Welcome to the 64th edition of Upstream Ag Professional!
Index
From Chatbots to Digital Teammates: How AI Agents Fit Into Agribusiness
Meristem Crop Performance Partners with Bridgepoint to Catalyze Growth
BASF Continues to Expand Their Biological Partnerships
AgroSpheres and BASF Announce Major Strategic Partnership
BASF and Elicit Plant Partner to Promote New Bio-Solutions in the Sunflower and Cereal Markets
Strategic R&D Management in the Crop Protection Industry
How market realities have tossed a wrench into Telus’s spinout plans: TELUS Ag and Consumer Goods Implications
Carbon Robotics Raises $70 Million Series D Investment Round
Nitrogen Fixation Remains Questioned in Scientific Community
Non-Ag Article: The Strategy Questions
Other Interesting Ag Articles (9 this week)
1. From Chatbots to Digital Teammates: How AI Agents Fit Into Agribusiness - Upstream Ag Professional
Key Takeaways
Vertical LLM agents, designed for specific industries like agriculture, can automate complex tasks such as data analysis and targeted communications. This specialization will allow agronomists and sales teams to save time while maintaining the necessary oversight for context-specific decisions.
For AI agents to become valuable in agribusiness, they should become part of core workflow— with ERPs or control point systems, or develop a new workflow.
A Digital Teammate
In the ever-evolving world of AI, LLM agents— autonomous applications powered by Large Language Models—have the potential to evolve how we perform day to day tasks as knowledge workers in agriculture.
Agents are an advanced evolution of LLMs.
An LLM agent is an artificial intelligence system that utilizes a large language model as its core engine to deliver capabilities beyond text generation, including conducting conversations, completing tasks, reasoning, and even demonstrating some degree of autonomous behavior.
LLM agents can be directed through prompts that encode personas, instructions, permissions, and context to shape the agent's responses and actions.
The key advantage of LLM agents is their ability to have varying degrees of autonomy. Based on the capabilities built during the design phase, agents can exhibit self-directed behaviors ranging from purely reactive to highly proactive.
LLM agents, with proper access to data and prompting, can work semi-autonomously to assist people in a range of applications, from the typical chatbots to goal-driven automation of workflows and tasks.
We are somewhere between Level 2 and Level 3 today in deployed agents.
Here is the Index for the full article:
AI Agents: A Digital Teammate
OODA Loop
Vertical Agents
Levels of Agents
Agent Use Cases for Agriculture
Marketing and Sales and the Integration of Systems
CRM Data Acquisition
Product/Company Research
Where Do Agents Live?
Control Points
Final Thoughts
2. Meristem Crop Performance Partners with Bridgepoint to Catalyze Growth - Upstream Ag Professional
Key Takeaways
Meristem's growth was catalyzed by its founders' unique insights into the inefficiencies of traditional crop input distribution channels and the potential in the biologicals segment. By focusing on direct sales and developing proprietary IP like the BIO-CAPSULE system, Meristem has been able to offer cost-effective, novel solutions that are simple for farmers. This approach has driven its expansion to over 8 million acres of biologicals in 2024.
Bridgepoint’s investment in Meristem provides the capital needed for scaling operations, especially as the company pursues new partnerships and licensing opportunities. The potential for licensing the BIO-CAPSULE system to Rovensa, another Bridgepoint portfolio company, highlights a strategic alignment that can expand Meristem's reach into global markets. This partnership positions Meristem to continue its growth both as a U.S. supplier and as a global innovator.
Bridgepoint, a leading private asset growth investor, has announced today its partnership with Meristem, a leader in the agricultural solutions market. The transaction closed in October 2024 and financial terms were not disclosed.
Established in 2018, Meristem is one of the fastest-growing crop input companies in North America. Focused primarily on biologicals, the company sources, formulates, licenses, and delivers high-quality crop inputs to farmers, helping them produce more bushels for less cost per bushel. Meristem's solutions are highly cost-effective and eliminate significant inefficiencies in the supply chain compared to more traditional go-to-market approaches.
Press Release link available in the full article due to sizing restrictions.
Meristem Crop Performance is an enterprise that has built an impressive business, but before getting into the importance of their new capital injection I think it’s worth highlighting what, at it’s most basic, enabled the Meristem team to get to this point.
In The Insight is the Edge I stated that insights are fundamental for the success of any business.
An insight is defined as:
the capacity to gain an accurate and deep intuitive understanding of a person or thing.
This can be a customer, a technology or a market for example. An insight that is actionable is what differentiates a business. Acting on an insight allows a company to be different and an insight is core to having a unique strategy. As Michael Porter said in Competitive Strategy:
If a firm is to gain advantage, it must choose the type of competitive advantage it seeks to attain and a scope within which it can be attained…The worst strategic error is to be stuck in the middle, or to try simultaneously to pursue multiple strategies. This is a recipe for strategic mediocrity and below-average performance, because pursuing all the strategies simultaneously means that a firm is not able to achieve any of them.
The business needs to see something different than their competitors and lean into it.
Meristem Crop Performance is a perfect example of a company who’s founders, Mitch Eviston and Rob McClelland, had a unique insight that lead to the founding of Meristem in 2018.
Mitch and Rob had insight into several areas that have enabled them to build a profitable business generating more than $150 million in annual revenue on more than 10 million acres, with 8 million acres of those including biologicals:
The amount of dollars going to the channel (distributors + retailers) out of what the farmer was paying, giving them an understanding of the opportunity to cut costs out of the end price to the farmer.
There was a lower margin, more competitive segment (synthetic crop protection) that everyone else could fight over and a growing, higher margin segment that they could differentiate on: biologicals. They opted to lean into biologicals. They also acknowledged that the channel was poorly positioned to readily sell these products because of knowledge base and current incentive structures. Mitch Eviston even said to me: “If we launched our products through the channel, we wouldn’t be around today.”
They knew the challenges with biologicals and began building out intellectual property that could enable them to not only keep biological organisms living throughout the value chain, but deliver adequate CFUs to the soil through current farmer practices. Some of their IP includes their BIO-CAPSULE packaging and distribution system (more below), and novel approach to adjuvants taking on a Coca-Cola-like strategy.
They acknowledged that there was a segment of farmers that was sophisticated and equipped with the right assets (application equipment, storage etc) that they could sell direct to and build out their own channel. They also acknowledged that they needed experienced staff to be able to do this and hired accordingly.
When combining these insights together, you get the start of Meristem Crop Performance.
From there, their business has grown rapidly.
Bridgepoint Investment and BIO-CAPSULE: Global Ambitions
Bridgepoint Group is an international alternative asset manager specializing in private equity, infrastructure and private credit. Bridgepoint currently has $72 billion of assets under management.
Until this investment, Meristem had been bootstrapped!
Having enough working capital can be challenging in times of rapid growth. In conversation with Meristem they stated they have multiple incoming partnerships that require a large up front investment to build out product, which meant they needed to ensure they had adequate cash reserves— taking on investment to fund inventory for agreements vs. speculative technology.
The investment number was not stated, but given that Meristem has $150 million in revenue, has 30%+ operating margins and has multiple patents that are generating revenue through licensing agreements today, it’s likely the business was valued well into the hundreds of millions.
Meristem is the type of business private equity firms find and invest in— stable and growing businesses with IP.
There is another aspect that makes Meristem attractive to Bridgepoint: they are invested in Rovensa, one of the largest independent bio-based companies globally.
For the full article, including more on horizontal businesses in biologicals, sales channel evolution, Meristem’s potential licensing partners and what that means for the industry, along with their new product initiatives, check out the link above.
3. BASF Continues to Expand Their Biological Partnerships
When I originally shared this image in early 2024, it didn’t even include BASF because the last major (global) announcement surrounding BASF and bio-based partnerships or initiatives was when they acquired Becker Underwood in 2012:
In September when they announced that they would be spinning BASF Agricultural Solutions into a separate entity, I highlighted their bare bones biological pipeline, a signal that the Becker Underwood assets and capabilities have not kept up with what other entities in the industry have been building:
One takeaway for me was the low number of bio-based products. If we compare to a Bayer, Corteva or FMC pipeline it is not just small, but non-existent outside two products only in fruit and vegetable. BASF has been one of the quietest on the biological front, too. Where others have actively shared their ambitions.
I suggested they are likely to acquire, highlighting potential targets like Rovensa, Verdesian or Acadian.
Last week they announced a global partnership with Acadian, an acknowledgement that they see growth in the biostimulant segment.
I suggested partnerships might not be enough when there is a requirement to innovate, suggesting the following:
But given the reliance these entities have on being “innovation” first, they need to continue to have the confidence of distribution in being a market shaping product development company, which is why I still believe BASF (and others) will seek more than partnerships with companies like Acadian, or other RNAi/peptide/enzyme companies.
The last sentence turned out to be prescient in that this week they announced an agreement with biomolecule company AgroSpheres:
a. AgroSpheres and BASF Announce Major Strategic Partnership - AgroSpheres
AgroSpheres, a biotechnology leader in sustainable crop protection and crop health, and BASF, a global leader in agricultural solutions, are excited to announce their strategic partnership on a category defining novel bioinsecticide.
The companies are working together to develop biological crop protection products leveraging AgroSpheres AgriCell-powered biomolecules. Both companies are encouraged by the levels of efficacy that have been demonstrated at low dose rates to control key agricultural lepidopteran pests.
AgroSpheres announced a partnership with strategic investor FMC earlier this year on a bioinsecticide.