Radicle Growth, Land O'Lakes and Cooperatives Partner to Create Ag Rogue Growth Partners: A Platform for End to End Innovation

Index

1. Overview

2. Platform Not Corporate Venture Capital

3. Pillars of Focus

4. Why Now and The Deployment Phase

5. What Does Success Look Like? Confidence

6. Final Thoughts: Does Land O’Lakes Have Innovation Capabilities?

Land O’Lakes, Inc. and Local Ag Retailers Announce Participation in AgRogue Growth Partners to Find, Fund and Scale New Ag Technologies - Land O’Lakes

Overview

One of the things I have advocated for is ag retailers developing relationships with VCs— retails can access knowledge on new companies and emerging trends, and the VC can gain market access (for portfolio companies), awareness of emerging problems and trialling infrastructure as a few examples. This new collaboration takes things a step further and aligns incentives across the VC, distributor and retail.

AgRogue Growth Partners, enabled by Radicle Growth VC is leveraging upwards of $100 million of capital to invest into 10-15 companies over a ~6 year period from not only Land O’Lakes (LOL), but also the participating cooperatives:

• Keystone Cooperative

• Central Valley Ag

• Farmers Cooperative

• Farmward Cooperative

• Alabama Farmers Cooperative

• GreenPoint Ag

The fact there are cooperatives directly investing into the initiatives creates more “skin in the game” for the retail participants to be engaged in supporting the companies identified and invested in.

That more direct association is one differentiator of the AgRogue Growth Partners initiative compared to what CHS and GROWMARK have done with Cooperative Ventures— a more traditional Corporate Venture Capital (CVC) type of initiative.

It’s not clear how many of the four investments have gained meaningful traction via GROWMARK or CHS market access, but there is one ag retail example from venture investing that illustrates the potential of aligning innovation with market access:

Cavallo Ventures (Wilbur Ellis CVC) investing in Agrospheres and then announcing an exclusive distribution agreement through Wilbur Ellis for their first commercial product.

Platform Not Corporate Venture Capital

In my conversation with Kirk Haney of Radicle Growth, along with Brett Bruggeman (COO) and Jason Trusley (CSO) of LOL, the emphasis was that the initiative is not traditional VC, but building a “platform”.

That platform combines unique competencies across Radicle Growth, Land O’Lakes, and the cooperative participants: the ability to identify problems, source deals, vet leading founders/teams, build and scale companies, along with engage the channel and deliver market access.

The nuance is in not only the incentive structure and capabilities alluded to earlier, but the flexibility this brings forth for deploying capital. For example (not something they explicitly stated to me as an aim, just an example I am using), if there is a specific problem identified and there is no company that can solve it the team at Radicle Growth can leverage their network to found a company and source the technology that can help deliver a solution into the market.

Pillars of Focus

The effort comes across as flexible, meaning there are opportunities to invest and find companies across many different areas or problem sets.

Jason Trusley of LOL did share four aims:

1. Increasing Farmer Income

2. Enhancing Quality (of grains)

3. Strengthen Soil Health

4. Improve Retail Success

Within those areas of focus they want to explore:

1. crop inputs including the likes of crop protection, nutrition, surfactants/surfactants, and biostimulants).

2. digitization which can include things like sensors and automation/robotics

3. business model evolution and looking at new avenues like carbon programs or biofuels.

The focus gives them a broad swath to go after and keeps many opportunities on the table.

Why Now and The Deployment Phase

One of my questions for LOL was “why now?” After all, innovation has been important for years and farmers have been overwhelmed by technology, while retailers have been capable of delivering market access and trusted resources at the same time.

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