Investment Corporation of Dubai-led financing is one of the largest single investments into a private agriculture-technology company
Dubai leads $47m additional investment into US farm tech firm
The farming technology start-up Indigo announced on Wednesday an additional US$47 million investment led by the Investment Corporation of Dubai, a state-owned sovereign wealth fund, bringing Indigo's latest financing round to $203m.
The Boston-based company is valued after the latest round at $1.4 billion, said Indigo's president and chief executive David Perry.
The financing is one of the largest single investments into a private agriculture-technology company. It rivals SoftBank Group's investment into Plenty, a start-up working on new technology to grow crops indoors, announced in July. That investment, from SoftBank's Vision Fund, was $200m.
Mr Perry said Indigo will use the funding to open or expand new offices in Australia, Argentina and Brazil and continue to invest in research. The company raised $100m last year, and has raised more than $400m since its founding in 2014.
Indigo hired JPMorgan Chase & Co to facilitate the deal, Mr Perry said.
The start-up says it is working to create a new way to grow crops so they are more resistant to insects, drought, severe weather and nutrient-poor soil. The company says its formula of coating seeds in microbes will one day help crops to withstand environmental stresses and allow farmers to forgo chemical fertilizers, herbicides and insecticides.
"There is an enormous initiative to grow crops differently" and "in a more sustainable way," Mr Perry said.
Indigo's business is a work in progress and far from proven. Mr Perry said most farmers that use Indigo technology still also use fertilizers and chemicals on their plants. The company works with farmers in the US, Argentina and Australia.
Indigo contracts with farmers before their growing season begins and sells the crops at a premium, Mr Perry said. For instance, Indigo sells its wheat to millers and brewers, and the wheat farmer earns about 15 per cent more from the sale than average commodity prices.