January 6, 2020

By Lynda Kiernan

Microbial science-focused agtech giant Indigo Ag announced the raising of another $200 million, comprised of $175 million in convertible equity, and $25 million in debt. 

This most recent funding round includes new investor FedEx, new lender Pacific Western Bank, and existing investors, and brings the total capital raised by the company to-date to $850 million.

Indigo, which was originally created within Flagship’s in-house incubator VentureLabs, uses natural microbiology and digital technologies to improve grower profitability, environmental sustainability, and consumer health.

This capital is being earmarked to drive the global development for two of Indigo’s platforms – Indigo Grain Marketplace, an e-commerce platform for direct grain transactions; and Indigo Carbon, a market offering farmers financial incentive to sequester carbon and improve their soil while fighting climate change through regenerative farming practices.

As the company’s funding continues to grow, it is evolving and expanding beyond its work developing microbial products that increase crop yields, to add services that will see it become a full-service digital platform for farmers. Since the company’s last funding round in September 2018 when Indigo raised a $250 million Series E, the company has launched multiple digital platforms to generate new value along entire supply chains. 

In September 2018 the company launched Indigo Grain Marketplace – a digital platform designed to connect farmers directly to buyers, allowing them to transact for commodity crops at no cost. Buyers also are able to source grain with specific factors in mind, such as protein content, variety, milling quality, organic, non-GMO, or rain-fed, and in turn, farmers will be able to price their grain based on its identifying factors of their crop and how it was produced. Furthermore, Indigo facilitates grain quality testing, transportation, and payment through the platform.

Since its launch, $300 million worth of bids have been placed through the Marketplace, and during the second half of 2019, the platform saw month-over-month transaction growth of between 50 and 100 percent. 

The second platform to benefit from this round is Indigo Carbon – part of The Terraton Initiative, a project launched by Indigo in June 2019 with the goal of drawing down one trillion tons of carbon dioxide while improving soil health, and combating climate change. 

Using technological solutions that measure, monitor, and verify accurate soil carbon content, Indigo Carbon offers farmers financial incentives for increasing soil carbon concentration through regenerative farming practices – the most scalable, immediate, and affordable way to address climate change, according to the company. And since its launch, the initiative has seen growers representing 14 million acres, reflecting interest in participating in the program.

“In the past year, Indigo has seen continued growth across all of its business lines, from Grain Marketplace to Carbon to Transport,” said David Perry, CEO, Indigo. “With over 10,000 growers and nearly half of all buyer facilities in the U.S. enrolled in Grain Marketplace, we are seeing a shift towards the use of technology to create a de-commoditized market.”

“Indigo and The Terraton Initiative offer promising solutions to address climate change,” said Frederick W. Smith, chairman, FedEx. “The sustainability of our environment is a strategic focus area for FedEx, and we look forward to supporting Indigo’s efforts to transform agriculture into a scalable, affordable, and immediate approach to reducing atmospheric carbon dioxide.”

The growth that these platforms are experiencing and the capital investment they have attracted will see them be a focus for Indigo as we enter a new year, according to Indigo CEO David Perry, who said, “In 2020, Indigo intends to focus its efforts on the marketplace businesses that are experiencing exponential growth, with a goal of generating positive operating cash flow near the end of the year and for the full year 2021.”

– Lynda Kiernan is Editor with GAI Media and daily contributor to the GAI News and Agtech Intel platforms. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.com.