An Australian startup using microbial technology to extend how long carbon can be stored in agricultural soil has secured $105 million in a Series B round co-led by Lowercarbon Capital and Wollemi Capital.
Loam Bio’s raise was also backed by Horizons Ventures, Acre Venture partners, Main Sequence, Grok Ventures and the Clean Energy Finance Corporation (CEFC) – a government-owned green bank that committed $9 million to the round.
Founded in 2019 by Guy Hudson, Tegan Nock, Mick Wettenhall and Guy Webb, Loam Bio has developed a microbial seed coating that is able to enhance a plant’s natural ability to store carbon in the soil.
After years of research and on-farm trials, the technology has been designed to increase the amount of CO2 stored within micro-aggregates – a structure in soil comprising of mineral, organic and biotic materials – for the long term.
The raise brings Loam Bio’s total funding to date to $150 million.
“The reality is carbon has been slowly declining in cropping soil globally, to around 60 per cent since the start of industrial agriculture. Loam now provides a solution to reverse that,” Webb said.
“This year we’re moving from pre-commercial to commercial and launching our products in Australia, working with a limited number of farmers to help them gain value from our products and services in Australia,” Hudson added.
“We're moving towards commercialisation in the US, which will come in 2024, followed by our expansion into Brazil to help farmers globally access value from carbon markets.”
The raise coincides with news that the company has locally rolled out its CarbonBuilder seed inoculum, which works from the root of a canola crop to draw down carbon from the atmosphere and store it stably within soil.
Loam co-founder Tegan Nock said she was excited to commercially launch the technology and get it into the hands of farmers.
“Loam’s CarbonBuilder is the first of its kind. A simple product that farmers can apply in the agricultural system enabling them to capture CO2 from the atmosphere and store it stably in soil,” Nock said.
“There’s not been a technology like it in the marketplace before, and it presents a unique value proposition for farmers.”
Formerly known as Soil Carbon Company, Loam Bio raised $40 million more than a year ago with backing from Shopify founder Tobi Lütke and TIME Ventures - a venture capital fund run by Salesforce CEO and founder Marc Benioff, as well as existing investors Grok Ventures, the CEFC and Main Sequence.
The company is currently partnering with farmers for its SecondCorp carbon projects – an incentive that allows clients to onboard with greater support and flexibility.
“Providing farmers with more transparent carbon projects options and new technologies will enable the greatest agronomic and climate outcomes,” Webb said.
“Carbon is the only commodity that you get paid for, that doesn’t leave the farm gate. The carbon stays in the soil and continues to benefit your faming practise.”
Loam Bio has dozens of staff working across four laboratories in Australia and the US.
“Soil carbon capture is both a climate imperative as well as a huge financial opportunity for both farmers and investors,” Wollemi Capital co-founder Paul Hunyor said.
“Wollemi, a global climate investment specialist, is excited to support Loam’s pioneering work.”
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