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‘No comment’ from Indigo Ag on valuation nose-dive report

August 31, 2023

  • Indigo Ag would not comment on reports that its valuation has plummeted 94% from $3.5 billion two years ago to just $200 million today.
  • Israeli publication CTech cited reports from Israel-based Unic-Tech partnership, which invests in tech unicorns; CTech claims Indigo Ag raised new funding last month at a valuation of around $200 million.
  • AgFunderNews has reached out to Unic-Tech and will update this post with new information as it arises.
Image credit: iStock

What the report says

CTech did not disclose an amount for the reported latest funding round from last month, noting only that Unic-Tech invested in Indigo Ag “despite registering a loss of around $420,000 on its investments in the company to date.”

Quoting Unic-Tech, CTech reports that Indigo Ag “had been prepared for an IPO” and recently raised $160 million “at a significantly higher value than the partnership’s initial share purchase.”

Unic-Tech continues: “With an IPO off the table, the company underwent a reorganization. The [Unic-Tech] partnership acted conservatively and adjusted the valuation.”

Indigo Ag declined to comment when contacted by AgFunderNews for this article, including on whether or not the company is currently fundraising.

A narrowed focus

Indigo Ag started out working with plant microbes to improve the yields of staple crops such as cotton, corn, wheat and soybeans. It later expanded its business lines to offer crop marketing, storage and logistics programs to farmers and later to create a carbon credits program, Carbon by Indigo.

Some feel this rather wide-reaching array of businesses (Indigo Ag itself once described the company as “five startups in one place”) has led to confusion about what the company actually does and where its key value lies.

However,  the company has narrowed its focus more recently. In 2021 it reorganized as part of a strategy to direct resources to its grain marketing and transportation platforms, as well as its carbon credits scheme and biological products business.

To that end, developments of late have focused largely on those areas.

Earlier this year, the company launched its FieldFlex program to help farmers choose carbon credit and sustainable farming programs best suited to their own needs and crops. (Most in the industry these days agree one-size-fits-all sustainability doesn’t work.)

This month, Indigo Ag launched a new bionematicide for the US market to fight soybean cyst nematode.

And in July, the company teamed up with Consolidated Grain and Barge Co to measure emissions on CGB’s grain production using Indigo’s proprietary measurement, reporting, and verification (MRV) technology.

A recent peer-reviewed paper from soil science journal Geoderma used the DayCent model for carbon offset calculations for a range of crops and soil management practices in Indigo Ag’s carbon credit projects. According to the paper, the model demonstrated “unbiased predictions and adequate prediction interval coverage rates” and has big implications for boosting the integrity of carbon credits.

No billion-dollar outcomes yet in agtech

Despite progress outlined above, the agtech community had much to say about the contents of the recent CTech article, which is hardly surprising, given the current economic climate.

“[Indigo Ag] raised a tremendous amount of money and set very high expectations in an industry of slow adopters, and one that’s still in its infancy and hasn’t produced many billion dollar outcomes yet,” AgFunder founding partner Rob Leclerc told AgFunderNews. [Disclosure: AgFunder is the parent company of AgFunderNews.]

“As we are seeing across the VC landscape, the market has shifted,” added Leclerc. “Wild-eyed ambitions will only be tolerated so long and there must be a greater focus on near term profitability over growth at all costs.”

Ag industry vet and Upstream Ag Insights boss Shane Thomas believes a changing valuation for Indigo Ag has implications beyond just the current economic climate in tech.

“This is a trend beyond the macroeconomics environment,” he told AgFunderNews. “It is investors acknowledging that many of these agtech companies are not ‘tech’ companies, they are simply ‘tech enabled,’ which has a very different multiple of dynamics such as margins and marginal cost structure.”

Indigo Ag reached so-called ‘unicorn’ status in 2017 after a Series D raise. It was one of the highest-funded agrifoodtech startups in 2020, raising a total of $560 million.

The company acquired Soil Metrics, a firm which carries out assessments of soil carbon sequestration, for an undisclosed sum in 2021 to boost its carbon MRV capabilities.

In 2023, the company has made two rounds of layoffs. Whether that’s due to macroeconomic factors or pain points specific to Indigo is unclear at this time.

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