DCVC, Temasek lead $430m funding round in biofertilizer startup Pivot Bio

Source: Markus Winkler/Unsplash

A startup born in the lab of University of California, Berkeley, is aiming to replace synthetic fertilizers that contribute to greenhouse gases and so-called ‘dead zones’ in the ocean.

Pivot Bio‘s products use microbes to create and feed nitrogen to corn and wheat crops. It said on Monday it has raised $430 million in a funding round led by Silicon Valley venture capital firm DCVC and Singapore’s Temasek Holdings, bringing total funding to $600 million.

The company’s valuation is now near $2 billion.

“Our pitch to growers today is, instead of spending a dollar on nitrogen fertilizer, spend a dollar on Pivot‘s nitrogen,” said Karsten Temme, Pivot Bio‘s co-founder and CEO about how their products are already cost competitive.

He said that while synthetic fertilizers have to be separately applied during the growth of the crop, adding to extra labor costs, Pivot‘s liquid product is applied with the seed at the time of planting and the microbes do the work from there.

That’s helped Pivot triple its sales this year, with U.S. corn and wheat farmers using it on millions of acres of fields, said Temme. He declined to give the exact number of acres covered but said this year the acreage was four times larger than last year.

Pivot Bio says its products take microbes that naturally occur in crop soils and use them to convert atmospheric nitrogen into ammonia and feed it to plants, a process that synthetic nitrogen has shut off.

What makes identifying that microbe possible today is cheaper, faster computing power, said Matt Ocko, Co-Managing Partner of DCVC, which was one of the first investors in Pivot Bio. “We don’t fund raw science bubbling away on a bench top. We need to see the commercialization path,” said Ocko, who has several other deep tech investments that have also been made possible with computing developments.

While synthetic nitrogen was also a breakthrough in science and a profitable business when it was developed over a century ago, it came at a cost to the water, air, and soil, said Ocko.

According to the International Fertilizer Association’s 2017 report, about half of the world’s synthetic nitrogen is used for fertilizing corn, wheat and rice, a roughly $60 billion market. Pivot is developing a fertilizer product for rice as well.

Crunching numbers from a U.S. Environmental Protection Agency report, Pivot Bio says 7% of greenhouse gases are produced by synthetic nitrogen fertilizer, when considering manufacturing and nitrous oxide emissions from the fertilizers on the farm. Its run-offs have also harmed water supplies.

The new funding will help Pivot Bio expand to other countries as well as continue to improve the efficiency of the liquid microbe products, said Temme.

Reuters

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.