Front Range Biosciences (FRB), a leading agricultural biotech firm specializing in tissue culture propagation of high value crops including cannabis, announced it has closed on $10 million Series A funding. The round was backed by a field of investors including Phyto Partners, WelCan Capital, Salveo Capital, Cornerstone Opportunity Partners, Sand Hill Angels, Harvard Business School Alumni Angels of New York, New York Angels, Altitude Investment Management, and other new and returning investors. This round reflects the largest funding raised by a U.S. cannabis biotech company to date.
Founded in Lafayette, Colorado, FRB focuses on tissue culture propagation of crops at industrial scale to create efficiency and to lift quality consistency for clone production. Through this process, FRB propagates seedlings through cloning on a “nutrient culture medium of known composition”. By doing so, FRB eliminates numerous operational challenges faced by cannabis and other crop cultivators including disease, lack of consistency, and inability to achieve scale.
When considering the hemp and legal cannabis sectors, traditional propagation methods suited the industry’s needs while it was in its very early stages, however, as the sector matures and demand intensifies, operators are increasingly looking to integrate tech and scientific methodologies to strengthen and regulate the supply chain. The company also employs Next Generation Sequencing technology with their varietal improvement program to create a map of cannabis genetics. This service enables producers to target and develop the most commercially applicable and desired cannabis traits in their stock, including disease resistance, oil and resin yield.
“FRB has a proven track record of developing a unique platform to improve yield and quality within crops, particularly in the emerging hemp and marijuana space,” said Michael Gruber, managing partner at Salveo Capital. “We are thrilled to have the opportunity to invest in and partner with an innovative and disruptive company that we believe has tremendous growth potential. We look forward to working collaboratively with the entire FRB team to help promote significant value creation in the business.”
This round follows one year after FRB announced its successful raising of $3 million in bridge round funding from a group of investors including Phyto Partners, Salveo Capital, Sand Hill Angels, HBS Angels of NYC, Halley Venture Partners, Anthill Ventures, and Canopy Boulder.
With the support of this funding, in March of this year, the company partnered with Frinj Coffee to supply Clean Stock coffee rooting cuttings to farmers across Central and Southern California; and in June FRB expanded its cannabis Clean Stock production through a partnership with family-owned cannabis cultivation facility, Faith and Family Farms in Salinas Valley, California which is currently taking orders for late 2018 production.
The company noted that the capital raised through this Series A will support the acceleration of its Clean Stock program in California, Colorado, and Canada, and also will be used to fund IP development and resourcing its varietal development program for hemp and cannabis.
“As cannabis and hemp legalization spreads throughout the United States and internationally, there is an increase in demand for clean, quality crops — this capital will also enable us to expand our capacity to meet a small portion of that demand,” said Dr. Jonathan Vaught, CEO and co-founder of FRB. “We appreciate the support from our early investors and are pleased to welcome new investors to the family as we execute on our mission to provide growers with a wide variety of disease-free and true-to-type plant stock.”
“The industry is losing its taint as a drug industry and is becoming a much more sophisticated market,” Scott Greiper, president of Viridian Capital Advisors, a firm that tracks the industry, told Fortune in July 2016.
The advancement of cultivation systems and supply chain technologies, as well as research and development into new strains that could aid in the treatment of various health ailments, are providing more credibility to the market and capturing the attention of seasoned investors, Greiper told Fortune.
“We are impressed with FRB’s ability to scale their business and solve a key problem in the industry. This latest round of funding demonstrates their capacity to attract capital from institutionally trained and sophisticated investors,” said Vikas Desai, partner at WelCan Capital. “FRB is a prime example of a cannabis company with a deep, experienced management team and a true institutional caliber operation, with many similarities to a traditional biotech company.”
-Lynda Kiernan