Flokk Positioned to Support Traceability in Canadian Cow/Calf Productions

Canadian cow/calf production is a $CDN 2B industry where ¾ of its 60,000 producers manage their herds with pen and paper. This entire industry must digitize by 2025 to achieve compliance with federal animal identification and traceability regulation. Flokk offers the compelling solution for this pressing customer need with a non-negotiable deadline.

Flokk was “Born on a Ranch in Dogpound”. The entire Flokk team has hands-on experience in livestock production, ensuring we understand, empathize with, and consistently convert, our prospects.

Flokk offers a low risk and capital efficient route to early profitability, sustained revenue, and acquisition, through the rare situation where:

• A stick: Mandatory regulatory compliance
• Carrots:
  • Subsidized acquisition
  • Revenue growth
  • Cost savings
• A solution: Rapid and effective digitization

Come together to provide the opportunity to dominate a multi billion dollar greenfield. Flokk is Precision Ranching Realized. Proven at scale in Canada, Flokk will lead digitization of the $1T global livestock industry.

I am writing you today to offer the opportunity to profit from this unique opportunity through participation in Flokk’s $CDN 1M pre-seed round opening May 1, 2023.

Flokk is uniquely positioned to secure market dominance in digital livestock herd management:

• Flokk provides an accurate and current “digital twin” for every animal in the herd.
• Validated through testing at the Olds College Smart farm and two complete production cycles of field testing.
• Designed for commercial cow/calf operations. Most competing products were designed for seedstock/purebred operations, so are unnecessarily complex and expensive for commercial operators, the vast majority of industry participants.
• Flokk’s acquisition by customers will be ½ subsidized through Sustainable Canadian Agricultural Partnership (SCAP) programs.
• Flexible, subscription based revenue model delivers immediate ROI to every prospect while driving frictionless revenue growth.
• Extensive engagement with customers, the regulator, the responsible administrator, industry associations, and media have established the profile necessary to rapidly and efficiently go to market.
• Flokk’s built for purpose, integrated, handheld device enables every day and all weather use at the animals side at an implementation cost ⅙ that of existing products.
• Flokk offers rapid and simple implementation.
• Independence from application stores (e.g. iOS App Store, Android Apps) provides an unmatchable 30% revenue/price advantage over our competition.
• Flokk, uniquely, will also be offered for outright purchase, a requirement for consideration by many prospects.

Flokk’s customer base is growing:

• Beef continues to be the premium food protein demand for which has grown, and will grow, with global income.
• Alternate source proteins have been market tested and proven incapable of matching the palatability and affordability of beef.
• Other beef producing localities are now, and will increasingly be, constrained by water and rangeland availability.
• As the sole agricultural enterprise achievable and sustainable by a typical family, beef cow/calf will resist the consolidation typical of other agriculture sectors.
• Beef can, uniquely, use rangeland intensification to mitigate price competition from export markets and biofuel for field crops.

With a product proven at scale serving Canadian cow/calf producers, Flokk will be positioned for significant and rapid revenue growth through:

• Serving other livestock producers (sheep, cervids, goats)
• Automating auditing/reporting for practice certification programs (e.g. Canadian Roundtable for Sustainable Beef)
• Supporting direct off-farm marketing of feeder calves
• Authoritative initiation of blockchain based food safety and traceability regimes
• Reporting and auditing required for monetization of GHG (methane) mitigation products
• US market
• International markets
• Application of the Flokk platform to other domains

Recent developments include:

April 7: Flokk supports industry engagement on proposed regulation amendments

With the cooperation of the Canadian Food Inspection Agency (CFIA), Flokk is hosting recordings of industry information seminars presented by the CFIA.

April 3: Government of Alberta (GOA) launches “Farm technology program”

As part of the Sustainable Canadian Agricultural Partnership, the GOA has introduced the Farm Technology Program. Eligible expenses for this program will be cost-shared at 50% grant and 50% applicant. Flokk explicitly qualifies for this program as an Eligible Expense, Category 4, “Herd management handheld devices”.

Apps on consumer grade hardware, the solution offered by most competitors, will receive minimal support from the program as “Items that are commonly used for recreational or non-agricultural purposes (e.g., iPads, TVs, and recreational drones)” are explicitly ineligible. Flokk is actively pursuing partnerships towards establishing a single application, integrated, and assured process for cow/calf producers to receive this benefit.

April 2: Flokk releases commentary on Verdant partners “Global Food & Agribusiness Annual M&A Review”

Verdant partners prepared a review of global agribusiness merger, acquisition, and fund raising activities in 2022. We have prepared comments specific to Flokk and the Canadian AgTech space that demonstrate Flokk’s positioning for customer acquisition, revenue generation, and exit.

March 28: Flokk’s president, Mark Olson, featured in CBC Alberta’s “My Priority” project

Mark provided a summary of the challenges rural Alberta faces delivering its contribution addressing global food insecurity. A companion background article provides thought leadership on Alberta’s role in this new reality.

March 27: Canada gains full access to Japanese beef market

Japan removed the final outstanding restrictions to imports of Canadian beef, ensuring continued growth of this $CDN 0.5B market.

March 20: “Regulations Amending the Health of Animals Regulations (Identification and Traceability)” published in Canada Gazette I

Flokk’s extensive work engaging producers, the regulator, responsible administrator, provincial administrator, and industry groups has positioned Flokk as a leader in this transition.

March 16: Flokk engages engineering firm for hand held production readiness

Flokk has entered into an agreement with a Calgary area engineering firm to refine, and prepare for manufacture, our hand held device.

February 22: Flokk identified as one of top 10 most investible AgTech companies in western Canada

Flokk was included in the top 10 for the Startup TNT 2023 AgTech summit.