Via AgFunder: BREAKING: Inocucor Brings in Pontifax to Close $38.5m Series B
January 8th, 2018
Offered by AgFunder
January 8, 2018
Inocucor manufactures biological stimulants for agriculture using a patented fermentation process to combine multi-strains of bacteria and yeasts into soil and plant optimizers. It has two products on the market today that aim to enhance the growth of crops: Synergro, a live-cell formulation for high-value produce, such as strawberries, tomatoes, lettuce and broccoli, and Synergro Free, a cell-free bio-fertilizer for commodity row crops, such as soybean, corn, and wheat.
The company held a first close of the Series B round in March after raising $29 million from TPG Alternative and Renewable Technologies (TPG ART), an arm of the $70 billion global private investment house TPG, and existing investors Cycle Capital Management, the Montreal-based cleantech venture capital firm, Desjardin Innovatech, the venture capital group of the Canadian cooperative financial group, and food and ag-focused impact investment firm Closed Loop Capital. Cycle and Desjardin also joined the second close of the Series B along with Denver-based Cairn Capital.
In the intervening months, the Canadian company announced the opening of a Denver, CO office and a forthcoming move into a 30,000 sq. ft. facility in Centennial, CO supported by a performance-based Job Growth Incentive Tax Credit of $1,322,918, this spring.
Research and development will remain in the company’s Montreal office, which will double in size this year. Inocucor has 40 employees and will likely add 25-30 to its team in scientific and managerial positions.
Inocucor has been clear that strategic acquisitions will be a significant part of its growth strategy and CEO Donald Marvin confirmed to AgFunderNews that he will have news on that front in the next few months.
“I think we will surprise a few people because we don’t just look at the microbial space. We look at the adjacent spaces and connect the dots if you will,” said Marvin.
“We think M&A will play an important role for Inocucor’s growth strategy in the sector. The agtech market is still fragmented in many investment areas, including biologicals, which lends itself to consolidation and roll-up,” said Ben Belldegrun, managing partner at Pontifax Agtech.
Inocucor initially focused on high-value crops like tomatoes, strawberries, and lettuce in the organic space since organic growers have fewer choices in terms of crop inputs.
“We went into the high-value produce sector first and we went to the organic growers because they don’t have as many tools in the toolbox and they opened their arms and adopted us quite well,” said Marvin. Synergro is certified organic in both Canada and the United States.
This year, the company hopes to expand distribution all across Canada and continue to develop the Latin American market for its broad acre crop product in Argentina and Uruguay. Western Europe, particularly Spain, is also on the docket for 2018.
The next product in Inocucor’s pipeline will be a biological pesticide. Marvin said that the company is undecided at this point whether that product will be certified organic.
Since it will carry a pesticidal claim, it will require EPA approval that Inocucor’s other products have not. Initial meetings with the EPA have already begun and Marvin expects the product to go to market by in the next 18-24 months.
“We were very impressed with the progress Inocucor has made in bringing products to market, its sales traction and grower adoption. We spent a lot of time with Inocucor customers in order to really understand the significant value proposition and strong in-field results,” Belldegrun told AgFunderNews.