3 billion per year.

Andrew 13:03

For the listener, let's let's be really clear. Uh just to explain as an example. I went to a party once in Lubbock, Texas, and um someone was talking to a farmer in the cocktail part. And she said, Oh, I had a bad day. How was your day today? And she said, I had a bad day. She said, I lost my field because there was a hail storm. And I said, Well, you don't look that unhappy. And she said, Well, I get paid out. So they paid her, I think, 75% of what she expected to earn. Yep. So that's a common practice and a common event going on in Texas right now.

SPEAKER_01 13:33

It really is. I mean, so most farmers expect to plant out their cotton without expecting to for it to actually make the crop. So they are basically planting it, expecting that drought or an extreme weather event will kill it, and then they'll take the insurance check.

Andrew 13:49

And you, the listener, you pay for it. Thank you. All right, let's talk about qual quality. Um you talked about the big red tomato. What is it you're trying to do with cotton?

SPEAKER_01 14:09

Specifically, we're well, so we try and work on multiple traits at the same time. That is one kind of cool thing about being able to use AI, is that we're able to track multiple traits in the genome at the same time. So we can try and work on multi-traits simultaneously. Um, the trait that we are actually focused on, and I think this is kind of a cool thing about computes, is that we're actually focused on farmer profitability. And that is the trait that we're breeding for. And so I know that it's kind of like crazy to say that you can breed for profitability, but I one thing I really like to emphasize is that most things that we breed for aren't real traits. You know, yield is the number one thing that is bred for in every crop, but yield doesn't actually exist. Yield is a fit made-up thing that we quantify at the end of the season. There is no yield gene. You can't go into a genome and edit a single individual gene and increase yield dramatically. Yield is dozens of gene pathways interacting with the complex environment to be able to produce amount of quantity of a fruit at the end of the season. Um, but so the same way that yield doesn't really exist in reality, it is quantifiable, and so you can breed for it. Um, so farmer profitability is some sort of combination of yield fiber characteristics that farmers get premiums for in field and the amount of inputs that they have to put on to the field itself. So if you have a more drought resilient, more nitrogen efficient, high-yielding, uh high fiber quality bull, that is gonna be much more profitable for the farmer than um a really intensive uh high-yielding variety itself. And so that is actually whatever that nexus of traits is what we're actually trying to breed for.

Andrew 15:54

All right, we'll come back to that, to you and technical questions in a second. I want to give Trisha a chance to uh to say something. So what is it that you say to people and what is it that you you who do you talk to and how do you present this to the market? What's your your your market action?

SPEAKER_00 16:10

Yeah, well, I think we have a really good example when we were holding up one of our cotton plants and we were meeting with a brand and we said, you know, we're making this cotton using AI, right? Because it captures the attention that we need to look at how we can bring technology and do something different. Um, what I'm usually explaining to whether it's a spinner or working with a brand is how we're using lower inputs, but we're having the same or better quality of cotton. And when it starts to connect with them, that we can still have quality and we can lower the carbon footprint. And specifically, what we found in our initial data from our 2025 harvest is that we've had a 50% reduction in carbon footprint. So to a brand that really stands out to a spinner, they want to know that the quality is going to be the same and not impacted. And I would say probably the other area that we start to talk about, of course, is price. Um, and in this market right now, everyone is so price sensitive that we look at price and how we can bring Avalo cotton into the market at the same level based off of quality and um and environment and genetics that are being used. We're bringing that in at the same price that they would normally buy a regenerative cotton for.

Andrew 17:30

So wait a second. Are you a brand of cotton now, like Supima?

SPEAKER_00 17:34

No, we're not. We are a brand of cotton that we talk about in the market, but we're not going to uh look at having this as a consumer brand, as in a trademarked brand, all the way through at the consumer level. We will leave that up to the brand on how they want to communicate it. So it's not a requirement that they use the Avalo cotton name, but it's an option if they want to. I think over the years, I've learned a lot around co-branding of um ingredient brands. And right now, you know, when you look at a retailer, they have so many stories that they want to tell. Uh, it makes it very confusing. Overall, they want to tell the story of what happened. And they want to tell the story that less inputs are being used. They want to be able to tell the story about growing cotton in Texas, um, not necessarily a specific name.

Andrew 18:29

So let me understand this. We don't have to name brands. You knock on their door and you you tell them that you work with this company that does these things. And who do you speak to?

SPEAKER_00 18:38

Do you speak to the production person or you speak to the Yeah, typically I'm speaking with the sustainability teams and then moving into production teams. The verification needs to first come through the sustainability teams that it works within their cotton uh platform that they have. So if they want to work with USCTP or US Cotton Trust Protocol or BCI or regenerative cotton or whatever they've already set up, we work with them first in understanding what their needs are in their current program. What are their goals? Is it carbon reduction? Is it water reduction? Is it sourcing from a certain region? And so typically we're starting with the sustainability departments.

Andrew 19:25

And how does anyone verify that the cotton they get is through your system?

SPEAKER_00 19:32

That's a great question because we know traceability is key.

Andrew 19:35

So I heard that that recently that was a PK point that actually provisal what or ship what you said you were gonna ship.

SPEAKER_00 19:43

Yeah. Exactly. So for our 2025 program, we were able to work directly with uh select brands. Any uh cotton bale in the US has a permanent bail ID, a PBI number associated with it. We uh worked within a specific region, and as Brendan mentioned, this is in the High Plains, it's in the Lubbock and Amarillo area. So we worked with ginners there. So our 2025 program was rather small at 400 tons. We're able to track that. For 2026, uh, we're working with U.S. Cotton Trust Protocol as a part of their field partner program, and that is being traced through um textile genesis. We are open to working within how brands are normally working within their traceability systems. So if that is fiber trace or other systems that exist, we're open to working with those.

Andrew 20:44

And do people ask for that?

SPEAKER_00 20:46

Um, so far, they are they ask um questions about it and they are happy within the textile genesis framework for now.

Andrew 20:57

They like the certifications.

SPEAKER_00 21:00

They do like certifications. It checks some boxes. However, we've found some brands who are willing and they want to know exactly what the farmers are doing. They like the engagement directly with the farmers. And we feel this is so important. As a program that we are developing, we look at being farmer first.

Andrew 21:19

And how do the mills react? We just say, do the mills just say, oh, ask my customer?

SPEAKER_00 21:23

Most of the mills are which what does the brand want? Some mills step out of that arena and are willing to take their their own direction. Um, and we have some who are very interested in sourcing US cotton and who want regenerative practices. I would say overall the market is shifting towards regenerative, but that's not one common definition.

Andrew 21:54

All right, Brendan, what is the chance of carbon positive cotton? What is the the chance? I mean, why does all cotton have to be like a drain on carbon? Why can't it be? I mean, I think that's a actually I love that it emits it emits carbon.

SPEAKER_01 22:13

Yeah, it is. And I think, you know, the agricultural system does get a lot of I mean, I think people look, because you know, like if you look at a red wood forest, it is very carbon negative in the sense that it is absorbing a lot of cotton. I am carbon, not cotton. Um, but you know, like a redwood forest is absorbing a ton of carbon, and you're not adding any sort of synthetic fertilizer to try and get those giant trees to grow. There, a system has evolved to be able to produce those huge trees in a very actually net negative way. Um, so I think it's pretty natural to look at agriculture and be like, why can't we do that? Um I think that the amount of learning that we're getting right now in terms of different practices, and I think the a place that is still, I would say farmers are skeptical of, but is I think is ripe with potential, is in starting to actually, you know, most of what allows that redwood to grow to its huge height and be very carbon negative is happening underneath the soil. And it's in those microbial interactions and the diversity that exists below the soil that allows the huge plethora of biodiversity to emerge above the soil. Um, and so I think that is a place that we're really excited to keep looking and exploring. And I think that is what will unlock carbon negative cotton, uh, in the sense that if we can really start to understand, I mean if we can really work with farmers and on the genetics and practices to be able to start transitioning and improving their soil health and the diversity within their soil, that is what will unlock most of the carbon benefits. Um, and that is also where you see most of the resilience. If if you can really increase the amount of carbon in the soil, that dramatically increases the amount of moisture that the soil is able to hold on to, which allows us to even push further into the drought resilience and make sure that we're getting good yields and high quality out of a rain-fed system. And so I think the chances are actually pretty good. Um, I do think it is going to take a holistic system. And that's why we try and partner with farmers instead of just selling seed to farmers. We want to work with them on their practices and in a very data-backed way. This is why every farmer that signs up for the program, they get a weather station, they get access to our drone system, they get access to our satellite system, and they get access to all the soil monitoring that we do. And what we're doing is we're building up this huge database of practices that actually work. Um, and we can actually show, in, you know, in a very scientific way, show the farmers the practices that are going to both improve their bottom line and protect their soil. Um, so this is a big initiative that we've taken on. And so we're not trying to sell them any sort of input. We're actually just trying show them that there is a different way. And we're not telling them what to do. We're just working with them and showing them that we can move to a better, better system.

Andrew 25:17

Trisha, do you deal with um the brokers?

SPEAKER_00 25:20

The merchants? Yeah.

Andrew 25:22

Yeah.

SPEAKER_00 25:23

Yeah.

Andrew 25:23

You deal deal with all of them?

SPEAKER_00 25:25

Uh we've had uh some discussions with a couple.

unknown 25:29

Yeah.

Andrew 25:30

And how's that sorry? I'm trying to get over a cold. And how is that going with those people?

SPEAKER_00 25:39

That's going okay initially for 2025. I think our program is just too small for some of the larger brokers to be involved as we continue to grow. I think it's important that we have these discussions. Uh, we are able to ship directly from growers. We have the logistics and the internal um ability to do that. But as we continue to grow, so we started with 2,000 acres working with 10 farmers in 2025. We're actually going 6x in 2026, going to 12,000 acres. Those same 10 farmers have come back, plus we've added more. Um, and so our goal is to continue to grow about more than 5x per year. We will continue to grow in that high plains area and then also looking at reaching out into the southeast US and uh looking at other regions as well.

Andrew 26:36

Okay, let's go to the capital side. Who invests in Avalo? Is it is it the cotton brokers or the merchants? Is it um financial institutions? Who actually has interest in what you're doing?

SPEAKER_01 26:48

That is a great question. So traditionally it was very impact-driven venture capital. Um, so people that were looking at deep tech, so people trying to understand, you know, we started in 2020 before ChetGPT had dropped. And so we were kind of AI before it was cool. But so a combination of deep tech investors, impact investors that really want to see a positive outcome. And now that we've actually started to move into productization, you know, being able to bring cotton and more sustainable crops to the world, we've actually started to see a lot more of the corporate venture side um come into the system that want to support the system and want to be able to create um create resilience within their supply chains. Because I think that's one thing that a lot of these brands are starting to realize is their main ingredients are at risk of either dramatic price fluctuation or even shortages in bad years as these more as climate change changes and the what was once reliable global commodities are becoming less reliable. And I think, you know, if you just look at the world right now, it's it's crazy. Well, it's good for you.

Andrew 27:54

It's I mean, I would probably help your story have a lot of credence.

SPEAKER_01 27:59

Yeah, I I think making, I don't know, I I would rather us be successful in a less dramatic world, but I am glad that we can provide at least a little bit of a calm sea and a pretty, pretty rocky world.

Andrew 28:15

And what about Cotton Incorporated? Do you guys have any kind of relationship with them in the sense of they invest or they help you or you help them?

SPEAKER_00 28:24

We have we engage with Cotton Inc. Um, they visited our facility, we visited their facility, so we have open dialogue with Cotton Inc.

Andrew 28:35

Okay. What about places like India, China, um, Pakistan, Turkey?

SPEAKER_01 28:45

Are you do you mean from like a production standpoint or uh will we look at the world's look at the world's cotton production?

Andrew 28:51

You have India, you have China, you have um Pakistan, you have Uzbekistan, all these places grow cotton, not just the United States. And their farmers and their yields are in many cases horrific compared to, for instance, Australian farmers. How are you how is your business opportunities for those places?

SPEAKER_01 29:10

So we are obviously investigating a lot of these. I we we won't be going on ground in China anytime soon, but um the the whole platform was designed to be able to take kind of a core population and be able to adapt it to regionalities as quick and as cheap as possible. Um, so that is definitely on the roadmap. Um and we are uh taking some sets, basically start doing data access and start kind of being able to understand what the regional specifications are, and so we could make programs there. Um so that is definitely the intention to start to move internationally. But uh right now we are focused on basically delivering a great product in Texas and being able to prove that we can produce genetics in this very extreme environment. And um, what is your competition?

Andrew 30:01

It's a good question. I can't imagine. I can't imagine that the other big seed companies aren't um what's the word, dipping their beaks into the same kind of business um mentality.

SPEAKER_01 30:14

You know, I think it's interesting because the I we get this question a lot, and I, you know, I we really are our our goal is to be the fifth big seed company that we want to be able to create a system that works for farmers that is very different than the way the trish traditional system works right now. And you know, both Bayer and BASF have big cotton programs, which I'm I'm not going to ignore that, but both those companies care about two other crops like significantly more than they care about cotton. Uh so if you look at the pecking order of RD within agriculture, corn will get basically 90% of it. And depending on which company you're at, maybe soy will be on par with that. But then soy will be right below corn. And that is 90 plus percent of their market. And so the cotton programs usually are kind of they get whatever is trickled down to them and left over. And so there isn't actually a huge competition in the cotton breeding market. And the other thing I just kind of want to emphasize is that the big seed companies are really chemical companies underneath the hood. They make their margins by selling Roundup with their Roundup Red. Auxiliaries. Yes. And so they don't really like they don't have an interest in lowering the amount of inputs that go onto the field because they're also selling the inputs.

Andrew 31:36

Yes. Can I stop there? So once when I was working for a seed company, they told me that if I could turn on farmers when I was speaking, I did speeches for them, for the farm community. Someone told me, I can't remember the number exactly, but every time I sold a farm on that seed, um, the auxiliaries amounted to something like $70 an acre, where they made like 60% margin. I believe it. And I started to laugh. I mean, it was like they were even interested in the seed. The seed was cool, but as the other stuff was even cooler. Yeah.

SPEAKER_01 32:05

The like seed companies are vehicles for chemicals. Like the seeds are a vehicle for the chemicals. Yes.

SPEAKER_00 32:13

Yeah, and I think a lot of people don't realize that.

Andrew 32:15

You know, so your business, just to re to rephrase what you said, your business is a specialist in cotton. Your your emphasis is on the specific region of cotton, and your ex expertise will reduce inputs.

SPEAKER_01 32:35

I think that is fair. I would say that our flagship is cotton. We have actually already partnered with Coca-Cola to start bringing a sustainable sugar cane to the world. And so we're specifically targeting that project in, we're piloting that project in northeastern Australia, kind of right next to the Great Barrier Reef, which is the big sugar growing region.

Andrew 32:56

So why doesn't a company like Gilden or Levi's partner with you the same way? Why is it so embarrassing to be in our honestly, it's so embarrassing to be in our industry. And you hear when I hear Trisha talk about Coke, it makes me so mad. You don't have at least two garment companies that want to do the same thing. Why? Why do you think that is?

SPEAKER_00 33:16

I don't know. Um, I mean, we have some that are that we're in discussions with. I do have to say one thing that I've learned um as I've been involved in more of the ag tech side and in working with other companies like Coca-Cola, in the ag tech world, they pay for the pilots. I couldn't believe that. That is so uncommon in the textile and apparel space.

Andrew 33:42

Do you think it's because Coke's margin is better than the other brands?

SPEAKER_00 33:47

No, I wouldn't necessarily say that their margin is better.

Andrew 33:50

Um their mentality is all just different. That's it. Really?

SPEAKER_01 33:56

I so one thing I think is that from my experience so far and like the more food-focused side of agriculture, um, those brands have reached up the supply chain a bit more or more verticalized across them. And so they understand a lot more of the pain points that happen and the risk that a lot of these supply chains are at. Uh, I think they've felt more of the externalities that come through those agricultural supply chains. I mean, so General Mills, for example, had to two years ago had to pull a product for the first time because there was a wheat, uh, there was a drought that affected wheat production in the US and Canada. And so they physically could not get enough wheat moving through the supply chain to make the products that they did. And I think true right now in fashion, so many of the brands, and I think a lot of them are starting to look through the supply chain and trying to understand it better, but have historically just been able to kind of acquire products at the end of the supply chain that they haven't felt or understood the externalities that happen in that supply chain. And without that understanding, I don't, I think without you can't have empathy or pain without understanding. Or like you can't have empathy without understanding. And so, like, without looking into supply chain, without talking to farmers, I think a lot of these brands aren't going to understand the plight or understand the externalities that are really caused by the agricultural supply chain. And so I think increasing that understanding will help solve a company. They've been in here a lot longer than I have.

Andrew 35:37

They need a massive disaster. You know, when cotton went to $2 a pound, a brand approached us and I went with one of the merchants to them to talk about hedging their cotton and to actually place futuristic orders. And the the um the merchant said something which I had never forgot was that American Airlines hedges their fuel, obviously.

SPEAKER_01 35:59

Yeah.

Andrew 36:00

You know, and if you're in a business, it would be clever to hedge the main resource that you're using in your main component of your most important product. But our industry selects not to. All right.

SPEAKER_01 36:15

I think that kind of sums it up pretty well.

SPEAKER_00 36:18

I I do think like people don't know, and it's only over the past couple of years. I think the the spotlight on the supply chain has really come around since the pandemic. And then looking at raw materials even more so, right? People wanna when the Ugreforce Labor Protection Act came into place, people wanted to know where their raw materials were coming from. Didn't necessarily mean that they were gonna buy more U.S. cotton, but they wanted to know where the materials were coming from.

Andrew 36:44

So is is what you're doing a precursor to all of agriculture? Is AI seed development the the the way it's gonna be for all crops? I think yes.

SPEAKER_01 36:57

In the sense that I think AI is kind of like it's too buzzy right now, but I AI is just a tool. It's an efficiency tool. Um and I I think that you know, I think kind of like a silly way to say that is like, do all companies use Excel now? Like if there if there was like a tool that came out or did like all multi-plan.

unknown 37:20

Yeah.

SPEAKER_01 37:21

Like if there's just like a more efficient way to work and be productive, um companies that deploy that effectively will have better margins, they will get product to market faster, they will be able to deliver better products that solve customer pain points. Um, so I think just think of AI as just an efficiency tool. I mean, it's just fancy math underneath the hood, but it just however you use it and how cl how clever you can be with it uh to deliver on actual real-world pain points is what matters. And so uh from our perspective, we've been able to get pretty incredible results applying this fancy math to both the genome and to agronomy in the field. And so uh we fundamentally believe that it is a better way and can make a much better system. So I think yes. It sounds amazing.

SPEAKER_00 38:19

And it sounds like sorry, you're gonna say I was just gonna say, just to add what Brendan was saying, you know, I feel very much that this is a pattern we're going through. I remember in 2000 when everybody was getting on the internet and everybody was trying to find their space in that. It's very much the same right now with AI and what we can do with data, whether that data is efficiency in the supply chain or data towards the genetics, right now everybody is looking, and that's where AI that can review multiple data sets at one time in order to come up with the right conclusions.

Andrew 38:49

But it seems like your company is going through a process in a specific region and um in a specific product. Forget that it's cotton, forget that it's Texas. But the process itself is duplicable. Yes. And theoretically, it would look to me, it would seem to me that other companies are looking at or should be looking at the process and the the case study of what you're doing and bring it out because it can solve national problems. I mean, there's huge amounts of farmers in different places that constantly have depressions because economic depressions, because their farming community can't deliver based on climate.

SPEAKER_01 39:27

Yeah. I mean, I I could not agree with that more. I mean, the you know, like a sound that I think is like absolutely insane is uh if you look at the Colorado River basin, so you have the upper Colorado and you have the Lower Colorado, um, the lower Colorado has consisted of three states, so California, Arizona, and Nevada. Of the water that is taken from the Colorado River basin in those three states, 60% of it goes to forage crops, so primarily alfalfa. And like that's mind-boggling, like that we're growing alfalfa in the desert that needs that much water. It's not regionally adapted. And I think like if if Aval is successful, our idea would be we would really start to tailor crops to the region that actually makes sense with the environment that it is, instead of trying to create this kind of like artificial Eden through huge amounts of water and nitrogen to actually force these plants to grow, we can actually start to design plants that actually need to grow into the in those regions.

Andrew 40:32

In the regions. It sounds amazing. I'm I'm sold. I think what you're doing is fantastic. All right. So what is the if you grow 5x, I haven't I can't do the math, but you must because you go get money. What does it look like in 10 years?

SPEAKER_01 40:47

If we in 10 years, I mean within five years, we should be at $300 million in revenue uh across our multiple supply chains, um, which is great. It turns out there's a lot of cotton in the world.

Andrew 40:59

So that's even, you know, if you make the same margin that other seed companies make, you'll be making 50, 60 million a year. Yeah.

SPEAKER_01 41:07

Which, you know, wouldn't be too bad. And I think our investors would be pretty happy with that. Um, but you know, so really in 10 years, the goal is to be able to take what we've done in cotton, sugarcane, and keep replicating this across the most important supply chains in the world and the agricultural supply chains in the world. Um, and we've been pretty intentional about that roadmap and what crops we go after next. Um, but we should be well into five plus crops at that point.

Andrew 41:38

Any last words that you want to share with our listeners? I'll give it to Trisha.

SPEAKER_00 41:43

Last words. Well, um, a couple, a couple thoughts. Uh, I think most of all, just to summarize for Avallo, we're looking at better genetics, better practices, and better data, putting all of that together.

Andrew 41:56

Um Can I just paraphrase that another way? Sure. Going from crummy data and crummy product to an improvement. It's not like it's all fantastic now.

SPEAKER_00 42:07

I know. That's true.

Andrew 42:09

So this is really very futuristic. Sorry to interrupt.

SPEAKER_00 42:12

That's great. That's great. And and Andrew, I just want to say, you know, how much uh I appreciate the opportunity to work with you for so many years and the wisdom and the stories that you bring. It's always a pleasure.

Andrew 42:25

That sounds like an obituary.

SPEAKER_00 42:26

No. I think we don't we don't um express our appreciation for those who we do work with. And I think it's important that we stop and say that once in a while.

Andrew 42:42

Well, thank you very much. I always get nervous in those things because I'm a big fan of a TV show that probably most people never heard of that was called SCTV. And it was the Second City TV. It was in Canada. And a lot of famous actors were in that. John Candy, all sorts of different people. The one that died, O'Hara, Catherine O'Hara, all these different people were in that show. And one of it was about it was about a TV station or a network. And one of the shows was a talk show. And the whole talk show was John Candy basically telling everyone how great they were. Oh, I saw your last show. It was so fantastic, and your suit is so beautiful. And everything about you, and you're so funny, and you're so smart. And after that, I really got I got really, really nervous. So that was part of that show. And when people say something nice, that is like you know, not really. Anyway, I think what you're doing is fantastic. Um, we're going to promote you as much as we can through our genes land and wish you all the best of luck. And um we hope you hit all your targets faster than you want. Thank you so much.