Intelligent Growth Solutions Attracts £5.4 million Series A Funding to Achieve Global Growth in Vertical Farming
Scottish agri-tech business to
deliver ground-breaking technology to burgeoning
indoor farming sector
Invergowrie, Scotland – 18 June 2019 - Intelligent Growth Solutions Ltd (IGS), the Scottish-based vertical farm technology business, announced today a £5.4 million Series A funding round led by US-based S2G Ventures, the world’s leading agri-foodtech investor.
IGS supplies highly sophisticated plug-and-play vertical farming technology to indoor farms to enable the efficient production of food in any location around the world.
To demonstrate the unique technology stack it has developed, IGS opened its first vertical farming demonstration facility in August 2018. Since that announcement the company has received significant interest from around the world with orders mounting for its ground-breaking, patented technologies.
IGS’ unique technology has been designed specifically to address some of vertical farming’s biggest challenges, including the cost of power and labour, as well as the inability to produce consistently high-quality produce at scale. These economic and operational barriers to growth have inhibited the sector’s expansion to date. IGS has designed all its products to be highly pragmatic, flexible, modular and scalable in-line with market requirements.
The £5.4 million investment will allow IGS to create jobs in areas such as software development, engineering, robotics and automation. It will also help IGS to increase its product development, including continued innovation in AI, big data and the Internet of Things. IGS will also be building global marketing, sales and customer support teams in three continents.
This growth is pivotal for IGS to meet significant demand from growers, retailers and governments aiming to address food security issues through alternative methods of production and new business models in their regions. In 2019, IGS will be deploying indoor farming systems for clients in every major territory globally.
With global market growth in vertical farming predicted at 24 percent per annum over the next three years, the opportunities for IGS are substantial, with over 95 percent of its sales expected to be exported either directly or through regional channel partners.
The Series A funding round was led by S2G (Chicago), the most active agri-foodtech investor globally in 2018, with online venture capital firm AgFunder (San Francisco), the second most active and Scottish Investment Bank (SIB).
“Indoor agriculture production is at a tipping point. Grocery and food service firms have never been more interested in adopting this in their future supply chain. Cost and quality of product will be critical to scale this adoption. IGS’s revolutionary technology has proven itself to reduce power consumption, improve ventilation and hence reduce the capital and human costs to deliver fresh and differentiated products to consumers,” commented Sanjeev Krishnan, Managing Director of S2G Ventures. “We are excited IGS will help enable this emerging movement”.
“We see IGS as the perfect foray for AgFunder into the indoor agriculture arena,” said Michael Dean, founding partner at AgFunder. “As a developer of highly sophisticated energy and control system technologies for third-party indoor farms, IGS satisfies our bias for investing in enabling technologies rather than technology-enabled production with the inherent risks associated with building and operating a large asset.”
Kerry Sharp, Director of the Scottish Investment Bank, said: “We are delighted to support the continued development of IGS as it looks to take its technology to the global marketplace. The company has been account managed by Scottish Enterprise since 2014 and has received both financial and non-financial assistance covering innovation and R&D as well as supply chain management and international market entry. The company has made significant progress over the last 12 months and has assembled an impressive team with a clear focus on taking the IGS offering to an international market.”
IGS Chief Executive Officer David Farquhar said “We are thrilled to have the backing of the world’s leading agri-tech investors and the Scottish Investment Bank. We have recruited a world-class international management team, to be announced soon, to drive our plan forward with support from a board of senior international business people bringing industry expertise and best practice governance to the table.
“This industry is just at the starting line and we look forward to working with our customers, partners and colleagues at the James Hutton Institute to enable the highest quality produce to be grown at economically viable prices and help feed the burgeoning global population.”
The Scottish-led R&D team at IGS has developed, patented and productised a breakthrough, IoT-enabled power and communications platform consisting of patented electrical, electronic and mechanical technologies. All this is managed by a SaaS and data platform using AI to deliver economic and operational benefits to indoor growing environments across the globe. This technical solution enables the potential for reduction of energy usage by up to 50 per cent and labour costs by up to 80 per cent when compared with other indoor growing environments. It also can produce yields of 225 per cent compared to growing under glass.
Thorntons’ corporate and commercial team (led by Alistair Lang and with support from Victoria McLaren and wider team) acted for IGS throughout the Series A funding process.
A Shepherd and Wedderburn corporate team (led by Stephen Trombala with support from Christina Sinclair and Cath Macrae) acted for Chicago-based S2G Ventures - the lead investor in the first closing of the series A financing of Intelligent Growth Solutions Limited.
About IGS:
IGS was formed in 2013. Its purpose was to bring indoor horticulture to commercial reality by combining efficient internet-enabled smart lighting with automation and power management. The founders’ experience combined extensive knowledge of horticulture, industrial automation and big data.
IGS launched its first vertical demonstration facility in August 2018 and is now selling a revolutionary controlled-environment growth system. The location of IGS’ facility at the James Hutton Institute, a world leading crop research facility, was deliberately chosen to enhance collaboration opportunities for the benefit of customers. Scientists and researchers at the Institute are working with the team at IGS to better understand how growing indoors can impact different varieties of crop growth, as well as driving increased productivity.
For more information visit www.intelligentgrowthsolutions.com or connect with us on Twitter and LinkedIn.
About S2G Ventures:
S2G Ventures (Seed to Growth) is a multi-stage venture fund investing in food and agriculture. The fund’s mission is to catalyze innovation to meet consumer demands for healthy and sustainable food. S2G has identified sectors across the food system that are ripe for change, and is building a multi-stage portfolio including seed, venture and growth stage investments. Core areas of interest for S2G are agriculture, ingredients, infrastructure and logistics, IT and hardware, food safety and technology, retail and restaurants, and consumer brands. For more information about S2G, visit www.s2gventures.com or connect with us on Twitter and LinkedIn.
About AgFunder
AgFunder is an online Venture Capital Platform investing in the bold and exceptional entrepreneurs transforming our food and agriculture system. Our in-house technology enables us to invest globally and at scale, make better investment decisions, and support our portfolio companies. Through media and research, AgFunder has built a community of over 60,000 members and subscribers, giving us the largest and most powerful network in the industry.
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About Scottish Investment Bank:
The Scottish Investment Bank (SIB) is the investment arm of Scotland’s national economic development agency, Scottish Enterprise, operating Scotland-wide in partnership with Highlands and Islands Enterprise (HIE). SIB’s activities support Scotland’s SME funding market to ensure businesses with growth and export potential have adequate access to growth capital and loan funding.
SIB manages a suite of co-investment funds including the Scottish Co-investment Fund, the Scottish Venture Fund and the Energy Investment Fund on behalf of the Scottish Government. SIB is also an investor in Epidarex Capital’s Life Sciences Fund and is a participant in the Scottish-European Growth Co-Investment Programme with funding secured from the Scottish Government’s Scottish Growth Scheme alongside the European Investment Fund.
SIB also provides funding into LendingCrowd, Scotland’s marketplace lender providing loans to SMEs, and Maven's UK Regional Buy Out Fund (MBO) that offers financial support for management buyouts (MBOs) and helps existing management teams acquire their businesses from their owners so they can continue to flourish. SIB’s team of financial readiness specialists help companies to prepare for new investment and access appropriate finance.