The Most Intriguing New Businesses

A Big Idea for Little Farms


In the countryside of Shanxi Province in north-central China, farmer Xie Xin has struggled for years with water shortages. The 47-year-old, who grows tomatoes and cucumbers, had to pay dearly to use the local well, since the region receives an average of only 16.5 inches of rainfall annually. But this year, Xie started participating in an experiment in which farmers use new irrigation equipment to conserve water. The equipment, similar to a garden hose with small holes every foot or so, is expected to cut his water use by more than half. Through a translator, Xie says he'll save money and boost production by reducing water-related diseases.

The gear Xie uses comes from a startup in Palo Alto, Calif., called Driptech. Although similar kinds of irrigation systems have been used for decades, Driptech is winning business in places such as rural China because its technology is designed specifically for small farms and costs much less than traditional systems. The company's equipment runs $300 for a one-acre farm, instead of the usual thousands, and as little as $5 for smaller family plots. "There are literally hundreds of millions of small-plot farmers suffering from seasonal water scarcity," says Peter Frykman, Driptech's 26-year-old founder. "We're focused on reaching our first million farms as fast as possible."

Experts say low-cost irrigation could alter the economics of food. Subsistence farmers may be able to grow excess crops they can sell. Countries that rely on food imports could see their dependence on outsiders decline. "[These] modern irrigation technologies are the future for water-scarce areas," says Claudia Ringler, a senior research fellow at the International Food Policy Research Institute, a Washington (D.C.) think tank.

The idea for Driptech grew out of a project Frykman worked on last year at Stanford University, where he completed his bachelor's and master's in mechanical engineering. He was looking into drip irrigation, the technique of using hoses and nozzles to drip water only where plants need it, which has spread widely since it took off in Israel in the 1970s. Frykman's breakthrough was the realization that such systems didn't have to be made in large manufacturing facilities and then exported abroad. Instead, they could be made with cheap plastic tubing and compact precision lasers, even in facilities in target markets.

PRO-PROFIT, PRO-FOODFrykman founded the company last June with $5,000 of his own money and set up manufacturing in the second bedroom of his Palo Alto home. The company gradually attracted about $100,000 in grants, donations, and investment, and he moved into an office. "I was drawn to Driptech because, frankly, their success means people are growing food," says Scott Petry, founder of e-mail software provider Postini, who invested $40,000. "I'm not looking for monetary rewards."

Driptech is a for-profit company, and Frykman sees plenty of financial opportunity. His goal is to set up local manufacturing operations so he can lower costs and get the company to profitability. He figures that for $50,000, Driptech can set up a facility that makes tubing for 50,000 farmers per year.

China and India are the biggest potential markets, and Frykman has begun to tap both. In Xie's province, the Lingqiu County government is paying for the equipment for 200 local farms. Liu Wenbo, a county agronomist who has been overseeing the installations, says if the projects are successful the county will buy Driptech systems for hundreds more farms. "I think it will be very useful, not only in China," he says.

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Wong is an associate editor for Bloomberg Businessweek. Follow her on Twitter @venessawwong.

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