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Agtech Startup Crop Enhancement Reaps $8.5M for Plant Coating Tech

Xconomy Boston — 

Pesticides are a challenging agricultural problem, because rain washes them off of plants and the resulting runoff can poison other plants, animals, and water systems. Agricultural biotech startup Crop Enhancement is testing a plant protection product that could reduce pesticide use and perhaps do away with these chemical treatments altogether. Today, the company is announcing it has raised $8.5 million in venture capital funding to advance its work.

MLS Capital and 1955 Capital co-led the Series B round for Cambridge, MA-based Crop Enhancement. Also participating was Bandgap Ventures, which joined previous investor Phoenix Venture Partners. CEO Kevin Chen says the round was oversubscribed, leaving the company with its pick of investors.

Crop Enhancement’s technology is a microscopic film that coats a plant and forms a protective barrier against pests. The company’s initial work was in cocoa trees, which are a favorite of the insect Conopomorpha cramerella (cocoa pod borer). The larvae of these pests tunnel into the tree’s fruit and feed on it. Though farmers spray insecticides frequently, Chen says, these chemicals are ineffective due to the heavy and frequent rainfall in the tropical regions where cocoa grows. But Crop Enhancement found that its sprayable film, called “CropCoat,” worked well to protect cocoa pods.

“Our thought was if we could prevent the insect from getting to its food source, we could solve the problem,” Chen says.

The idea of using coatings and protective barriers is a familiar one to farmers. These days, seeds are often coated with antimicrobials, fungicides, and sometimes even beneficial microbes prior to planting. Agricultural fabrics have a place as barriers against frost, weeds, erosion, and insects. Crop Enhancement is bringing the concept of protective barriers directly to the leaves, stems, fruit, and seeds of a plant. But CropCoat’s origins are not in crop protection.

Crop Enhancement emerged from Soane Labs, a Cambridge incubator that has spawned several startups from serial entrepreneur David Soane. Soane, who is Crop Enhancement’s founder and chief technology officer, says the common thread connecting his companies is using “green chemistry” to address unmet needs. For example, Soane Energy developed products that help make energy extraction cleaner and more efficient. CropCoat’s development pathway was paved by earlier work done at NanoPaper, Soane’s most recent startup. Working with trees, that Cambridge company uses polymer chemistry and microparticle science to try to make paper production greener and less toxic.

“Finding polymers or advanced material that would impact soil and plant surfaces turned out to be a direct extension of that work,” Soane says. “Life is very interesting in that once you’re involved in something, another door opens for you.”

CropCoat’s composition is proprietary but Soane describes it as a combination of organic and inorganic components found in nature. The coating is made into a concentrated suspension, which makes it easier for shipping. On a farm, it can be stirred into a tank of water and then loaded into backpack sprayers. The film resists being washed off or rubbed off; Soane says it’s also elastic, which allows it to grow with a fruit. He says the coating is a “platform technology” that could eventually carry additional features, such as a natural insecticide.

Chen and Soane say CropCoat holds the potential to reduce or even eliminate the need for pesticides. That turns out to be a top goal of many new agricultural technologies angling for the market. A recent Research and Markets report calculated that “smart agriculture”— technologies that boost agricultural productivity and reduce the environmental impact of chemicals—will reach $19 billion by 2021. CropCoat can work on staple U.S. crops such as corn, soy, and wheat. But Chen says Crop Enhancement will focus first on crops grown in the tropics, where the problem of getting chemicals to stick to a plant is more pronounced. The company calculates that the crop protection markets for cocoa and coffee are each $1 billion. Citrus, pineapples, bananas, and potatoes together make up a $2 billion-plus crop protection market. In addition to fighting off pests, Chen says, CropCoat could also resist fungal infestations.

Before CropCoat reaches farmers, however, Crop Enhancement needs to complete field trials. The trials are comparing fields sprayed with CropCoat against fields sprayed with pesticide, as well as untreated fields. The objective is to show whether (and how much) the film improves crop yields. The company is conducting field trials around the world in partnership with companies, growers, non-governmental organizations, and universities; Chen says that the lead investors of the Series B round will play a role in expanding these studies. Malaysia-based MLS Capital can assist the trial efforts in Asia because the firm knows the region well, he explains. Meanwhile, 1955 Capital focuses on bringing technology from the developed world into the developing world.

The startup’s new venture cash will also support its regulatory efforts. Crop Enhancement plans to seek approvals from regulatory bodies in countries in Asia and Latin America. In the United States, CropCoat will need Environmental Protection Agency approval, as well as approvals in each state. Chen says the product could become available to farmers in about one year. If and when it reaches the market, the technology’s benefits could extend beyond its protective properties for plants. Farmers spray insecticides every two weeks—more often during the rainy season. In field trials so far, Crop Enhancement found that reducing the need for insecticides saves on labor. The company is still working out the interval needed between sprays, but Chen says CropCoat is saving time and labor costs for farmers.

Crop Enhancement is also moving forward with a second product that encloses particles of a crop treatment, such as fertilizer or herbicide. Soane likens the technology to timed-release medication. While the technology is different, the concept is the same—encapsulation of the active ingredient slows its release. Soane says this “tunable release” would help the environment by keeping fertilizers out of rivers and by easing demand on fertilizers such as potash and phosphate, both of which are finite resources that are mined.

Crop Enhancement has done limited field testing of its encapsulation technology. Since the startup does not make fertilizers, it needs to work with companies that do. Chen says some of the new venture funding will support efforts to find partners that can help test and commercialize the technology.

“Fertilizers are used in pretty much every crop,” he says. “If we can help farmers manage their nutrient delivery, this would be a major advantage.”

Photo of cocoa pods courtesy of Flickr user shankar s. via a Creative Commons license.