Capagro Innovation Finalizes Second Funding Round; Doubles in Size
October 20, 2017
Capagro Innovation, the first French fund dedicated to investing in agriculture, food, agronomy, and nutrition, announced a second and final close for its Capagro Innovation Fund. The fund raised another €66 million (US$77.8 million) – doubling the fund’s corpus to €124m (US$147m) and surpassing its original funding goal of €120 million (US$141 million).
This funding round follows the fund’s first subscription round, which closed in January 2016, and adds new investors, Agromousquetaires, ISAGRI, InVivo, and LSDH to its list of existing investors that includes Groupama, Crédit Agricole, and Bpifrance.
“This final funding round represents a turning point for Capagro Innovation: it will enable it to cope with a growing deal flow and improve its capacity to invest in its most promising stakeholdings,” said the company.
The creation of Capagro Innovation was announced in September 2014, endowed with an initial €37 million from five leading industrial groups – Sofiprotéol, Tereos, Bpifrance, Crédit Agricole subsidiary Crédit Agricole Capital Investissement & Finance (CACIF), and AG2R-La Mondiale.
Upon its launch, Capagro Innovation intended to take capital stakes of between €1 million and €5 million (US$1.2 million – US$5.9 million) in approximately 15 French or European companies on the cutting edge of plant proteins, recycling, plant chemistry, or the “exploitation of marine resources”.
The fund made its first investment in July 2014 when it make a €1.5 million investment in LineaZen – a french company that develops high performance cross laminated timber from bamboo or beech. It then went on to make nine investments in a 12-month period throughout 2015 – two of those being French baby food startup, Yooji, and French pea starch producer, Olygose.
To date the fund has examined more than 400 applications from innovative startups in the food, agriculture, and agtech sectors looking to secure investors, and has made investments in 15 companies.
The doubling of its size will allow the fund greater freedom to increase its number of investments to approximately 20, and to increase the size of its investments up to €10 million (US$11.8 million) as demand continues to grow, while also giving it the option to commit to follow-on rounds for its existing portfolio companies.
“Our fund has thus provided itself with the means to respond to the changing capital needs of the start-ups it supports,” explained Jean-Baptiste Cuisinier, chairman of Capagro. “We must be ready to enable these young companies to succeed in advancing from the status of a start-up to that of a firm that has demonstrated its growth potential. This challenge is particularly important because, despite a strong rise in demand, there are very few funds like ours in Europe.”
Cuisinier goes on to note that the development of the agtech sector and a consumer base that is more involved and educated about their food are drivers of the fund’s success.
“The success of this operation wholly validates the initial idea which drove the creation of our fund. The growth of the digital and robotic sciences, advances in biology and biotechnologies, and demands from society regarding agriculture, food and the recycling of biomass, have all converged.”
Looking forward, Capagro states that it aims to use this fund as a vehicle by which to capitalize upon the advantages presented by French agtech developments on global markets. In 2015 the agtech space surpassed the fintech or cleantech sectors for investments, clocking $4.6 billion, up from $2.5 billion the year before, and continues to show signs of growth as the number of investments continued to climb in 2016 by 10 percent.
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