Sustainable food and agri-focused firm Seed 2 Growth Ventures (S2G) has led a $10 million funding round for biological pesticides business Terramera.
It closed its $125 million fund in October 2015, having already deployed roughly $25 million across eight companies focused on building a healthy and sustainable food value chain.
ACA Investments, an affiliate of the Sumitomo Corporation with $900 million under management, Bold Capital Partners, and venture capital firms Renewal Funds and Maumee Ventures also invested in Terramera.
The company will use the funding to bring its plant-based biological pesticides to market, and expand its Plasma Power brand. India-based Plasma Power, which Terramera acquired in 2014, sells products including an Environmental Protection Agency (EPA)-registered cold-pressed neem oil, marketed as an insecticide, fungicide and growth promoter.
Terramera uses a proprietary delivery platform to improve the performance of biological inputs, making the move to organic production easier. The company is currently working on plant-based fungicide and nematicide-based biochemicals, including ones which are not harmful to bees.
S2G’s fund executives previously told Agri Investor that weak supply chains for organics have been a major challenge to the growth of the sector.
“Biopesticides and biofertilisers, which currently represent a small but growing part of the agriculture inputs market, are the next frontier for sustainable agriculture,” said S2G managing director Sanjeev Krishnan. “One of the key issues holding back quicker adoption has been performance. Terramera has developed a technology that solves that, allowing current biologics to perform more effectively.”
Although farmers in the US can benefit from premium prices for organic food, requirements for production such as eliminating traces of chemical fertilisers, herbicides and pesticides make it difficult for conventional growers to convert farms. Biological inputs offer one potential solution for these growers.