Setting the Scene
Water scarcity poses a significant threat to regions like California, placing them on the brink of losing hundreds of thousands of acres of farmland to desertification.
Here are a few ways drought-like conditions affect various industries:
To keep farmland operational, farms pay hundreds of thousands in water overuse bills.
Insurance companies grapple with costs resulting from hurricane and wildfire damages.
Ski resorts deal with revenue loss from inadequate snowfall.
This week’s company is on a mission to keep earth habitable by revolutionizing cloud seeding to create partial rain.
In a Sentence
Rainmaker uses cloud seeding technology to help alleviate global water scarcity.
Cloud seeding: A method to induce and enhance precipitation in clouds by introducing specific chemical agents.
Technology: Rainmaker sends drones into the sky and uses its meteorological software to predict, analyze, and modify weather patterns to maximize the efficiency of cloud seeding.
Bulleted version: Think of Rainmaker as nature's ultimate sprinkler system, utilizing meteorological software, drones, and a specialized nucleation agent to create rainfall. ☔️
The Basics
Industry: Deeptech, Envirotech
Headquarters: El Segundo, CA ⚙️
Year founded: 2023
Employee count: 5
Investors: Long Journey, 1517, Tamarack Global, Starship, Garry Tan, Austin Hubbard, Hummingbird, 1528 Investments*
Amount raised: $1.54M pre-seed
Currently raising: $3.2M seed round is closed and oversubscribed
Business model: Contract based, with clients currently in beta for 60k/year. Once fully operational average yearly contract value will be around $200k-500k per client
Early traction: First contract with California based, E W Merritt Farms
IN PARTNERSHIP WITH
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Due Diligence
WHAT WE LIKE
📈Market opportunity: The global demand for cloud seeding is expected to grow to a market size of nearly $212 billion by 2028.
In addition to farms, ski resorts, municipal governments, state governments, and even the Federal Bureau of Reclamation have shown they are willing to pay for cloud seeding.
✈️ Innovating an old practice: Since the 1950s, the two traditional modes of cloud seeding have been ground-based generators and airplanes, which are imprecise and rely on old practices.
Rainmaker’s product yields precision through its drone technology and weather tracking software, along with a more efficient nucleation agent.
💦 Environmental impact: Water scarcity in the US is transforming California's farmland into deserts and depleting the Ogallala Aquifer beneath the Great Plains, endangering the $92 billion agriculture industry and life west of the Mississippi.
While desalination (making sea water fresh) is one possible solution to combat scarcity, there is an uphill battle to get this to scale on a reasonable timeline.
POTENTIAL RISKS
🌎 Manipulating the weather: While the pressing challenges of water scarcity may outweigh this concern, there might be an ethical dilemma around manipulating natural processes.
😳 Commercialization: The primary obstacle in scaling this operation lies in factors like steep hardware costs and adhering to FAA regulations.
🔄 Rapid market growth: If cloud seeding becomes more mainstream, competitors may engage in improper practices to catch up to Rainmaker.
Founder Profile
Augustus Doricko, CEO: Previously founded and exited Terra Seco.
To request an introduction to the founder, respond to this email.
Comps
Why Rainmaker: By improving traditional cloud seeding methods with precise drone deployment, metrological software, and an upgraded nucleation agent, this company will be making it rain both literally and figuratively. 💸
📌 Bulletin Board
🗞This week in venture: Carta, the $7B software company used by start-ups to track their investors, has been trying to trade its customers’ shares without consent.
If you are a founder who is looking for an alternative platform check out Fidelity Shoobx.*
💡The innovation situation: This app has created a two-sided marketplace to let restaurants and coffee shops charge the public to use the bathroom…
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🗳 Cast Your Vote
What do you think of Rainmaker?
Last Week Month Today
The results are in: Neatsy, an AI-powered app that transforms your smartphone into a tool for muscle pain diagnosis, recovery tracking, and telehealth enablement, was narrowly favored by readers.
Subscriber feedback: “While Neatsy could redefine the future of self-help and digital analysis, I’m curious to see if they can successfully source new clients and retain existing clients who may disconnect once cured.”
