Indigo Ag started as a company focused on microbial agriculture—finding microorganisms to develop into seed coatings intended to boost crop yields. While microbiology remains a focus, CEO David Perry says the startup is positioning itself to take on additional aspects of the agriculture business.
Boston-based Indigo is revealing one of the ways it aims to reach deeper into agricultural transactions with the formal launch today of an online platform for selling grain. The startup is supporting this software, called Marketplace, in part with a $250 million Series E round of financing.
Marketplace (screenshot below) provides a digital platform where farmers who sell grain can interact directly with those who buy it, Perry says. The technology gives farmers a way to differentiate their products, and get better prices. Buyers are able to choose from crops that have specific characteristics, such as organic or non-irrigated. Perry says Marketplace was developed to replace transactions that today take place mostly by phone.
“We knew when we started Indigo that microbiology had the potential to be a real positive, but it alone couldn’t change agriculture,” Perry says. “To change agriculture we had to change every other aspect. We’ve been putting those pieces in place.”
Base transactions on Marketplace are free, Perry says. But Indigo will charge for coordinating transportation, and allowing farmers and buyers to hedge prices. Perry says that, over time, Indigo’s plan is to bundle pricing of its services on Marketplace. Though helping farmers sell their grain is different than selling microbial seed coatings to them, Perry says the efforts are related. The software will help farmers get paid more for their commodities, which in turn will drive demand for Indigo’s microbial products, he says.
Indigo quietly introduced Marketplace in the spring—in time for the current growing season. Since then, the company says farmers have entered more than $6 billion worth of inventory on the system. Meanwhile, buyers have entered 4,000 bids, representing more than $2 billion in demand. Indigo is currently licensed as a grain dealer in 40 states where it is already doing business, and it expects licenses in the remaining states in coming months.
Though Marketplace is new, software has been a key part of Indigo from the company’s 2014 start. Indigo also has proprietary software that uses algorithms and machine learning techniques to understand how microbes help a plant. The company then develops those microbes into a seed coatings that impart specific benefits, such as drought tolerance, to the plant as it grows.
Indigo’s latest financing comes nine months after the company raised $203 million in a Series D investment round. Besides supporting the expansion of Marketplace, Indigo plans to use some of the new capital to help sell its current microbial products, as well as develop new ones. To date, Indigo has launched 19 total microbial products across five crops.
Indigo’s early focus was on developing microbial treatments that help crops hold up better in dry conditions. Perry says Indigo plans to expand into new applications, such as helping plants use nitrogen more efficiently, which in turn will mean farmers can use less fertilizer. Indigo is also researching microbials that could help plants resist pests and diseases, which would allow farmers to use less chemicals on their fields. That research is based in Research Triangle Park, NC.
Indigo’s latest funding round comes from earlier investors, including Baillie Gifford, Investment Corporation of Dubai, the Alaska Permanent Fund, and Flagship Pioneering, as well some unnamed new investors. Indigo now says it has raised more than $650 million total.