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Red Hot: Agriculture & Food Investment Sets Record Pace in 2014

Gannon McHenry

Precision Agriculture has burst onto the scene as one of the most discussed sectors of 2014. This is due in no small part to the recent commercialization of multiple disruptive technologies. Technologies such as drones, formerly limited to military use, are now being deployed on farms to help greatly increase production. Large corporations and venture investors have begun to notice the immense opportunities involved with mitigating the effects of a changing climate and an ever-growing need for better yields.AgInvestment

Total 2014 Q1 venture investment in companies covered by our Agriculture and Food sector was $230M, over double the amount from 2013 Q1. In a sign of the sector’s increasing momentum, the dollar amount of deals made in 2014 has already eclipsed the total for 2013; so far coming in at $331M. Current deal levels are also set to exceed the record number of investments which occurred last year.

The largest individual rounds of the year have so far occurred in the area of genomics. Arcadia Biosciences, a company focused on the production of genetically engineered hardy crops, closed a $33M funding round in early May. Chromatin, a developer of sorghum seed technologies, received $36M in January from a …

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This Deal Matters: Cool Planet Energy Systems Closes Series D Funding; Corporates Bet on Advanced Biofuel and Rising Activities in Asia

Leo Zhang

cool planetCool Planet Energy Systems, the Colorado-based developer of advanced drop-in fuels and biochar, announced a $50.7 million investment and the closing of the company’s $100 million Series D growth equity round. Cool Planet’s latest investors include Concord Energy Holdings, a Singapore-based crude oil trading company, which led the round with existing investor North Bridge Venture Partners. Other existing investors include BP Ventures, ConocoPhillips, Energy Technology Ventures, Exelon Capital Partners, General Electric, Google Ventures, NRG Energy, and Shea Ventures. The new investment, along with Cool Planet’s strategic corporate investors, will help to expedite the company’s 10 million gallon per year biofuel facility in Louisiana. The timing of this deal is significant in that it demonstrates corporate interests in bio-based drop-in fuels, especially given the ongoing commercialization struggle of another high-profile drop-in fuel company, KiOR, which private investor Vinod Khosla has recently committed an additional $25 million from his personal trust to continue supporting the company.

This deal also matters as it is the second deal of back-to-back investments into biofuel companies, following a $60 million growth equity round raised by LanzaTech just a week ago. Notably, we have observed increasing …

Big Data Meets Ag at our Power Breakfast

Amanda Faulkner

On February 14, Cleantech Group, Silicon Valley Bank, and Wilson Sonsini Goodrich & Rosati hosted a Power Breakfast focused on Agriculture & Food. Conversation starters from Monsanto Ventures, Khosla Ventures, AgFunder, OnFarm, and Grundfos, along with over seventy investors, corporates, startup and grower attendees,  discussed topics ranging from the Climate Corp acquisition to labor challenges to local food. Ultimately the conversation returned time and time again to how data can make agriculture more efficient. For those of you that couldn’t join us, here were some of the key takeaways:

food blog

  • Fidelity of data – The billion-dollar Climate Corp acquisition by Monsanto was a popular topic of discussion. One investor commented that Climate Corp offers generalized and public data at a cheap price (combined with a financial product offering). Participants saw high fidelity data as the next frontier for startups to tackle. Although this type of data is more expensive to collect, it is also worth much more to farmers. Regardless of the fidelity of the data, a number of participants emphasized the need to make data more actionable.
  • Origination of innovation – Although startups are the source of innovation, corporates are the players that will likely

Harvesting Innovation: The Changing Face of African Agriculture

Brett Richardson

Africa is in the midst of an agricultural revolution, with innovation driving new avenues for increased crop yields, better resource and capital operating efficiencies, and general farm management knowledge. Africa is home to almost 600 million hectares of uncultivated arable land, or about 60% of  the world’s total. This contrasts the fact that 1/3rd of sub-Saharan Africans are undernourished, with population expected to grow to 1.2 billion people by 2050. The cleantech world is driving the changing scope of African agriculture with an influx of new companies offering innovative solutions which will alleviate stresses to the current system and support farmers.

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Both local and international startups are addressing some of the most basic challenges of agricultural production in Africa. 20%, or 4 billion dollars of grain harvest, is lost every year and 35-50% of fruit and vegetables spoil from crop and storage pests. UK based companies Plant Health Care and Exosect are targeting this inefficiency with pilot projects in Africa using their proprietary crop protection technologies. Plant Health Care provides natural pesticides which leaves no residual impact on the environment and helps to activate certain defensive and growth responses. Exosect also makes bio-control pesticides that can be applied to …

From Farm to Mouth: Local Food Sourcing Companies Bring the Goods

Amanda Faulkner

With the beginning of the New Year comes a spate of well-meaning resolutions, often including a plan to eat better.

Startups have heard that call and are developing ways to give customers better access local produce and goods. The companies use easy order forms, mouth-watering photography, and convenient pickups or delivery to ensure that the process is easy and enjoyable for consumers. For farmers, these sites cut down on middle man costs and waste by guaranteeing set demand on delivery days. Consumers are not the only ones hooked on these services; venture firms have jumped in to fund these companies. Here a few of highlights:

  • Good Eggs is the best known of the bunch, covering San Francisco Bay Area, Brooklyn, Los Angeles, and New Orleans. The site allows users to order a variety of produce, dairy, meats, baked goods, and other staples from local producers. Founded by Rob Spiro and Alan Salant, Good Eggs has raised funding from Sequoia Capital, Harrison Metal, Baseline Ventures, New Island Capital, and Correlation Ventures.
  • RelayFoods has a similar model to Good Eggs, with local food ordered in a central site and delivered to customers. The company is currently focused on the

This Deal Matters: Evogene files for IPO

Amanda Faulkner

 Evogene, an Israeli developer of biotechnologies geared toward developing improved plants for agriculture and biofuel industries through use of plant genomics, filed for an IPO on the NYSE on November 11. The company plans to raised $86 million and would have a market value of $412 million at the midpoint of its proposed range. Evogene has established collaborative relationships with Monsanto, DuPont, Syngenta, and Bayer CropScience, showing real traction with the top players in the industry.

While the public markets have opened up a bit, with BioAmber, Control4, and Silver Spring Networks recently listing, it is still tough for companies in the areas of energy, materials, water, and agriculture to go public. However, Evogene is not the only agriculture company approaching the public markets. Marrone Bio Innovation, a US developer of natural weed, pest and disease management products, raised $57 million on NASDAQ in its August 2013 offering.

With Evogene’s filing, we could see even deeper interest in companies working on geed genomics for both agriculture and biofuels. To see which companies may be on the road to a public offering or could attract large venture rounds, we rounded up some of the most …

The Week in Cleantech: Oct. 28 – Nov. 3

TroyAult

A note to regular readers of this blog – this will be our final “The Week in Cleantech” post. Beginning next week, in an effort to bring you more focused content on specific clean technology sectors, we’ll begin posting highlights of specific deals and why they matter in relation to a broader sector. Now, let’s look at some highlights from last week:

eRecycling CorpsPerhaps influenced by the successful exit of ecoATM in July by investors including Claremont Creek Ventures and Tao Venture Capital Partners, Kleiner Perkins Caufield & Byers and Silver Lake Kraftwerk last week pumped $105 million in Series C growth capital into eRecyclingCorps, a company similarly pursuing incentivized recycling of personal electronics. Instead of setting up a network of kiosks, however, eRecyclingCorps builds trade-in programs in partnership with the all largest mobile phone carriers. Founded in 2009, the company, which also counts SJF Ventures and NGEN Partners as investors, has said it intends to use the funds to support potential acquisitions, geographic expansion and new products and services.

Harvest AutomationThe Agriculture sector again proved to be on the minds of venture investors last week as Harvest Automation, a Massachusetts-based developer of robotic technology for agricultural applications, raised …

The Week in Cleantech: Sept. 23 – 29

TroyAult

The cleantech space produced several new financing rounds, partnerships, and acquisitions last week. Here’s a recap of some of the top deals:

Khosla Ventures announced that it would invest a further $50 million privately into publicly-traded biofuel maker KiOR. The company has missed production targets in the past but the investment is intended to help the company double capacity. KiOR’s stock price jumped 50 percent on the news.

Local foods start-up Good Eggs raised $8.5 million in a Series A round led by Sequoia Capital and joined by Baseline Ventures and others. The round will fuel expansion beyond the company’s current coverage areas of San Francisco, Los Angeles, Brooklyn, and New Orleans.

Synthetic biology-to-chemicals start-up Synthace raised £1.3 million in seed money from Soffinova Partners‘ Green Seed Fund and angel investors. The company indicated that the funding would help it demonstrate production of chemical products prior to approaching the chemical industry to form partnerships.

Zoltek, a publicly traded manufacturer of advanced carbon fiber products for wind power, efficient vehicles, and other industries, was acquired by Toray for $584 million.

Ormat secured a contract with eBay to construct a recovered energy generation power plant in Utah to support …

Hacking Meat

i3 Research Team

The $200 billion food industry in the United States is a broken system in terms of sustainability. Meat production today from traditional livestock sources is land, water, and energy-intensive, and produces harmful runoff and pollution. With a rising population and an increase in meat demand from a growing middle class worldwide, changes are undisputedly necessary. Now that that public opinion has slowly grown towards more environmental consciousness and demand for sustainable meat is rising, there is opportunity for innovators in this space.

For years, different products have attempted to take on the meat industry, with the most familiar example being soy-based meat alternatives like tofu. Recently, interest has been rising in other technologies and food innovations that aim to solve the problem of sustainability in meat production. Events such as the Hack//Meat hackathon, held in New York City in 2012 and Silicon Valley in 2013, prove that there is both interest and opportunity for entrepreneurs and innovators looking to solve the problem of sustainable meat production.

In addition to new mobile apps and web platforms designed to increase sustainability in meat production and help connect consumers to local and organic sources of meat, recent scientific breakthroughs and product ideas …

What Could Bee the Problem?

i3 Research Team

Recently, life for nature’s natural pollinators has been nothing short of a terrifying and detrimental nightmare.  The continuing trend of dying bees is known as Colony Collapse Disorder (CCD).  Estimates show that CCD is responsible for approximately 10 million fallen beehives, worth $2 billion in agriculture and ecological benefits over the last five years.  The most troubling news is that none of us seem to know what causes such a massive population decline to such an invaluable species.  However, recent studies by scientists at the University of Maryland provide new insight and developments on the possible cause of Colony Collapse Disorder.

In the past, researchers and scientists have hypothesized myriad explanations for the CCD phenomena.  Explanations range from mites to cellphone towers, but new data supports one hypothesis as the crux of the issue.  Maryland Researchers collected pollen from hives on the East coast and fed the pollen to a group of healthy bees.  The findings show that the test group of bees developed a serious decline in their ability to resist a parasite that causes Colony Collapse Disorder.  The pollen ingested, on average, was a mixture of nine different pesticides and fungicides that normal bees would otherwise collect and …