Even ahead of the new proposed tax credits for research and development activities, smart businesses interested in sustainability have been funding activities that could be commercially viable for their own company’s future. One of the biggest examples of that to date is the GE ecoimagination challenge, which is offering up $200 million for ideas and technologies related to the smart grid. But there are many other companies doing their part.
Just heard about a new partnership, for example, that is being coordinated by Nidus Investment Partners out of St. Louis. Nidus has just announced that both agricultural products and technology giant Monsanto and agribusiness and food company Bunge Limited have put up $1.5 million (each) toward a new partnership to find and commercialize agricultural and energy innovation more quickly than the market might otherwise bear.
In exchange for that money, they will get an early peek at the companies being vetted by Nidus.
Vicki Gonzalez, managing partner of Nidus, says her company gravitated toward agriculture because this is an industry that must invest in innovation to ensure its successful future. Think of this partnership as the reverse of a venture capital firm: The partners are actively looking for technologies that might serve a role in their own product lines in the future. They aren’t being pitched about wild ideas that have nothing to do with their core business.
Over the next 12 months, the Nidus team of six or seven entrepreneurs in residence — along with representatives from the sponsoring partners — hope to investigate more than 100 different technologies and companies each year, plucking them from universities and national labs. This is the Nidus Strategic Technology Council, led by Ralph Quatrano, who is dean of the School of Engineering and Applied Science at Washington University in St. Louis. The council will do this in collaboration with representatives from the contributing commercial partners. Some of these technologies — maybe five to 10 each year — will receive seed funding; the potential for a commercial relationship with one of the corporate partner is also a possibility, although it is not guaranteed.
Nidus plans to build a parallel fund of a minimum of $20 million that will allow additional private and institutional investors to contribute to the partnership.
Here’s some perspective from Jerry Steiner, executive vice president of sustainability and corporate affairs for Monsanto:
“The Nidus partnership is a great fit for our company because it enables us to work hand-in-hand with new scientists and entrepreneurs who have identified potential solutions to the challenges growers face. The Nidus partnership focuses on selecting and developing new technologies of particular interest to us and can solve some of the most important challenges at the intersection of agriculture and energy.”
The partnership is currently evaluating carbon capture, gasification, alternative energy projects, and biological systems that could help lead to alternative fuels, Gonzalez says. Nidus is seeking additional three to five additional partners to participate. She says we can expect its first announcement about a specific project investment in the very near future.
