ZeaKal, a biotechnology startup focused on improving agricultural productivity, today announced a $5.3 million Series B financing round, bringing total funding to date up to $9.1 million. In conjunction with the financing, ZeaKal also acquired Algenetix, an industrial biotechnology company developing renewable materials and energies from plant-based sources.
The oversubscribed round was led by Finistere Ventures with participation by Middleland Capital and several leading family office investors. With this funding, ZeaKal will expand its PhotoSeed product development pipeline and bring its lead soybean product into field trials this May.
“The need for innovation in the farming and food sector is important not only for farmers and consumers, but also for AgTech itself,” Arama Kukutai, partner at Finistere Ventures, said in a press release. “The current consolidation among the big AgTech companies and low farm commodity price trends are cyclical. When these conditions change, there will be strong demand for new technologies to fill that innovation void. We back game-changing companies that deliver value from farm to the consumer in a sustainable manner and think ZeaKal is a revolutionary technology play in plant sciences.”
Improving resource management is the first step, but ZeaKal’s founders are adamant that the world needs better biology to cope with increasingly severe environmental pressures.
“As the world population increases to more than 9 billion people by 2050, we need to develop the next generation of crops that can cope with the food supply demands,” said Henry Nguyen, curators’ professor of genetics, National Center for Soybean Biotechnology at the University of Missouri. “Both conventional breeding techniques and biotechnology will be needed to increase the genetic gain in yield and improved drought tolerance in response to climate change. However, this is an extremely complicated area of research that has yet to make significant breakthroughs commercially. ZeaKal’s impressive out-of-the-box technology approach to increasing photosynthetic efficiency and carbon fixation addresses the shortcomings of previous science strategies.”
ZeaKal’s PhotoSeed technology is an example of next-generation biology that can address these pressing challenges. Rather than focus on pest and weed management that often require more chemicals to improve yield, the technology increases plants’ intrinsic photosynthetic capacity. PhotoSeed plants can harvest more sunlight, fix more carbon dioxide and do so with less water. For growers, this means better seed and grain yield with forecasted yield improvements by as much as 20 percent.
“We need to rethink the way we feed and fuel the world. The problems of population growth, increasing climatic volatility and dwindling natural resources are not going away, and farmers around the globe will need new tool sets,” Han Chen, chief executive officer of ZeaKal, said in the release. “As daunting as these problems are, technology can be equally powerful in solving them. Startups such as ZeaKal are leading the next innovation wave. Our mission is not just agricultural productivity for this year. We aim to build a photosynthetic future to sustainably feed the world for generations to come.”
For ZeaKal, improving efficiency does not end at the lab or field. It carries through to the boardroom. The company is charting a new course for biotech startups with its capital-light, public-private partnership business model. The science behind PhotoSeed was first conceived in collaboration with research funded by the New Zealand government. As the science matured, ZeaKal migrated the program to the University of Missouri to further augment its access to world-class talent, research infrastructure and expertise.
“Investments in agriculture biotechnology have been limited largely by investor misconceptions that it takes hundreds of millions of dollars to build a successful company,” added Chen. “While this may have been true 15 or 20 years ago, the rapidly dropping cost of computing and biotech tools has created a new paradigm for innovation — and, therefore, investments. Biotech is experiencing the same trends that software did, and these trends will carry over to agriculture.”
Arama Kukutai, managing director of Finistere Ventures, Scott Horner, managing director of Middleland Capital, and Bryan Wilson, former president of United Agri Products, will be joining the ZeaKal board. Amy Curran will also be joining the company as the new chief operating officer.