Dec. 18, 2017
Boston-based bioagtech startup Indigo Ag continues to announce new funding benchmarks, raising an additional $47 million from new investor, Investment Corporation of Dubai (ICD), to bring its Series D to a total $203 million.
This second close, which gains ICD a Board Observer seat with Indigo, follows an initial close on the Series D at $156 million, announced by the company on September 26 that included Flagship Pioneering - Indigo's founder and flagship investor; the Alaska Permanent Fund; and new investors Baillie Gifford and Activant Capital.
Indigo, which was originally created within Flagship's in-house incubator VentureLabs, is working to answer the need of feeding a booming world population of 9.7 billion by 2050 through microbial research.
Over time, agricultural methods including the use of insecticides, herbicides, fungicides, and fertilizers have increased agricultural output, but yields have plateaued in recent years, with average annual yield increases of just over one percent. In addition, these methods have disrupted plants' beneficial microorganisms, or microbiome, in the same way that science has learned that antibiotics can disrupt a human's beneficial microbiome.
Using cutting-edge technology, Indigo identifies beneficial microbes that naturally exist within plants. The company then isolates and applies these microbes to crop seeds resulting in greater resilience in the face of a range of stressors including drought, pests, and diseases, and higher productivity. Initially, the company focused on microbes that help plants thrive under water stress, but has since broadened its focus to build out a portfolio of products that help plants under a range of growing conditions, including microbes that improve nitrogen uptake and efficiency in row crops.
"Indigo is working on solutions that address the massive problems of food security and the effects of agriculture on environmental and human health," said David Perry, Indigo's president and CEO. "Emerging technologies in the fields of microbiology and data sciences make solving these problems possible, and financing from firms such as ICD, Baillie Gifford, and the Alaska Permanent Fund ensures that Indigo will have the capital that we need to take on these challenges."
All told, this round makes Indigo the highest valued privately held agtech company of the year so far, and follows one year after Indigo announced it had closed on a $100 million Series C led by Alaska Permanent Funds and including Flagship Ventures, members of the company's board and management teams, and other unnamed repeat investors.
Total funds raised by the startup now exceed $400 million, and the company, which recently opened its first international offices in Argentina and Australia, said that this latest tranche of capital will be used to support its continued global expansion, the development of software and data tools, the company's exploration of the plant microbiome, advance the widespread adoption of the company's microbial technology, and the ongoing discovery and commercialization of products that increase agricultural yields while reducing the need for synthetic agrichemicals.
Last year, Indigo announced that after isolating and testing beneficial microbes on crops across three continents throughout three growing seasons, the company had conducted cotton trials that resulted in a 10 percent increase in yields in the face of environmental stresses including drought conditions, indicating the potential for improvements in productivity and economic return.
This success led the company to announce last year the launch of its first commercial product - Indigo Cotton, which was planted on more than 50,000 acres across five U.S. states. This was followed by the company releasing Indigo Wheat - which after being planted in 2016, resulted in average yields increasing by nearly 16 percent, reflecting a per-bushel premium of 43 cents. Maintaining its momentum, the company has begun production of Indigo Corn in the spring of this year, and has published preliminary data gathered from commercial fields across the U.S. Midwest reflecting yield increases of up to 77 percent, or an additional 40 bushels per acre.
"ICD looks for disruptive companies with potential to change industry paradigms - companies like Indigo," said H.E. Mohammed I. Al Shaibani, executive director and CEO of Investment Corporation of Dubai. "With a strong foundation in microbial technology, Indigo has built something much broader. It has the opportunity to fundamentally improve the agriculture business on a global scale."