The pitch sounded audacious: Turn a plant that most farmers considered a weed into a cash crop.
It was 2012, and some visiting scientists made a presentation about field pennycress at the Danforth Plant Science Center’s innovation showcase. The seeds’ oil content showed promise for renewable fuel production, and the federal government had funded research.
Former Monsanto executives Vijay Chauhan, Dennis Plummer and Mike Roth were intrigued enough to form a company around the idea. They got early backing from BioGenerator, a seed fund and business incubator, and would eventually raise money from other local investors including Cultivation Capital, Yield Lab, the St. Louis Arch Angels, St. Louis County’s Helix Fund and the state-backed Missouri Technology Corp.
Creating a new cash crop is a tall order, but the startup would improve pennycress’ yield enough to make it commercially viable. It also found partners willing to process the seed into biofuel. Last Monday, their efforts paid off when agribusiness giant Bayer bought majority ownership of CoverCress Inc., now a 25-employee company based in Creve Coeur.
Financial terms weren’t disclosed but Charlie Bolten, senior vice president at BioGenerator, said the investors all made big gains. “I think everyone’s very happy,” he said.
The CoverCress acquisition comes less than a year after Benson Hill, another local agriculture startup, made its stock market debut. That makes two high-profile exits for investors who bet on St. Louis as a center of ag entrepreneurship.
“This is another big moment,” Bolten said. “It proves that we have the talent to do this in St. Louis. Nothing counts until you start getting returns.”
“It’s a heck of a St. Louis story,” echoed Jerry Steiner, CoverCress’ chairman and former chief executive. In its early days, he recalled, the company had cheap office space at the county’s Helix Center and was able to “squat” on lab equipment owned by St. Louis Community College. “This area has a really good system for getting companies going,” Steiner said.
No one has introduced a major cash crop in North America since canola was developed from rapeseed a half-century ago. CoverCress plans a commercial introduction this fall, planting 10,000 acres.
CEO Mike DeCamp said the plan is to expand to 250,000 acres in three years and 3 million acres by 2030. Farmers will be won over by “the economics we’re able to offer,” he said.
CoverCress is planted in fall and harvested in spring, so it lets farmers profit from a crop when their corn and soybean acres would otherwise be idle. It also serves as a cover crop, reducing winter soil erosion.
Jennifer Ozimkiewicz, senior vice president for corn and soy strategy at Bayer Crop Science, said the prospect of producing low-carbon fuel while improving soil health made CoverCress a compelling investment. “It is a great and tangible example of our commitment to sustainability and innovation,” she said.
Bayer owns 65% of CoverCress, with Bunge and Chevron remaining minority shareholders.
Each owner brings strategic value. Bayer knows how to sell seed to farmers, Bunge knows how to process oilseeds, and Chevron knows how to produce and sell biodiesel. “We think we’ve built a strong team,” DeCamp said.
It’s also a team with deep roots here. The majority of CoverCress employees formerly worked for Monsanto, which Bayer bought in 2018. Plenty of non-employees, at institutions such as BioGenerator and the Danforth Center, also contributed to the homegrown success story.
Decades from now, when historians describe how a weed became a valuable crop, they’ll know it happened in St. Louis.Read More at St. Louis Post-Dispatch →