In 2019, venture capitalists (VCs) invested a record $2.8 billion into agtech startups across the globe.
VC investors look to place their bets and invest their money into visionary founders with novel ideas. They’re also looking for companies that have a strong team with passion and drive to achieve goals and objectives. Focus, business acumen, and discipline round out the VCs must-haves.
With the help of a contract development and manufacturing organization (CDMO), an ag startup can supplement its business and organization to improve its chance of success.
Here is how a CDMO can help venture capital-funded agricultural startups grow quickly and succeed.
What Does It Take to Succeed as a Venture Capital-Funded Agriculture Startup?
A venture capital startup needs to have a vision or idea that provides market value. They must have a business model that can compete and facilitate growth. The startup should have an experienced team to support the vision, be cash efficient with their precious resources, and mitigate inherent risks.
Decades of Experience
An ag startup may not have the breadth and depth of team in all functions to provide the experience necessary to succeed. Critical functions and services can be outsourced. Formulation and product development may be such a critical need and shortcoming.
Formulation labs and equipment, analytical equipment, and pilot plant facilities and equipment can cost millions to purchase or build. Plus, they are useless without an experienced team to staff and operate them. Idea and product development can be outsourced to a CDMO such as CJB Applied Technologies.
The CJB Team has many decades of experience in formulating and developing agricultural products. The team has conducted hundreds of projects bringing new products to the market for their customers. CJB knows of and knows how to avoid the pitfalls of the formulation development process that a startup might not be aware of.
The chemists at CJB Applied Technologies have a deep understanding of the chemistry and processes that work in agriculture. They understand the regulatory requirements necessary to get a product made and approved for market. They have the facilities, equipment, skills, and experience to take an idea through the lab, pilot plant, testing, and manufacturing (at scale) process.
A CDMO such as CJB Applied Technologies can dramatically increase the breadth and depth of an ag startup’s research and development (R&D) and product development team.
In the startup world, cash is king.
VCs and entrepreneurs fight tooth and nail to conserve cash and extend runways. All in the hope that another round and dilution can be prevented. Worse is that the cash raise process is the greatest waste of time and talent for a startup. The time and resources are best utilized developing and launching products and services as quickly as possible to get to cash flow breakeven.
Outsourcing formulations development, pilot plant scaleup, and process design to a CDMO can help an ag startup conserve precious cash. The human resources team as well as the facility and equipment are in place. A CDMO such as CJB Applied Technologies can bring the entire package together quickly and efficiently for a startup’s project. The CDMO rent vs. buy model can help an ag startup conserve cash.
The risks inherent in developing an agricultural product are numerous.
Take sourcing, cost, manufacturing, and regulatory risks, for example. That’s all before even getting to the physical, chemical, and biological aspects and risks of an agricultural product. Plants, the soil biome, and growing conditions form an exceptionally diverse set of biological challenges for ag products.
A CDMO such as CJB Applied Technologies recognizes and understands these risks. They have helped customers manage them in hundreds of formulations and product development projects.
The development process starts with a detailing of the physical, chemical, and biological attributes wanted in the product. It culminates in a formulation and product owned by the customer that, when risks are managed, performs as desired.
How A CDMO Helps Venture Capital-Funded Agriculture Startups
Now you know how a CDMO can help improve the chance of success of VC-funded ag startups.
By working with a CDMO, an ag startup can outsource work efficiently, take advantage of decades of experience, and help mitigate the risks involved with formulation and product development.
Venture capitalists and ag entrepreneurs take note; a CDMO such as CJB Applied Technologies is worth your consideration.
Contact us today to discuss your next formulation development or pilot project.