September 20, 2019

By Michelle Pelletier Marshall

Agtech innovations are booming, and there is plenty of capital to fuel the sector, with $6.7 billion invested in the last five years, and an estimated nearly $2 billion invested in 2018 alone. Those in certain subsectors – crop protection and inputs management – are more highly invested than others, which bodes well for newcomer on the scene: AgroSpheres. This Charlottesville, Virginia-based agricultural technology company, which has developed a novel delivery system for crop protection products, last month announced a raise of $4 million in a Series A financing round.

Founded in 2016 by COO Payam Pourtaheri and CTO Ameer Shakeel, AgroSpheres’ mission is to dramatically improve the delivery of pesticides, making them more effective, cheaper, and more environmentally-friendly.

GAI News got the chance to speak to Pourtaheri, a graduate of the University of Virginia with a background in nanomedicine, materials science, and chemistry, who is managing the day-to-day operations of the startup company and its eight employees, along with supporting both the technical and business development of the company.

1.) Tell us how AgroSpheres got its start, and how the focus on agtech developed.

Ameer and I met as undergraduates at the University of Virginia; I was going into my senior year, while he was entering his junior year. We both planned to apply to medical school, so we wanted to get involved with research to bolster our applications. In our literature review around drug discovery, we came across a really interesting bioparticle technology, now coined the AgriCell, and approached Dr. Mark Kester to see if we could use this technology for pharmaceutical applications. Due to the significant time and capital investment required for developing therapeutics, we ultimately decided to find another problem that the AgriCell could address. After reviewing some World Health Organization reports, we learned about the significant health concerns associated with the usage of chemical pesticides, especially in developing countries.

We became passionate about developing environmentally-friendly solutions for current pesticide usage, starting with pesticide remediation. Ameer and I prototyped the AgriCell to deliver sophisticated pesticide-degrading enzymes that targeted the Organophosphate class and tested the prototype at local vineyards and an orchard. We were able to successfully degrade Malathion, a widely-used, harmful organophosphate pesticide, within a few hours. We competed in and won many pitch competitions, bringing in over $120,000, all of which was used to further develop the platform. However, the market feedback we received as students doing research differed from the market feedback we received as a company with a product in development. Once it came time to market our pesticide-degradation product, we learned that the product might pose an inconvenience to farmers. It would be costly and time-consuming to implement an additional spray, and farmers were technically meeting regulatory standards without it. Through further research and customer discovery, we learned from both farmers and pesticide companies that the true need in the field is for better delivery technologies to improve synthetic chemical applications and enable biological pesticide applications. This pivot provided us with the opportunity to develop a practical, valuable solution that would minimize the negative impact of chemical pesticide usage.

Upon graduation, we decided against attending medical school and formed AgroSpheres to commercialize the AgriCell technology. Once AgroSpheres was established, we raised a $750,000 seed round, hired a team of talented UVA scientists and set up the laboratory. We recruited an experienced CEO, Doug Eisner, to join the AgroSpheres team in August 2018. Previously, Doug was the COO and co-founder of GrassRoots Biotechnology, an agricultural biotechnology company that spun out of Duke University and was eventually acquired by Monsanto. To date, we have raised over $5 million in investments from experienced investors such as Ospraie Ag Science and Cavallo Ventures (the venture arm of Wilbur-Ellis), and $1 million in grants from institutions such as the National Science Foundation and Virginia Catalyst.

2.) Your core technology is the AgriCell. What are its applications, and have field trials been completed?

The AgriCell technology is a non-GMO bioparticle (approximately 400 nanometers), produced during the fermentation of bacterial cells, which can be loaded with synthetic chemicals and biologicals. It can protect the encapsulated active ingredients from extreme temperatures, pHs. and environmental degradation. The AgriCell has the ability to control the release of the active ingredient and embed proteins on its membrane surface for improved targeting. Our transformative technology can be used to significantly improve the delivery efficiency of synthetic pesticides and enable the efficacious and scalable delivery of biological pesticides. The improvements provided by the AgriCell technology will reduce the environmental footprint of chemical pesticides and provide safer work environments for hardworking farmers.

To bring these products to the market, we have initiated strategic collaborations with industry and academic leaders such as ADAMA, Virginia Tech, and NC State University. The current products in our biopesticide pipeline target Botrytis Bunch Rot, Fall Armyworm, Thrips, and Asian Soybean Rust. We believe that the best path to commercialization entails a dual-pronged approach in which we partner with industry leaders and develop our own pipeline of products in parallel. We completed our first round of field trials last summer and are continuously optimizing additional prototypes through greenhouse testing at IALR (Institute for Advanced Learning and Research) in Danville, Virginia.

3.) You just raised $4 million in a Series A financing round, lead by Ospraie Ag Science with Wilbur-Ellis. How will this funding be used?

To sustain our rapid growth, we will be using our recent funding to invest heavily in R&D. Obtaining proof-of-concept field data and minimizing cost of goods (COG) are the major focuses of our R&D efforts. To drive these research efforts, we intend to add expertise in the fields of fermentation, molecular biology, and plant pathology to our team. We will be purchasing sophisticated laboratory equipment and doubling our lab space in Charlottesville, Virginia, to increase discovery and manufacturing efforts. IP protection is key to our value; therefore, funds will be used to globally expand the protection of our core patents. We also plan to use our funds to recruit regulatory consultants to aid in registering the AgriCell platform with the EPA and FDA. With the addition of the expertise of our Series A investors and their injection of capital, we are well-poised to accelerate towards our commercialization goals. 

4.) What are the benefits of your technology over competitors?

The AgriCell is a sophisticated AND scalable delivery technology. Normally, the more features of a delivery technology, the more expensive it is to scale. The production of the AgriCell occurs in the fermentation tank; the bacteria do all the work for us. While most delivery technologies may work with synthetics or biologicals alone, our technology is compatible with both. Another key feature is the biomolecule production aspect of the technology. We can utilize the bacteria to synthesize biomolecules such as double-stranded RNA and anti-fungal peptides during the fermentation process, prior to inducing the production of the AgriCell. This method allows for a single-step synthesis and encapsulation process that provides us with a significant COG advantage. Our technology can become the premier biodegradable, cost-effective delivery technology for crop protection. We are encouraged by the market feedback and are excited about the prospect of using our technology to make crop protection more effective and environmentally-friendly.

5.) What’s next for AgroSpheres?

AgroSpheres aims to become a leader in the crop protection industry. The AgriCell technology will be rigorously tested in greenhouse and field settings to further validate its ability to significantly improve the delivery and stability of both synthetic and biological pesticides. We intend to fully delineate our regulatory pathway and secure the IP protection of our core technology, as well as file additional applications on the products created from the platform. Finally, we will expand our operations in Charlottesville with the addition of employees and lab space to develop the AgriCell technology to its greatest potential.

-Michelle Pelletier Marshall is managing editor for Global AgInvesting’s quarterly GAI Gazette magazine and a regular contributor to GAI News. She can be reached at mmarshall@globalaginvesting.com.