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Help me articulate this thought process re CA Ag and Agtech
PART A: 1. CA has a $45 billion Ag industry. 2. California is a desert. 3. California is an expensive state to live in compared to some other US cities. 4. Not least because California mandates liveable wage and has high taxes. 5. We pay a lot for water in California. Cost of Ag is high. 6. California sells most of its industrial Ag produce to the rest of the states in the USA and also exports. 7. These same states have lower cost of living index than California.
Part B: 1. Right now Agtech is focused on the same industrial Ag. 2. Agtech is expensive. 3. Agtech startups serve a process optimized industry on razor thin margins. 4. Industrial Ag is already mechanized. 5. It is limited by geography, soil and crops. 6. Each level of specialization will be an added cost.
PART C: 1. Small acreage Ag is consumer level Ag 2. It is sub optimized and enabled w/manual labour. 3. It requires (relatively) cheaper robotics/physics and not expensive AI/ML. 4. It can be deployed faster with less risk. 5. Think Roomba. It is the full expression of how a robot can be integrated. It is a consumer product.
Q: does it make sense for $$$ California to grow food in a desert with AI only to sell it to regions where it’s sold for wholesale. Isn’t it like ‘buy high, sell low’?
- jelliclesfarm 6y agoI think my head is going to explode. We..the farmers buy everything from input to tech at retail. Retail to companies who give us a ‘wholesale rate’ but fun fact: they don’t have retail or market consumers. We are their ‘retail’. And we sell wholesale. What kind of ass backwards business model is this?
- giantg2 6y agoI have similar thoughts on companies. Imagine how much money a large company could save by moving its operations from a HCOL area like southern CA or NYC to a rural-ish area that is economically depressed (like much of the Appalachian region), or hiring remote work from there.