Finistere Leads $5.3M Series B for Ag Biotech Startup, ZeaKal

February 18, 2016

San Diego-based ag biotech startup, ZeaKal, announced it has raised an oversubscribed $5.3 million Series B led by Finistere Ventures and including Middleland Capital and multiple family office investors. ZeaKal is seeking to increase agricultural output through the integration of its PhotoSeed™ technology. Plants typically are able to convert sunlight to biomass at levels between 2% to 3%, but if affected by environmental stressors, particularly high temperatures, this conversion rate falls even lower.

 

"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," said Han Chen, CEO of ZeaKal in a company statement.

 

In response, PhotoSeed™ is able to increase plants’ photosynthetic capabilities – allowing them to harvest more sunlight and fix more carbon dioxide while using less water. This increased capacity can result in an improvement in grain and seed yields of up to 20%.

 

"The need for innovation in the farming and food sector is important not only for farmers and consumers, but also for AgTech itself," said Arama Kukutai, Partner, Finistere Ventures. "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."

 

ZeaKal is not only pushing innovation in food production, but in its biotech business structure as well, with its ‘capital-light, public-private partnership business model’. The scientific groundwork behind PhotoSeed™ was initially developed in collaboration with research funded by the government of New Zealand. As the technology matured, ZeaKal brought the project to the University of Missouri, where with greater access to expertise and research infrastructure, the technology was able to be further scaled and developed.

 

"Investments in agriculture biotechnology have been limited largely by investor misconceptions that it takes hundreds of millions of dollars to build a successful company," said 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."

 

The firm plans to use the funds raised through this round to expand its PhotoSeed™ development pipeline and bring its first soybean product to field trials by May of this year.

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