Growing up in Ethiopia during the 1980s, Sara Menker was exposed to the extremes of privilege and poverty. While her parents were middle class and she attended an excellent private school in the capital city of Addis Ababa, many of her countrymen suffered from famine and civil unrest.
After meeting an admissions officer from Mount Holyoke College in Massachusetts when she was in high school, Ms. Menker wound up attending the small liberal arts school for women. From there, she joined Morgan Stanley in New York, where she began trading commodities.
But she never stopped thinking about food insecurity. While on Wall Street, Ms. Menker became captivated by the global food system and its inefficiencies. In 2014 she quit and founded Gro Intelligence, which uses artificial intelligence to forecast agricultural trends.
Gro, which is private, has raised more than $125 million in funding and has offices in New York, Singapore and Nairobi, Kenya. Drawing from thousands of data sources, the company predicts things like where soybean prices are headed, how climate change will impact arable land and what’s going on with Brazil’s coffee crop.
Customers include HSBC, Tyson Foods and the US Chamber of Commerce. And Ms. Menker, who in 2017 delivered a TED Talk predicting a global food crisis, is still fretting about feeding the world.
This interview was condensed and edited for clarity.
Can you tell me a bit about growing up in Ethiopia?
I grew up in Addis in the ’80s. It was sort of at a time when Ethiopia was in the news. There was a famine and poverty and all of those things. It was a very different time than it is now, but I feel like it shaped a lot of who I am today.
I grew up in a pretty good, solid middle-class family. My mother was a seamstress for Ethiopian Airlines. My father worked at the United Nations Economic Commission for Africa.
One thing about Ethiopia is that it was never colonized, so it was the center for African countries to come together. Addis was the city that African leaders descended upon to discuss things like decolonization. So I feel like I grew up more connected than not to the rest of the world, because growing up, Addis, even while it was in the news, was very much a cosmopolitan city of many different nationalities that lived there because it was sort of this melting pot of diplomacy.
Even if you didn’t experience the famine personally you must have been deeply aware of it and affected by it.
What is inflation? Inflation is a loss of purchasing power over time, meaning your dollar will not go as far tomorrow as it did today. It is typically expressed as the annual change in prices for everyday goods and services such as food, furniture, apparel, transportation and toys.
A thousand percent. First of all, you have to remember we come from massive families. My mom has 24 siblings. And you grow up very much aware of it. I grew up in a country where fuel was rationed, where food, sugar, toilet paper was rationed no matter who you are. It didn’t matter if you lived in Addis or outside of Addis. When toilet paper shortages happened during Covid and everybody was running to stock up, I was like, “I don’t know why you’re stocking up. I have like 80 rolls of toilet paper.”
People were like, “Why do you have 80 rolls of toilet paper?” And I was like, “Is that not how one lives in life? In fear that things might run out?” But it is how we were raised, very much aware that you can’t take anything for granted, that anything can disappear. We had neighbors that disappeared.
How did you wind up coming to the United States for college?
I studied really, really hard. I wanted to get out. My parents sacrificed absolutely everything to send us to the best school in the country, and I knew every day that my obligation to them was to do well, because they gave up most of their income to make sure we went to that school.
Also, my dad was born in an Italian prison. My grandfather orchestrated the plot to kill General Graziani when Mussolini tried to colonize Ethiopia, and it ended up costing his life. They assassinated my grandfather when my grandmother was pregnant with my dad, and they took her as a prisoner of war to Italy, and she gave birth to my dad in an Italian prison. So I was raised in a pretty strong family, in that fighting for survival kind of way, and I just felt like I owed it to my family to do well in life.
When you joined Morgan Stanley did you figure you wanted to be in finance for the rest of your life, or were you saying, “I got to get out of here as fast as I can”?
I decided that the only job I would take in finance would be to work in commodities. It was the only section of finance that I felt was connected to the real world and all the things I cared about. One day I got up and I decided I was ready to trade. So I went to my boss and said, “Hey, you’re going to hire me to trade natural gas.” He was like, “I’m not hiring.” And I was like, “No, no, you’re going to hire me.” And he did, so I started trading gas, and then he got promoted, and I took over that business.
But eventually, I didn’t have a passion for the work anymore. I had become sort of like a robot. I went to work every day. I was really good at what I did. I actually loved the people I worked for. It was a weird industry to work in. I mean, the energy industry hardly looked like me, put it that way.
When you got bored at Morgan Stanley, did you know exactly what you wanted to do?
Yeah. Big cam from the financial crisis. The stock prices of all the banks were about to go to zero, and I had a colleague who literally thought the world was coming to an end. He thought the best hedge to make was buying as much gold as possible. All day long, he’d be buying bars of gold, gold coins, gold ETFs. He also bought a lot of guns. And I’m just like, “What are you doing, dude?” I was just viscerally angry at him for thinking that Morgan Stanley’s stock price going to zero was the end of the world. I was like, “First of all, I know what the end of the world looks like. This ain’t it. And second of all, how are you going to feel when you trade a bar of gold for a sack of potatoes?”
So despite him, I looked at buying a little bit of agricultural land, thinking it was actually a good hedge to inflation to have a piece of land where I can grow my own food. And that made me realize how messed up the agricultural systems around the world were, and how very little of it made any economic sense. I didn’t end up investing in the land, but I ended up investing tons and tons of time learning everything I could about agriculture, and I just completely got obsessed.
How is it that we’ve been talking about food security for decades, and yet every time I ask a question I’m only getting more questions? Every time I seek an answer and I’m trying to find the data, I can’t find what I need? I became really attached to that problem. And I thought, “What can I do for Africa?” So when I quit, it was basically with this very loosey-goosey idea around, “I’m going to start a company and it’s going to do something around data and agriculture.”
“I love us humans, but we’re not such good people.” —Sara Menker
You’ve spoken over the years about sort of a food crisis. Do you still believe that we are facing a global food crisis?
If you look at inflationary pressures around the world today and the amount of food inflation that we’re living through, it’s astonishing. Look at how much food prices are up year on year, even in the US, and the US is blessed to be literally self-sufficient in every sense of the word when it comes to food. So when you think about how that translates in a world where currencies are getting decimated because of Covid, and the economic realities that exist, our food systems are just strained. And the reason you have inflation is actually because you’re facing an unprecedented number of supply and demand shocks happening at the same time. If you think of the vegetable oil market and Canada’s drought in the last year, or you look at the price of oats, it’s up like 70 percent year on year, because most production is in Canada.
There’s a structural inability of markets to adjust to this type of thing happening, and those weaknesses still exist, and demand is growing faster than we thought on a per-capita basis. Supply tries to keep up, but it’s sort of just this merry-go-round that we’re living in. We haven’t fixed our systems to deal with that, and that’s what keeps me up at night.
Do you think there are too many people on Earth? Are you a little Malthusian in the way you think about all this? Or can planet Earth sustain nine billion humans with ever richer tastes?
We can sustain it. There’s two places where you get growth from. One is through yields: grow more on the same amount of land. Second is expand the area, which is not what we want right now, because most of that expansion of area is basically deforestation. This is why there is a tension between economic growth and ecological preservation. So the question you ask is, how do I grow production? How do I grow yield?
Some vegetarians suggest that a shift away from a meat-intensive diet is sort of a silver bullet. If we drastically reduced the amount of meat that’s consumed, would that solve some of our problems?
It’s not a silver bullet. It’s baby steps. And we should take all the baby steps we want to take. But I don’t think we should make false promises. And if you look at per capita meat consumption even in the US in the last 10 years, it’s gone up. It hasn’t gone down. I mean, it’s human nature. I love us humans, but we’re not such good people.