Invested Development’s $20 million early stage equity impact fund BSP Fund has made a commitment to Rowbot Systems, an US agtech company. The deal represents the fund’s third direct agriculture investment.
Rowbot Systems is developing robot technology for use on cropping farms. It has several abilities but its biggest benefit to farmers will be its ability to apply nitrogen to crops in the middle of the season when the crops are tall, according to Christina Tamer, investment analyst at Invested Development.
“Applying nitrogen twice in the year instead of just once can be a big cost saver and yield enhancer but high clearance machinery can be expensive so this is where the Rowbot steps in,” she said.
BSP has also invested in Promethean power systems, an Indian company producing rapid milk chillers, and OnFarm, the farm data aggregation. Invested Development took part in OnFarm’s second round of Series 1-A funding — it has gone on to raise $700,000 in convertible notes through the online fundraising platform AgFunder.
Invested Development is currently fundraising for another fund the Impact Factoring Fund that will provide companies will alternative types of funding such as promissory notes or other types of quasi-equity. Most of the companies tapping this resource are portfolio companies in BSP.
“The Impact Factoring Fund provides working capital to companies in different forms,” said Tamer. “We saw a need for tools other than equity in our BSP Fund portfolio. Sometimes companies need to wait a while for customer payments so flexible tools like purchasing discounted accounts receivable may work better for their balance sheets than issuing more equity.”
BSP Fund closed in September 2013 on $20 million after around three years fundraising.