Arvegenix, a pennycress oilseed producer and processing company, closed a $2.5 million round of Series A financing, which included a commitment from new investor Monsanto Growth Ventures.
Returning investors included biotech venture investor BioGenerator and Missouri Technology Corporation, a public-private partnership promoting entrepreneurship. Other new investors in the round were Monsanto Growth Ventures, Cultivation Capital, Prelude Ventures, St Louis Arch Angels, Black Creek Capital, Prolog Ventures and Yield Lab, according to a press release.
Founded in 2013, Arvegenix produces various products from pennycress including oil that can be converted into methanol or biodiesel.
Arvegenix has raised nearly $3 million in funding to date, Dannis Plummer, head of business operations, told Agri Investor. Plummer said the company will wait until it has the next two harvests before raising the Series B round, which will be late 2016.
“This Series A funding will enable us to expand and accelerate our research and development programs to achieve increased yields for our new crop pennycress, to conduct regulatory feeding studies on the press-cake, and develop our growing and crushing operations,” Jerry Steiner, chief executive of Arvegenix, commented in a statement. “Recently, we have been encouraged by the performance shown with initial breeding program crosses in our field tests. We have also added very strong talent to the R&D and development team in the areas of crop breeding and animal nutrition.”
Pennycress oil can qualify as an “Advanced BioFuel” feedstock under the Renewable Fuel Standard, according to the Environmental Protection Agency (EPA).
Along with the deal, Rick Holton, general partner at Cultivation Capital, a St Louis-based venture capital firm, joins the board of Arvegenix.
Investment into the biofuels sector has increased in recent months after Flagship Ventures launched its own agbio company, Symbiota, injecting $7.5 million in its Series A fundraising round, in November and in March, the firm partnered with Red Rock Biofuels to develop its first commercial-scale refinery.
Getting into the biofuels space is inevitable for energy and aviation industries given the issues of energy supply, Pratik Shah, partner at Thomas McNerney, a VC firm, told Agri Investor in an earlier interview. “The vision has always been compelling – what’s been missing is the hybrid crop that can deliver.” Thomas McNerney & Partners invested in SGB, a San Diego-based biofuels and agtech company, in its Series C round last year in September.