A growing number of agtech startups are researching biological products that work with the community of microorganisms in and around plants. Denver-based Inocucor has developed microbes intended to improve plant and soil health and it now has $9.5 million in additional financing to support its efforts to bring these products to crops.
The latest investment adds on to a $29 million financing that Inocucor raised last year, bringing the total for that Series B round to $38.5 million. The company says it will use the cash to ramp up production and marketing of its microbes.
Inocucor has developed and patented a process that combines strains of bacteria, yeasts, and fungi, to form its biostimulant products. When applied to plant seeds or on farm fields, or used in indoor growing operations, the company says these products can help improve crop yields, shorten growing periods, and help form healthier and more resilient soil. Inocucor also says that its products allow farmers to reduce the amount of crop chemicals that they apply to their fields.
Inocucor has two products. Synergro is a formulation of live microbes that the company says supports plant roots and improves the quality and the yield of a harvest. The company says Synergro can be used on a wide range of crops, such as strawberries, tomatoes, melons, and fruit-bearing trees. Inocucor’s second product, Synergro Free, is a biofertilizer that can be applied with other fertilizers or herbicides.
The roots of Inocucor were planted in 2007 by co-founders Margaret Bywater-Ekegärd, a physician, and Ananda Lynn Fitzsimmons, an organic gardener. The pair experimented with fermentation as a way to create biological products for plants. Inocucor’s first microbial crop input reached the market in 2013.
Biological startups such as Inocucor have been catching on with investors in recent years. In 2016, $352 million was invested across 30 deals, according to a 2017 agtech investment report from Finistere Ventures, based on data from PitchBook. Though the $100 million Series C round for Boston ag microbials startup Indigo represented a large chunk of the dollars flowing to biological startups, the report says the breadth of deals in this sector shows growing investor interest in biological startups. Indigo, which produces microbial coatings applied to the seeds of cotton, wheat, corn, soybeans, and rice, has since bested its fundraising high mark, raising a $203 million Series D round that closed last month.
Inocucor has been making moves to stand out against other agbio companies. In November, the company hired Shawn Semones away from Novozymes (NASDAQ OMX: NZYM), another competitor in the ag microbials market. Semones is now Inocucor’s global chief technology officer. The Colorado company is also making capital investments. Inocucor is currently building a new, 30,000 square-foot headquarters in Centennial, CO, and is expanding its research and development site in Montreal.
In addition to supporting production of Synergro and Synergro Free, Inocucor says it will also use the new cash to support research and development of more microbial products. The company’s pipeline includes microbial treatments that could control plant diseases affecting potatoes, tomatoes, and strawberries.
Pontifax AgTech led the latest investment in Inocucor. Others who participated include earlier investors Cycle Capital Management, Desjardins Innovatech, and Cairn Investments. The initial Series B round last March was led by TPG ART, the renewable and alternative tech arm of TPG Capital.