Green & Grow, the US biological agtech company, raised $6 million at the end of August in a Series B round of funding led by Otter Capital, the venture capital firm and leading bio-agri investor.
The capital raising highlighted the growing interest in the sector and the ability to deploy capital in a short time frame, according to Alan Sobba, chief executive and president of Green & Grow.
“There are agtech and bio-agri investors out there who’ve made investments in the space, and for many the allocation of [capital] is very swift, because it’s a smaller pond of capital,” he told Agri Investor.
The environment for exits also benefits from this speedy execution and sustained investor interest as companies operating in the sector look to get ahead of the curve quickly, according to Gregg Spivey, chief operating officer.
“Our value-add can deliver some interesting exits because the [fast] dynamics are favourable for multinationals considering acquiring us in the future; we’re still on an upswing,” he said. “Given the size of the global Ag market we can address with these technologies, if I was a VC fund I would be looking at the Ag Tech sector more closely,” he said.
This recent capital raising is aimed at completing the development and commercialisation stage of Green & Grow’s primary product, Agriplier, a naturally derived seed treatment and soil conditioner, according to Sobba, who was one of the company’s first investors.
“I’d say we’re half way through commercialisation. Our next steps depend on who we’ll choose to deliver the product. The seed treatment product sector is a very competitive one,” he said.
Green & Grow has tested its product in numerous field trials throughout the US, and has advanced on research and development work initiated by the US Army Corps of Engineers. The product performed well in these trials and the company believes this successful run will improve the marketability of the product to distributors and end users.
Otter Capital, has made a range of previous investments in the bio-agri sector including BioConsortia, a soil additive and seed treatment producer – Otter joined Kholsa Ventures in a $15 million Series B round in April this year –, and AgraQuest, a biopesticides company that was bought out by Bayer CropScience for $425 million in 2012. Otter first invested in AgraQuest as part of a $14 million capital raising round in 2005. It later added to its investment.