Probiotics for Agriculture

December 10th, 2013Total interviews: 75

The Pivot Team

Karsten TemmeCEO

Alvin TamsirCSO

Emily TungResearcher

John CumbersMentor

Academic labs

AgBio industry leaders

• Reduced risk of loss in drought

• Improved yield• Organic• Lower human and

equipment costs

Farmers• Corn• Wheat• Rice

TBD:- Fermentation scale up- Packaging and prep • Direct sales

• Local supplier / grain elevator

• Seed companies• Fertilizer companies• State fairs

Corporate farmFamily farm

OrganicConventional

• Direct relationships• Self service (3rd party

purchases)• On-farm interactions• Potential collaborative

relationships

• Inoculant purchases• Next-gen sequencing diagnostic• Licensing royalties

• Science – lab POC• Field trials • Regulatory engagement• Establish AgBio

partnership for sales channels

• Inoculant distribution• Customer service• Public relations

• Synthetic biology IP• Next gen sequencing IP• Proprietary microbes• Regulatory awareness• Sales staff• Production staff and

facility

Dow CorningBayer Monsanto

UC Davis Soil Ecology group

SynBerc

Week 1

Crops

Treatments GM Strains

Natural Strains

Fermented Metabolites

Probiotic Mixture

Natural Strains

• Germinated in sterile greenhouse conditions• CA dominates US tomato cultivation

• Tomato seed companies

• Tomato nurseries

• Tomato farmers

• Seed coating companies

• Reduced risk of loss in drought

• Improved yield• Organic• Lower human and

equipment costs

Farmers• Corn• Wheat• Rice

Corporate farmFamily farm

OrganicConventional

Week 5Week 1

Customer archetype

Plant health

YieldFruit quality

Disease resistance

Drought tolerance

Germination

Dale SmithHeinzSeed

• Manager of HeinzSeed Global• 60+ years of tomato seed breeding• Develops most of top tomato varieties• Looks for new technologies to improve tomato

production

Acreage:Location:

Market Size:

300,000 acres95% in CA$700M

Break even: 40 tons / acreAverage: 48 tons / acreHighest: 70 tons / acre

“10% yield improvement would be significant”

US Commercial Processing Tomato Industry

Commercial Farms

Channels and Market Structure

Nurseries

Seed breeders

Seed distributors

Seed production

Product Flow

Seed treatment

Grading and Processing

Cash Flow

The MVP Tomato Seeds

Heinz + PivotHeinz

Value if MVP applied to Top 10 Varieties of 2013

$10M

$7.5M

$5M

$2.5M

Red = Heinz varieties

Value based pricing

To Seed Breeders - $3MTo Greenhouses - $4M

To Farmers - $35M

Yield Increase - $70M

Pivot (40%) - $28M

$700MCurrent

Seed breeders Seed production

50% market

Seed treatment

Now Q1 2014 Q2 2014 Q3 2014 Q4 2014

Building the MVP: Key Metrics

Greenhouse Trial Field Trial

MVP

R&D Activites Milestone Cost

• Endophyte Isolation • 500 relevant strains $30k

• Sequencing and Analytics • All genomes annotated and scored $50k

• Selection and Optimization • 50 high confidence strains $140k

• Greenhouse Trial • 10% yield increase $60k

Personnel: 1 bioinformaticianPartners (done): Greenhouse (UC Berkeley), NGS (Seqmatic), Heinz and GermainsIP: File composition of matter on 50 high confidence strainsEconomics: Validate revenue sharing hypotheses, negotiate field trial financing

Week 10

Senior customer endorsement

Operational plan validated

Talent recruited

IP strategy and KOL network

“Proof of Relevance” defined

Timeline and cost to data points

Strategic fit in portfolio validated

Technology confirmed

First pass canvas