Mitsubishi values biological startup Gênica at $100 million

Date:08-14-2024

The biological inputs startup Gênica has been valued at approximately US$100 million by the Japanese holding company Mitsubishi Group, which invested BRL50 million for a 10% stake in the Brazilian company.

Before this, in 2017, the venture capital firm SP Ventures had already invested in the startup, founded by a molecular biology researcher from Esalq-USP, Carlos Labate, and a serial agribusiness entrepreneur, Fernando Reis.

Gênica raised BRL68 million in this investment round, also bringing in the state-owned Banco do Brasil, the largest financier of Brazilian agribusiness, as an investor. According to sources close to the deal, an extension of the round is expected soon, potentially bringing the total investment to over BRL80 million with the entry of another Brazilian impact investment firm.

Gênica's relevance in the Brazilian bioinputs ecosystem has grown since agronomist Marcos Petean, formerly of Agrivalle, became a partner and took over as CEO of the company. Under his leadership, the startup made the promise of a "vaccine against soybean rust" a reality, gaining commercial traction and expanding its portfolio of biological pest and disease control products.

Petean also brought other significant figures into Gênica, such as Gerson Marquesi, who leads R&D and also came from Agrivalle. With the BRL68 million raised, the startup plans to invest primarily in Research and Development (R&D) and market access, expanding its reach across different regions and agricultural crops. According to Petean, raising capital is the chosen path to grow at the desired pace and invest in R&D without burdening the company with debt.

With an R&D team of around 30 people, one of the company's significant bets is to launch alternatives to chemical fungicides based on organic molecules. Technicians call this the "third generation of biologicals," meaning products that are more difficult to copy, providing a competitive advantage.

Currently, Gênica primarily serves the soybean market and sugarcane and corn, with plans to expand into other crops like coffee, horticulture, and cotton. To support this growth, Gênica has tripled the area of its factory, enabling it to significantly increase production in the coming years.

Approximately 50% of sales are made through distributors, whether retailers or cooperatives, with the rest through direct sales to large trading clients such as Raízen, BP Bunge, and Cofco. Gênica expects to grow 70% in 2024, reaching BRL230 million in revenue, to hit BRL500 million the following year.

(Editing by Leonardo Gottems, reporter for AgroPages)

---