Bet on the Jockey

Featured in the December issue of our magazine.

By Barb Baylor Anderson

When venture capitalist Roger Wyse considered investing in ag technology startup Pivot Bio’s nitrogen-producing microbes four years ago, he was confident it was a solid decision.

“When selecting projects, we look at the team. Do they have the research insight and market foresight to bring their product to commercialization? You bet on the jockey,” says Wyse, co-founder of the San Francisco-based Spruce Capital Partners, LLC.

“Next, we look at the technology and the intellectual property potential and whether it addresses a large market need,” he continues. “There are so many small companies entering agriculture. The winners will start to sort themselves out, and investors will invest in the right ones.

”Wyse has been funding promising ag innovations since 1998,long before it was a trend. A plant biologist by trade, he served in academic leadership roles during the 1980s and 1990s before becoming a venture capitalist. Wyse was introduced to Pivot Bio(pivotbio.com) through a Monsanto Growth Ventures contact. His business partner, Ganesh Kishore, worked at Monsanto.

“When we funded our first venture, we had a hard time finding syndicates. Now, with the huge emergence of technology, artificial intelligence, machine learning, big data, imagery and more, there is a much bigger space for venture capital in ag,” he says. “We study the science and the approach and choose projects we think will be truly disruptive in the marketplace.”

Pivot Bio met Wyse’s criteria. The company’s renewable,sustainable nitrogen concept feeds corn crops cost efficiently and with less of an environmental footprint.“We take nitrogen-producing corn microbes and challenge them to reawaken what has gone dormant through traditional nitrogen fertilizer use,” says Karsten Temme, CEO and co-founder of Pivot Bio. “PROVEN is a reliable and clean alternative to synthetic nitrogen use in corn.”Founded in 2011 with funds from the Bill & Melinda Gates Foundation, Temme and co-founder Alvin Tamsir had a plan to create a transgenic corn plant that would make its own nitrogen.After realizing the product would take decades of work to reach the point of commercialization, they shifted their business plan to nitrogen-producing microbes and added more investors.

Small Companies

DCVC (Data Collective) led seed financing in 2014 and Series A round in 2016. Other major investors have included Monsanto Growth Ventures, Spruce Capital Partners and Prelude Ventures.Series B funding was announced in October, led by Breakthrough Energy Partners, and included support from existing and new investors like Temasek and Roger Underwood.“

The $70 million in Series B funding will help us bring the product to market. We are selling product now for spring 2019planting,” says Temme. “We now have a foundation for additional research and development and commercial growth.”

Temme believes venture capitalists are attracted to agriculture because they inherently look to solve problems. He sees such investments as the way to bring more technology to more acres.

“The challenge is how to sift through what is noise and what isn’t.It is all about making life better for farmers, to be sustainable andto shrink the environmental footprint,” says Temme. “Pivot Bio offers a new set of tools that makes corn production easier andmore resilient.”

Wyse agrees. “Pivot Bio is different because the microbes reduce corn production input costs by replacing traditional fertilizer costs,” he says. “The Pivot Bio team has scientifically demonstrated value and now they are working with innovative farmers to evaluate the microbes and build their reputation and credibility.That bodes well for farmer acceptance.”