Universities in the US are integrating agriculture technology and innovation with the traditional STEM disciplines—science, technology, engineering, and math. And, while many of these universities are pushing agtech in the classroom, Purdue University is also helping finance new and innovative ag technologies.
The Purdue Ag-Celerator is due to launch its second program in March 2017 after recently closing applications for the cohort.
The accelerator is a plant sciences innovation fund operated by Purdue Ventures, the capital access arm of the Purdue Foundry, with assistance from the Purdue College of Agriculture, Purdue Research Foundation’s Office of Technology Commercialization, and the agricultural industry. Launched in December 2015, the Ag-Celerator is a $2 million fund supported through the Purdue Moves initiative designed to provide financial support for Purdue innovators wishing to commercialize patented intellectual property or Purdue technologies in plant sciences, including areas of research in crop optimization, hybrid and seed development, and precision agriculture.
Startups that participate in the Ag-Celerator will undergo six weeks of ideation validation training and pitch their company to the Ag-Celerator Selection Committee. Winning companies will receive an investment of up to $100,000 per semester on a competitive basis, with the amount of investment determined according to each companies’ request and the selection committee’s decision.
Making it to the final pitch round of Ag-Celerator is also competitive, says John Hanak, managing director of Purdue Ventures.
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“The company has to be far enough along in the process, or positioned to create a company. After the threshold review, we take them through an entire semester-long process including an ideation phase. If they have been around a bit longer, we will verify that they have been through some equivalent ideation process,” Hanak recently told AgFunderNews.
Thinking about the 9 companies who made it to Ag-Celerator’s recent pitch day, Hanak sees some common strengths.
“The strength of the team, potential for ROI, size of the market they are addressing, and potential to create a return for the Ag-Celerator,” he says. “We believe we can turn this program into an evergreen fund and sustain it for the long-term.”
At the beginning of January 2017, the Ag-Celerator awarded funding to two startups from its first cohort.
“We had 16 applications for the first cohort. We felt this was a very strong number and those technologies ran the gamut, including everything from tech that supported the actual growth of plants to soil testing to RFID technologies that are integrated into pot plugs.”
The Demo Day selection committee included a variety of agriculture industry professionals and investment gurus, including representatives from AgriNovus, Indiana’s food and agriculture innovation economic development initiative focused on advancing the sector, AgAlumni Seed, a hybrid popcorn seed export and breeding company, and Cultivian Sandbox Ventures, a venture capital firm focused on building next-generation food and agriculture technology companies.
Phicrobe, a startup commercializing an innovative method for the inexpensive and rapid detection of pathogenic E. coli in food and food product environments, received $75,000 in funding.
For Bruce Applegate, founder of Phicrobe and associate professor of food science at Purdue, the experience was valuable regardless of the outcome.
“Although we were successful in obtaining funds, the exposure that came from our success has resulted in numerous opportunities for collaborative efforts,” he told AgFunderNews.
The most challenging aspect of the program for him was condensing Phicrobe’s technology and route to commercialization into a 10-minute pitch. But Applegate urges all startups to figure out how to convey information about their production costs and marketability in a succinct format.
Hydro Grow, a startup developing a refrigerator-sized automated device to grow vegetables in consumers’ homes, received $25,000.
For Scott Massey, founder of Hydro Grow and a senior in Purdue’s Polytechnic Institute, the collegiality of the program and being surrounded by like-minded scientists, academics, and professionals was just as rewarding as the investment.
“The feedback from everyone involved in the program has proven to be the most valuable,” he tells AgFunderNews. “The feedback is constantly incorporated into product development and my business plan.”
As for the technologies that excite him, Hanak is keen on hydroponics, big data, soil, and atmospheric monitoring.
“What I find really exciting is that we have a global issue relative to the number of mouths that have to be fed in the coming decades,” he explains. “It will be technology that creates the solutions to that.”
And when it comes to the future of the Ag-Celerator, Hanak and the program are betting on the long game.
“In 10 years, I would like to see some returns and monetization of our investments such that we are able to grow the funds and continue to pay it forward. So that we could continue investing in startups and commercializing Purdue IP.”