Case Indigo Agriculture - Harnessing Nature

t
os
9 - 6 2 0 -0 2 4
REV: JUN E 26, 2020
rP
MARCO IANSITI
MICHAEL W. TOFFEL
JAMES BARNETT
Indigo Agriculture: Harnessing Nature
yo
On an afternoon in May 2019, Indigo Agriculture CEO David Perry and Chief Innovation Officer
and co-founder Geoffrey von Maltzahn sat on the back porch of von Malzahn’s home, watching their
kids playing while discussing the future of the company. Based in Charlestown, Massachusetts, Indigo
was a late-stage agricultural technology (ag-tech) startup that used microbiology and data science to
develop microbial seed coatings and advisory services to enable growers to reduce and even eliminate
the use of synthetic fertilizers and chemicals. More recently, in September 2018, the company had
op
launched Indigo Marketplace, a digital platform that sought to directly connect farmers and buyers of
grain. This could de-commoditize grain sales, which could enable farmers to earn premiums for crop
attributes that buyers desired beyond those required by commodity standards. In January 2019, the
company launched Indigo Transport, a platform akin to Uber or Lyft that provided decentralized
carrier options—including farmers who wanted to use their own trucks—to transport grain purchased
on Marketplace to the buyers. Indigo had raised more than $700 million in venture funding and had a
valuation reported to exceed $3.5 billion. 1 The company ranked first on CNBC’s list of the world’s most
tC
disruptive companies in 2019. 2
Perry and von Maltzahn were now discussing whether or not Indigo should embark on a significant
initiative that could have an even greater impact on mitigating the increasingly urgent issue of climate
change. They were considering ways to increase the diffusion of regenerative agriculture, a set of
agricultural practices that increased carbon content of soils. Traditionally viewed as a way to enhance
the productivity of soils, regenerative agriculture also sequestered (moved) carbon dioxide (CO2) from
No
the atmosphere into agricultural soils. Perry and von Maltzahn wondered if Indigo should create a
carbon market to enable growers to get paid for sequestering carbon, and launch parallel efforts to help
growers assess and deploy the most effective regenerative agricultural practices suitable to their
particular circumstances.
Perry believed that carbon market incentives might encourage enough farmers to adopt
regenerative agricultural practices to sequester one trillion tons (one teraton) of CO2, which was the
total amount of CO2 that had increased in the atmosphere since the industrial revolution.
Do
Professors Marco Iansiti and Michael W. Toffel and Case Researcher James Barnett (Case Research & Writing Group) prepared this case. It was
reviewed and approved before publication by a company designate. Funding for the development of this case was provided by Harvard Business
School and not by the company. The Laboratory for Innovation Science at Harvard has conducted pro bono work for Indigo Agriculture. HBS cases
are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of
effective or ineffective management.
Copyright © 2019, 2020 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-
7685, write Harvard Business School Publishing, Boston, MA 02163, or go to www.hbsp.harvard.edu. This publication may not be digitized,
photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School.
This document is authorized for educator review use only by John Mano Raj S, Indian Institute of Plantation Management until Jul 2023. Copying or posting is an infringement of copyright.
Permissions@hbsp.harvard.edu or 617.783.7860
620-024 Indigo Agriculture: Harnessing Nature
t
os
Perry and von Maltzahn wondered if the Indigo team could actually take on yet another initiative,
the third in a year’s time. There were serious challenges to consider as they decided whether and how
to proceed.
The first challenge was that regenerative farming practices were rarely deployed, and most growers
were skeptical about changing their farming practices. To get farmers to utilize regenerative farming
rP
practices, Indigo not only highlighted their potential for long-term yield gains, cost reductions, and
operational resiliency, but also sought to demonstrate that growers could earn money from the carbon
sequestration a that regenerative practices enabled. However, this required figuring out how to reduce
the cost of third-party companies quantifying and verifying how much carbon content had increased
in the soils (and thus had been sequestered from the atmosphere) in order to produce third-party
certified carbon credits. Indigo also had to figure out how to bring these credits to a market where
buyers would value and pay for them. Indigo believed credits that sold in the range of $15 to $20 per
yo
ton of CO2 could encourage many growers to rapidly adopt regenerative practices. Perry explained,
“The average U.S. farmer is making less than $40 an acre today. So if they can sequester two to three
tons of carbon per acre per year on average, that’s an extra $30 to $60 per ton, more than doubling their
profitability.”
Indigo estimated that rebuilding carbon stores in agricultural soils and enriching them further
through innovation had the potential to sequester one trillion tons of excess CO2 from the atmosphere,
an aspiration they had begun to refer to as the “Terraton Initiative.” Launching the Terraton Initiative
op
would require not only immediate allocation of $35 million in capital, but also hiring more staff,
reallocating some staff from existing and planned business lines, and also increasing workhours across
the organization, all of which impaired short-term productivity. It would undoubtedly create
organizational strain, but its success could potentially benefit far more than Indigo’s bottom line.
The Agriculture Industry

tC
Food and agribusiness was a $5 trillion industry globally that consisted of multi-tier supply chains.
In the U.S., agriculture and related industries contributed $835 billion, or 4.8%, of the county’s GDP in
2014. U.S. farm output accounted for $177.2 billion of this sum, about 1% of total GDP. 3 In 2014,
agriculture provided 17.3 million full- and part-time jobs, or 9% of total U.S. employment of whom 2.6
million people were directly employed by farms. 4 Over 400 million acres, or 18% of total U.S. land area,
were devoted to crops. 5 The number of farms in the U.S. had peaked at 6.8 million in 1935 and gradually
No
leveled off by the 1970s as farms became more productive and many jobs shifted to manufacturing;
roughly 2.1 million farms operated in the U.S. in 2012 (see Exhibit 1). 6 Advances in technology and
chemical inputs contributed to economies of scale, resulting in large farms being responsible for most
agriculture production. Although the number of farms declined over time, output more than doubled
between 1948 and 2013. 7
As of 2011, 90% of U.S. farms were considered small family farms (reporting annual gross cash farm
income of less than $350,000), and such farms operated 52% of all U.S. farmland. 8 Midsize and large-
scale family farms made up 8% of U.S. farms, but 60% of the value of production (see Exhibit 2). 9 Large-
Do
farm production accounted for 80% of all U.S. food sales in 2012. 10 As of 2012, California led all other
states in agriculture production with 11% of all crops and livestock, followed by Iowa, Texas, Nebraska,
and Minnesota. 11 That year, California’s crop value exceeded $30 billion. 12 In 2015, corn was the top
a Carbon sequestration referred to any process (natural or engineered) by which carbon dioxide was removed from the
atmosphere and held in solid form (such as in soils or vegetation) or in liquid form (such as in oceans).
Indigo Agriculture: Harnessing Nature 620-024
t
os
crop by production value in the U.S., generating $49 billion in revenue, followed by soybeans ($34
billion) and wheat ($10 billion). 13 (See Exhibit 3 for crops ranked by U.S. production value, and Exhibit
4 for historical cereal yield growth.)
The grain supply chain was designed more than a century ago to consolidate harvests from various
farms to leverage economies of scale in their collection, transportation, and processing. As a result,
rP
grains were managed and priced as commodities that had to meet minimum government quality
standards, and were traded on commodity exchanges. b Grain farmers (growers) typically sold their
crops to consolidators (e.g., grain elevators), who sold to traders, who in turn sold to food producers
(see Figure A for a list of supply chain players). Grain traders were highly concentrated,14 as Archer
Daniels Midland, Bunge, Cargill, and Louis Dreyfus (known as the ABCDs) controlled a majority of
the global grain trade market. 15
Figure A Traditional Agriculture Supply Chain
Source: yo
Casewriter based on KPMG, “The agricultural and food value chain: Entering a new era of cooperation,” p. 5, May
2013, https://bit.ly/2kSpFPG, accessed September 2019.
op
The agricultural industry was ranked last among industries by McKinsey in terms of deploying
information technology (see Exhibit 5).16 Farmers’ concerns about sharing data was a potential
challenge to the deployment of information technology in agriculture. A 2016 American Farm Bureau
survey noted that 77% of farmers were “concerned” or “extremely concerned” about who could access
their data. 17 A few organizations were nonetheless investing in ways to digitize agriculture. For
example, Bayer’s Climate FieldView (formerly Climate Corporation) was a software platform that
tC
collected farmers’ field data using hardware attached to farm equipment, tracked agronomic decisions,
assessed crop performance, stored weather data, and used algorithms to offer customized farming
advice to optimize crop yields. 18 A few technology startups launched software-based farm-
management systems that focused on niche markets or geographies, such as grape vineyards in
particular regions. 19 And some agriculture equipment companies were implementing digital
technologies, such as John Deere’s software platform that collected and managed farm data from
sensors connected to its equipment to help farmers manage their equipment fleet, reduce downtime
No
inefficiency, and save on fuel costs. 20
Agriculture and Climate Change

Agricultural production (crops and livestock) and deforestation—land clearing that was mostly for
agriculture—produced about 25% of the world’s greenhouse gas emissions (GHG), whose rising
concentration was leading to global climate change. 21, c In addition to burning forests to clear land for
agriculture (which shifted carbon from vegetation to the atmosphere), GHG emissions were released
Do
from the production and use of fertilizers and other agriculture inputs, the use of fossil-fuel powered
b For example, commodity standards might specify minimum weight per bushel, maximum moisture content, maximum
contamination levels, and other criteria.
c Other major GHG emissions sources included the combustion of fossil fuels to power transportation and generate electricity,
and certain industrial processes.
t
os
farming equipment, and in the tilling of agricultural lands. Several modern farming practices were also
leading to soil runoff, the reduction of carbon in soils, and extensive use of chemical pesticides and
herbicides were transforming rich soils teeming with life into relatively lifeless dirt, which often
triggered the application of chemical fertilizers. For example, tilling, the mechanical agitation of soil
to remove weeds established in the prior growing season, led to carbon evaporation and risked soil
erosion. At the same time, soils had enormous potential to sequester atmospheric carbon, especially
rP
through the restoration of degraded soils. The carbon in the world’s soils to a depth of one meter was
twice the amount of carbon in the atmosphere (as CO2). 22 Methane emissions from livestock was
another significant source of GHG emissions. 23 Population growth and economic development
forecasts anticipated a near doubling in demand for crops by 2050. 24
Increased GHG concentrations resulted in the atmosphere trapping more heat from the sun, which
intensified the atmosphere’s natural greenhouse effect and caused global climate change (see Exhibit
yo
6 for an illustration of the earth’s carbon cycle). As a result, temperature increases in the past few
decades were twice as fast as increases in the ten decades leading up to 1981 (see Exhibit 7); more
frequent and intensive storms were occurring, and were forecasted to accelerate, as were more extreme
and erratic rainfall, and more extreme droughts and heatwaves (see Exhibits 8a-8e). 25, d In 2015, studies
projected that yield trends for major U.S. field crops would slow down or reverse by 2020 due to
increasing temperatures and changes in precipitation. (See Exhibit 9 for forecasted changes in crop
production due to climate change.) 26
op
The Intergovernmental Panel on Climate Change (IPCC)—a United Nations body that sought to
provide scientific information of climate change, its natural, political, and economic impacts and risks,
and potential solutions)—had stated that limiting global warming to no more than 2° Celsius from
preindustrial levels was required to avoid the worst effects of climate change. Policy efforts, including
the 2015 Paris climate agreement, had not set targets sufficiently ambitious to reach that goal, which
was thought to “require near-total decarbonization of global economic activity by 2060.”27
tC
Reducing GHG emissions would require transitioning from fossil fuels to renewable energy and
battery power, developing more energy efficient technologies, and changing agricultural practices to
avoid fossil fuel based agricultural inputs. In addition, some were investigating the feasibility of large-
scale efforts to reduce GHG concentrations by sequestering CO2 into oceans (such as by seeding them
with iron to increase their absorption capacity) or into soils by planting forests and engaging in
regenerative agricultural practices (see Exhibit 10 for a comparison of carbon sequestration
alternatives). Others were investigating adaptation measures that sought to reduce the impact of
No
heightened GHG concentrations. Examples included designing more resilient buildings to endure
more intensive storms and sea level rise, formulating crops that could withstand droughts and
saltwater incursion, and investigating whether particles could be diffused into the atmosphere to
reduce the amount of solar energy that reached the earth’s surface.
Indigo Agriculture28
Indigo Agriculture was a Boston, Massachusetts-based company founded in 2014. e In 2012, biotech
Do
inventor and serial founder Geoffrey von Maltzahn initiated a project at life sciences venture capital
firm Flagship Pioneering, where he was a partner, to explore agricultural opportunities related to
d Climate change was also melting polar ice caps, glaciers, and sea ice, warming the oceans and changing their salinity and
acidity, and raising sea levels that threatened coastlines and caused unpredictable coastal flooding.
e Originally called Symbiota, the company was renamed in 2016.
t
os
microbes, the trillions of bacterial and fungal microorganisms found in every part of the biosphere.
Microbes had been long known to associate with humans and plants, and a small number of microbes,
called pathogens, could cause disease. Driven by technological advancement in molecular and genomic
analysis, research had emerged in the 2000s that revealed the role that microbes in the human gut play
in protecting their host from a diversity of human diseases. 29 With a PhD in biomedical engineering
and medical physics from MIT, von Maltzahn co-founded four companies before Indigo, including
rP
Seres Therapeutics, which was dedicated to human microbiome therapeutics. Von Maltzahn explained
how his interests at Flagship extended to the plant: “By helping humans, microbes improve their own
evolutionary destiny, because the success of the microbes inside of us depends on our health—when
we die, most of them die as well. If the same was true for plants, which turn out to also have microbial
communities within their tissues, then the microbes inside of plants might have spent millions of years
helping plants survive drought, heat, cold, salt, nutrient stress, and beyond.” This perspective led von
Maltzahn and Flagship to found Indigo, which von Maltzahn led from its exploratory stages through
yo
2015.
David Perry was appointed Indigo’s president and CEO in January 2015. Born and raised in
Magnolia, Arkansas, Perry completed his MBA and then spent several decades as a serial entrepreneur
and CEO. In 1997, he had founded an online business-to-business marketplace for industrial chemicals
(Chemdex, renamed Ventro), raising $45 million from venture capitalists and $112 million from an
initial public offering (IPO). The firm reached a $7 billion market capitalization during the dot-com
boom—and Perry was named Entrepreneur of the Year in Northern California 2000 by Ernst &
op
Young 30--before the company went nearly bankrupt in 2001 in the dot-com crash. Perry moved on to
co-found and serve as CEO and President of Anacor Pharmaceuticals, which developed small-molecule
therapeutics to treat infection and inflammatory diseases. Perry took Ancor public in 2010, which Pfizer
purchased in 2016 for $5.6 billion. After leaving Anacor in 2014, Perry recalled, “I took nine months off
to think about what I wanted to do next, and I decided to focus on agriculture. I think there are three
big questions worth addressing. First, how do we meet the world’s growing caloric need as the
tC
population increases? Second, how do we do it sustainably? Third, how do we change people’s

behavior around food?”
Indigo established its mission as “harnessing nature to help farmers sustainably feed the planet.”
Indigo had received several rounds of venture capital funding, and by 2018 had become the most well-
funded ag-tech startup to date. 31 Beyond the Boston area, Indigo had opened offices in Argentina,
Australia, Brazil, India (via a joint venture), and Switzerland. The company employed approximately
1,000 people, including more than 90 grower account managers who visited growers, several hundred
No
employees in R&D, Engineering, and Information Technology (IT), and more than 100 dedicated to
analytics and artificial intelligence (AI). Indigo’s data platform was developed and maintained by over
200 people from Engineering, Architecture, IT, Data Innovation, BioInnovation, and GeoInnovation
groups. Engineering and IT were responsible for the transactional systems that captured and generated
the data, and delivered and organized the data into the company’s “Unified Data Platform” data
warehouse. The Data Innovation group was responsible for the analytics based on the data platform
and for working with the business functions to embed the analytics into their teams. (See Exhibit 11
for an organizational chart.)
Do
Indigo first launched its microbial products into the US market in 2016 and began to realize the
opportunity for more systemic innovation across the agriculture value chain. Indigo felt that a growing
number of consumers increasingly cared about not only the nutritional value of their food but also the
way in which it was grown. While microbiome products helped reduce the amount of synthetic
chemicals and fertilizers needed to produce a crop, the conventional agricultural supply chain did not
enable consumers to trace their food back to the farm to understand its environmental footprint. This
t
os
meant there was also little opportunity for growers to get paid a premium for crops they produced in
particular ways that could satisfy such consumers. These realizations led to the expansion of Indigo’s
scope from microbiome products to include systemic innovations in both Indigo Marketplace and
Indigo Transport. Perry recalled, “The current system of agriculture was created about a hundred years
ago. We’ve come a long way since then. Indigo’s core hypothesis is ‘We don’t have to do it that way
anymore.’” 32
rP
Microbiome Seed Coatings 33
Indigo conducted research to identify microbes in nature that, when coated on seeds, would enable
crops to be more resilient to a wide range of stresses and would increase crop yields through improved
nutrient retention and better protection against drought, disease, and pests. The American Society of
Microbiology stated that improving crop yields was necessary, yet concluded:
yo
Vast increases in use of fertilizers, water, and pesticides are not only economically
impractical, but would have many negative environmental consequences. Scaling up
current high-input agricultural systems is simply not feasible. . . . Producing more food
with fewer resources may seem too good to be true, but the world’s farmers have trillions
of potential partners that can help achieve that ambitious goal. Those partners are
microbes. 34
op
Indigo established its first lab in 2013 to research and plan its initial microbe-enhanced seed
products. Initially prioritizing strengthening wheat and cotton against abiotic stressors (e.g.,
fluctuations in heat and water) rather than pests, the team first focused on identifying such microbes
and screening them. For example, they looked for naturally-occurring plants and crops that thrived in
dry regions with nutrient-poor soil, and compared their microbiota to agricultural crops in order to
predict how individual microbes (or combinations) of from these stress-surviving plants might
tC
improve the yield of agricultural crops in dry conditions. “By monitoring what microbiota looked like
in nature and across a range of plant hosts in different locations, we hypothesized we could build a
platform to solve a variety of opportunities in agribusiness,” von Maltzahn explained. COO of North
America Rachel Raymond noted, “By finding microbes that increased a plant’s ability to uptake
nutrients (nitrogen, phosphorus, and potassium) from the soil and more efficiently convert those
nutrients into grain, Indigo’s microbiome products reduced the amount of synthetic fertilizer that
needed to be applied to support the growth of the plant.” Indigo also collaborated with researchers
No
from several universities who had collected and genetically sequenced thousands of microbial samples.
Once they identified microbes they sought to test, Indigo exposed them to seedling assays, then in soils
in greenhouses, and finally in field tests, recorded a host of data including grain growth as well as soil,
temperature, moisture, and lighting conditions.
The team’s commercialization efforts included submitting field test results to the U.S. Department
of Agriculture and signing agreements with contract manufacturers to apply the coatings to seeds.
Indigo planned to sell its microbiome products directly to growers, a departure from the typical
agricultural supply chain, where growers typically bought seeds, fertilizers, and other agricultural
inputs from distributors. Before making a sale, Indigo established relationships with farmers, focusing
Do
on those who were known to be technology adopters and thought leaders. Perry explained, “We said,
‘We’re working on a new technology and think it’s going to be really important. It’s very early. If you
become our customer, we think we’ll bring you benefits this year, and we think we’ll get better and
better over time.’”
t
os
In May 2016, the first seeds coated with Indigo’s microbiome products were planted on cotton fields
across nearly 60,000 acres throughout the mid-South and West Texas. Indigo charged prevailing seed
prices, plus a share of the yield increase that growers experienced from Indigo products compared to
untreated seeds. Specifically, using farm-specific data, Indigo collected $10 per acre that registered
yield increases greater than 30 pounds of cotton lint per acre. Vice President of Product Management
Brett Boghigian explained,
rP
In agriculture, growers typically want to participate in a few years of field trials before
they decide whether to switch to new agricultural inputs or practices because they assume
all of the risk if they don’t work well. Our pricing structure de-risked customer acquisition
by removing that barrier, and was instrumental in growing our commercial scale from 0
to nearly 60,000 acres in a matter of months. Understanding and removing customer
barriers to adoption drives our organization and has led to a greater willingness to try our
yo
products.
Indigo deployed its agronomic advisors to visit its microbial product customers several times per
season in order to provide advice on how they could improve their yields and profits. In particular,
these advisors provided recommendations on seed selection, fertility planning, quality testing and
profiling, yield monitoring, and controlling disease, insects, and weeds. The advisors also collected soil
and crop data and aggregated it onto a data platform used to improve Indigo’s seed technology and
agronomy advice. Chief Strategy Officer Eric Jeck believed these close relationships that Indigo had
op
developed with farmers helped Indigo collect better data. He said, “Farmers aren’t just going to give
their data to anyone. You need to establish a different relationship with the grower, a direct
relationship, a trusted relationship.”
The company continued to expand its commercial presence and test new microbial strains. Its
microbial products were on over four million acres globally in 2019. Indigo had earned more than 50
patents for its microbe products that spanned barley, corn, cotton, oats, rice, soy, and wheat, available
tC
in the US, Brazil, Argentina, and Australia. Microbiome coatings were increasing cotton yields by 14%,
wheat by 13%, soybeans by 9%, rice by 7%, and corn by 6%. The microbial coatings under development
targeted a broad range of stresses including: (1) resilience under water stress, allowing the plant to use
water more efficiently; (2) resilience under nutrient stress, allowing the plant to be more efficient and
better use available nutrients to perform; and (3) resilience under fungal disease. Indigo perceived the
total addressable market as nearly $60 billion worldwide, and about $30 billion in countries it was
planning to target by 2023: U.S., Argentina, Australia, Brazil, Canada, Spain, France, Germany,
No
Hungary, India, Mexico, Turkey, Ukraine, and South Africa. To date, Indigo’s microbial coatings
addressed nutrient use efficiency and/or water use efficiency, but Indigo planned to launch products
that addressed early seedling disease as well.
Indigo Marketplace
Through developing and selling its microbe products, Indigo gained a better understanding of the
agriculture industry and began identifying new challenges and opportunities. Raymond said, “Every
stone we overturned while researching and commercializing our microbial products, we learned that
Do
other aspects of agriculture—beyond inputs—needed innovation as well.”
Indigo leadership believed that the agricultural supply chain—designed to leverage economies of
scale by consolidating crops and transporting them from farmers to centralized distribution centers
and then to large food processors—was particularly ripe for disruption. Raymond explained:
t
os
Growers traded, as they had for decades, in one-off transactions primarily over the
phone. Identity preservation is difficult across the industry because of consolidation: a
grain elevator might consolidate several sources of grain and when it gets loaded onto a
truck you’ve lost any ability to track the grain’s origin. If you look at the ABCDs, they
have spent billions of dollars on consolidating grain and organizing around moving it in
mass. We saw opportunity in creating a digital platform that would enable growers to
rP
connect directly with buyers, and move away from a commoditized system.
Perry explained, “We knew microbiology was a cornerstone to changing agriculture but it couldn’t
do it by itself.”35 In particular, buyers sourcing grain directly from growers had long been a challenge
in agriculture. In June 2018, Indigo decided to explore creating an online platform that would connect
growers to buyers, which they called Indigo Marketplace, via a bootstrap effort. As Raymond recalled:
David wanted us all to think about Marketplace as a concept and then do what we
yo
always do at Indigo: study intensely. Once we settled on our goal to de-commoditize the
supply chain, we used resources from across the company—software engineers, product
management, sales; we brought in people with relationships on the buyer’s side. The
process was hugely cross functional and we met daily, all while still running our regular
microbial product business operations.
Indigo Marketplace launched in September 2018. The supply side—growers—registered and

op
entered crop information into the online platform. According to Raymond, “Using the sales team that
brought growers our microbiome products, we leveraged these existing relationships to communicate
the value to growers of adding their inventory to the supply side, which required significant cross
training to develop the appropriate sales skills.” She added, “Identity preservation has been achieved
with boots on the ground at the farm. We know when a grower is using our agronomic services as well
as our microbiome products. Indigo representatives are on the farm eight to ten times a year, getting
all the information needed about soil composition and farming practices.” To encourage growers to
tC
participate, Indigo’s salesforce visited many farms. Each of the 90 Grower Account Managers
conducted 350 to 675 visits per year to 100 to 200 farms.
On the demand side, buyers created a profile of product types in which they were interested, listing
grain type and price specifications. Raymond noted, “We also built out a new inside sales team that
specialized in pitching buyers from different verticals—processors and grain elevators. f Each had
specific requirements that we used to sell the Marketplace value proposition.”
No
The Indigo Marketplace web-based platform facilitated the matching of buyers’ bids and growers’
offers. Growers set a radius of how far away they would be willing to connect with buyers, who in turn
selected growers based on distance, product type, and price. Indigo launched Marketplace using a
freemium model: the base service was free to users with an option to pay Indigo for additional services,
such as the ability to bid on specialty crop varieties.
Marketplace could provide several benefits. According to von Maltzahn, “Marketplace connects
consumer demand with the decisions made on farms across our food system. This becomes even more
powerful as companies like Amazon and Whole Foods bring the grocery store online, providing a
Do
greater opportunity for customization and the ability to trace products all the way back to how they
were farmed,” in contrast to conventional supply chains that mixed crops grown on different farms
f Processors bought high volumes of food ingredients to manufacture food products. Grain elevators described the organizations
that operated grain elevator complexes, responsible for receiving grain and depositing them into storage facilities, typically a
silo.
t
os
and under different conditions. Growers benefited from pricing transparency, and buyers had the
ability to source products based on unusual details. “For example, in the future you can imagine
customers clicking a button to ensure all their groceries are carbon-negative, meaning their production
sequestered more carbon than was emitted,” von Maltzahn explained. Indigo Marketplace’s business
model was built on the assumption that an online grain platform would create value through
increasing operational efficiencies for key stakeholders in the grain market. It also rested on the
rP
assumptions that traceability would create value and that enough buyers and sellers were willing to
embrace change. As Perry noted, “As long as food is treated like a commodity, then farmers don’t get
paid for quality and production methods that embrace sustainability.” Perry added, “So, what you see
now is what you would expect to see—farmers focus pretty much exclusively on volume because that
is what they get paid for.”36
Indigo’s GeoInnovation team could also incorporate Marketplace data on crop production and
yo
grain marketing to enhance their prediction models. By identifying anomalies in regional agricultural
supply levels compared to historic norms, Indigo could predict local crop pricing dynamics and
highlight potential transportation issues. By applying machine learning techniques to satellite image
data, the team provided agricultural yield predictions to farmers, grain advisers, and grain buyers to
help them make better-informed crop selling and buying decisions at the more local and regional levels.
These efforts improved Indigo’s microbiome product recommendation algorithm for growers
purchasing Indigo microbiome products and selling grain on Marketplace. Von Maltzahn said, “We
imagine the combination of satellite data and machine learning providing year-round insights to
op
growers—taking trillions of data points from the past and present and using them to make better
decisions for the future of their farms.”
Comparing Marketplace to competing digitalization initiatives in agricultural, Raymond thought

Indigo’s broader scale and scope provided a significant competitive advantage, noting “There are other
digital agronomy companies, but many are smaller and much more geographically limited, focused on
tC
a specific crop or geography. In addition to our satellite data, we have the ability to be on the ground
across millions of acres.”
Indigo Transport
Because Indigo Marketplace offered buyers the ability to order directly from individual growers,
some of the purchased grains would not flow through traditional commodity-based agriculture supply
No
chains. Instead, a different transportation network would be required. Soon after the launch,
transportation logistics became a clear pain point. “Every bushel of grain produced today moves by
truck at least once before arriving at its destination,” Perry added. “This means grain transportation is
crucial to the success of our food system. But inefficiencies in the overall process—including
communication, reliability, and availability—are bad for growers, buyers, and the environment.” 37
In January 2019, Indigo launched Indigo Transport to manage the pickup, transportation, and drop-
off of grains between grower and buyer. Indigo did not own any transportation assets, and instead
contracted with transportation carriers and enabled growers on the Marketplace platform with
commercial trucks licenses to operate as carriers. Raymond explained, “We utilize existing
Do
transportation infrastructure.” Once carriers enrolled in Indigo Transport, the platform allowed them
to select loads that best fit their route and operation. Growers could choose between carriers, and some
growers might choose to use their own trucks that were not otherwise highly utilized. Indigo’s software
matched loads to carrier preferences, managed payment, and offered live customer support for users.
“Consistency is the biggest issue today for agricultural transport—we need steady work,” said one
hauler. 38 Anyone on the Indigo Marketplace platform could use Indigo Transport. Indigo spent the
t
os
months between the Marketplace launch and the Transport launch building a network of carriers.
Raymond said, “We used the first few months of Marketplace to essentially pilot Transport. We pushed
to critical mass in eight different regions that had a lot of growers and buyers and built our supply
network from there.”
Transportation fees were based on route distance and order size. Indigo’s sales team coordinated
rP
with growers, carriers, and buyers to arrange delivery and backhaul. Raymond added, “Our
DataInnovation team also drives the software behind route and delivery optimization. We want to
ensure trucks are never empty. If there is a one-way delivery, we want the driver to have a backhaul,
which can extend beyond grain or seed to fertilizer or other agricultural products coming from the
initial drop-off site.”
Promising Uptake
yo
As Raymond recalled, “We began 2019 with $1.4 billion of buyer demand and considered an end-
of-year result of $10 billion to be a lofty target.” Demand far exceeded their expectations. By May 2019,
Indigo Marketplace listed over $11 billion of inventory by more than 7,000 growers, and had received
$34 billion in bids from more than 4,500 buyers. By May 2019, just 11 months since launch, Marketplace
listed $5 billion in active buyer bids. (See Exhibit 12 for Indigo Marketplace adoption trends.) Raymond
summarized the situation, “That level of demand exceeded our expectations. We continue to be focused
op
on achieving critical mass in both supply and demand that will match net of transportation at attractive
market clearing prices. As both supply and demand have grown, not surprisingly, we have seen a
significant uptick in Marketplace transactions.”
In March 2019, Indigo announced a deal committing it to deliver 2.2 million bushels of Indigo Rice™
grown with specific environmental attributes to Anheuser-Busch, the U.S.’s largest brewer. Indigo
would contract with rice growers who agreed to reduce water and nitrogen use by 10% and reduce
tC
greenhouse gas emissions by 10% compared to state benchmarks. Raymond added, “Marketplace
enables us to trace the rice from the farm to Anheuser-Busch’s mills. Account managers work with
growers to select seed options that improve yield, sustainability, and profit, and all of this meets the
beer consumer demand for sustainability.” Anheuser-Busch would pay a price premium to these rice
suppliers. Perry said, “With our cutting-edge microbial tools, agronomic support, and digital
innovations, combined with the market premium enabled by Anheuser-Busch, growers working with
Indigo can expect to earn an additional $30 to $60 per acre.” 39 Rough estimates suggested that would
No
amount to a 4% to 8% price premium. g
Growing Agronomy Expertise

In late 2018, Indigo acquired the agriculture satellite imaging company TellusLabs, which became
Indigo’s GeoInnovation team. They used satellite images and proprietary software to make yield
predictions on farming operations around the world, based in part on growers’ production history over
the past decade and their current operations. Indigo added more-granular information to their models
based on the company’s commercial efforts, including knowledge its agronomy team was learning
Do
about some growers’ farming practices and their manually-collected samples on customers’ land. As
a result, von Maltzahn explained, “a farmer looking to grow his or her best crop can receive
personalized data and recommendations that change the course of a growing season for the better.” 40
g This calculation assumes a farm produces 160 bushel (7,200 pounds) of rice per acre and sells rice at $5 per bushel.
10
t
os
Indigo’s predictive models now integrated satellite imagery, crop and soil samples, and Indigo
Marketplace activity, and could inform growers about when to harvest and what prices to expect. These
models were also enhancing Indigo’s ability to offer data-driven agronomy advice to growers to help
increase their profits. For example, through assessments of agronomic and environmental conditions,
Indigo was improving its ability to predict the areas in which each of its microbial products were likely
to perform better, to assess their performance under actual growing conditions, and to help growers
rP
improve their crop and soil health. By remotely monitoring fields through satellite imagery and other
data, Indigo sought to monitor crop production risk, which could decrease growers’ costs of
agricultural financing and insurance products. And by identifying which areas of a grower’s fields
were likely to exhibit higher quality characteristics, Indigo sought to help farmers design harvest plans
to segregate high-quality areas to enable them to realize quality premiums and avoid inadvertently
mixing their higher and lower quality crops.
yo
A Proposal: The Terraton Initiative
As Indigo gained experience working with growers to develop and refine its microbiome-coated
seeds, and operating Indigo Marketplace and Indigo Transport, other challenges and opportunities in
agriculture were becoming evident. The Indigo team wondered whether they could incentivize the
widespread deployment of regenerative agricultural practices—techniques such as the use of cover
crops, crop rotation, and no-till that used photosynthesis to increase carbon in soils by drawing CO2
op
from the atmosphere. Perry believed that sequestering carbon in agricultural lands via regenerative
farming was among the cheapest ways to reduce greenhouse gas concentrations in the atmosphere. A
2019 report from the National Academies of Sciences, Engineering, and Medicine listed agricultural
carbon sequestration among the safest and most economical carbon sequestration methods. 41 As Perry
noted, “Among all the potential solutions to reduce the effect of climate change and reverse it,
sequestering carbon into agricultural soils is the only solution I know of that is scalable, economical,
tC
and immediate.”
Scaling such practices could make serious inroads to addressing climate change. While
implementation would be tough, the idea was simple enough: find growers who were willing to learn
about and deploy regenerative agricultural practices and agree to have agricultural soil carbon
measured to assess how much carbon was being sequestered, record those gains by creating tradeable
carbon credits, and then sell the carbon credits to willing buyers on a carbon exchange that Indigo
would create and operate.
No
Von Maltzahn characterized the idea and market opportunity:
Through the process of photosynthesis, agricultural plants have the ability to

economically pull more carbon dioxide out of the atmosphere than any other technology.
Look at the 99% scientific consensus that global warming is caused by the teraton of excess
carbon dioxide in the atmosphere. The technologies to remove that carbon cost between
$20 and $1000 per ton today. This implies that within 30 years there is likely to be a $20+
trillion market for carbon dioxide removal that will be existential to society. This makes
climate change perhaps the most important challenge and new market opportunity of this
Do
century.
Perry explained that Indigo could set an ambitious goal to sequester in soils the “one trillion tons
of carbon dioxide in the atmosphere today that wasn’t in the atmosphere prior to humans starting to
burn coal and oil,” 42 and that it could achieve this by tripling the carbon content of soil on every
cultivated acre on earth from their current 1% levels to a 3% level that is typical in many natural
11
t
os
habitats. “One trillion tons of carbon dioxide represents both the scale of the problem, and the scale of
the potential solution,” according to Perry.
The idea—tentatively coined the Terraton Initiative by leadership to capture this ambitious goal—
was a form of geoengineering, defined as “the deliberate large-scale intervention in the Earth’s natural
systems to counteract climate change” and included efforts to shade the earth from solar radiation and
rP
to remove more greenhouse gases from the atmosphere than nature was currently achieving. 43
However, many farmers were unfamiliar with regenerative agricultural practices and were
reluctant to abandon the modern agricultural technologies that had substantially increased crop yields.
The transition costs, impacts on yield, and financial returns remained unclear. Moreover, some farmers
were skeptical that climate change was due to human activity and thus did not feel compelled to take
action to address it. 44 Additionally, modern agriculture only accounted for about 20% of the one trillion
tons (200 gigatons) of CO2 released into the atmosphere since industrialization. Some scientists were
yo
skeptical about whether the teraton goal was achievable, citing carbon sequestration analyses that
suggested such efforts might only recover 50% to 60% of the one trillion tons of CO2 in the
atmosphere. 45 Perry disputed such arguments, saying:
[The] argument is based on two premises, neither of which we know to be true. The
first is that you can accurately estimate how much carbon has been lost from the soil, and
that’s really hard. The second [argument is] that you can’t put more carbon back into the
op
soil than was there to begin with, and I think we can say with a lot of confidence that’s
not true. There’s no reason to think that nature was looking to maximize carbon in the
soil. 46
Launching the Terraton Initiative would likely require more than 200 Indigo employees to work
full or part time on it immediately. Other startup expenses were estimated to include $25 million to
purchase soil sampling equipment and $10 million to engage potential buyers. Leadership’s vision was
tC
developing a carbon market platform and launching several efforts to accelerate knowledge about
regenerative practices.
A New Carbon Market Platform

Leadership believed a two-sided, verifiable marketplace—which they could brand as Indigo
Carbon—would be key in progressing towards one trillion tons of sequestered carbon. Indigo Carbon
would bring together buyers and sellers of carbon credits, generated by growers who had implemented
No
regenerative farming practices and thereby sequestered carbon from the atmosphere (see Exhibit 13
for how growers and buyers would join Indigo Carbon). It would be built on the same data platform
as Indigo’s other businesses, but a new app was needed to track data from the soil samples that would
be collected on millions of acres.
Carbon Credits Indigo would use its digital agronomy capabilities and satellite imagery
analysis to measure and verify soil carbon sequestration and on-farm emission levels, awarding carbon
credits for each ton of carbon sequestered or abated. Indigo could trace each carbon credit back to the
field it came from. Head of Indigo Carbon Ed Smith explained, “We can sell a bushel of wheat with
Do
carbon credits tied directly to that individual bushel’s sustainability.” He emphasized the importance
of data collection, “A carbon credit is fundamentally a data product and only as good as the data saying
how much carbon you’ve taken out of the air.”
Spurring Supply Indigo envisioned growers signing onto the platform to provide data and soil
samples that would be analyzed to assess carbon content. Supported by Indigo-provided agronomic
12
t
os
advice, the grower would then adopt regenerative practices and/or use less fertilizer and other
agricultural inputs—sometimes enabled by the use of Indigo’s microbiome-coated seeds. Indigo
would then collect additional data to verify the tons of carbon sequestered or abated, and the grower
would receive payment for the market value of carbon credits, and Indigo would earn a fee.
Eventually, the price of carbon credits would be set by supply and demand. To encourage early
rP
adoption, Indigo decided to set a minimum carbon credit price of $15 per metric ton of CO2 sequestered
for growers who agreed to participate within the first calendar year of Terraton’s launch. Indigo
predicted that carbon credit sales revenue, at $15 to $20 per ton, could yield growers with $30 to $45
per acre each year, which would more than offset their transition costs to adopt regenerative practices.
This second revenue stream could enable some growers to double their income per acre. Some growers
also recognized regenerative farming’s potential for long-term benefits to their fields.
Many other companies’ prior attempts to digitalize agriculture had failed due to growers’
yo
unwillingness to share farm data. Raymond noted that such “hesitance is driven by a belief that sharing
data won’t provide any benefit to the grower, and in fact might harm them. Indigo Carbon would
collect data in order to get the grower paid for sequestering carbon in the soil, which would provide
an entirely new revenue stream for them.”
Spurring Demand Indigo foresaw several types of buyers of these carbon credits: consumers,
businesses, nongovernmental organizations (NGOs, or non-profits) and foundations. Perry observed,
op
“Many people discount the role of consumers in this, but we think there is significant change
underway, where consumers are increasingly aware of the climate change problem, and increasingly
have a sense of urgency and willingness to contribute to solutions.” If there was consumer demand,
the theory was that this would drive businesses to demand more sustainable ingredients. Raymond
provided an example, “A food company might want to buy sustainable rice grown with 10% less
synthetic nitrogen fertilizer on acres with regenerative farming practices.” Indigo thought Terraton
could be especially well suited to this challenge because, as Smith noted, “For all your food-related
tC
companies, namely major retailers and consumer packaged goods companies, when they think about
reducing environmental footprint, a major challenge is lost visibility looking back through the supply
chain.” Informing consumers that a product had a lower carbon footprint, however, would be a
challenge, especially given competing interests for precious space on product labels. In exploring the
Terraton Initiative, Indigo considered creating Terraton labels for end-consumer packaging.
Perry described several other types of potential buyers of Terraton-generated carbon credits:
No
Businesses would play an important role; in supporting Terraton certification,

offsetting their own emissions, and driving solutions that make sense at a reasonable
price. There are not-for-profits and foundations that are looking to contribute to effective
climate change solutions. And then of course governments would play a key role, in both
establishing regulations that are consistent with this, and perhaps things like implanting
carbon taxes and or cap and trade systems.
Regulations that imposed a price on carbon or created other incentives for companies to reduce
their carbon impact could substantially increase demand for low-cost quality-verified carbon credits,
Do
the very type Indigo saw potential to generate.
Measuring Carbon Dioxide Sequestered Creating credible carbon credits that could be
bought and sold would require new approaches to measure and verify how much carbon was actually
being sequestered by growers engaging in regenerative agricultural practices. Raymond explained the
company’s thinking:
13
t
os
We would leverage soil sampling, coupled with soil biogeochemical modeling, to
quantify changes in soil carbon and greenhouse gas emissions at the field level. We would
pursue a grouped project approach that stratifies growers by their practices and
environmental conditions, and allow us to efficiently sample a subset of growers’ acres in
our project. The cost of that approach would start around $5 per ton for soil sampling,
modeling data collection and verification.
rP
Indigo’s GeoInnovation team was developing models to evaluate soil content and conditions
remotely based on electromagnetic reflectance measures, which could dramatically reduce monitoring
costs, which otherwise required manual soil sampling and testing. Indigo expected that its work to
integrate remote sensing with its increasing datasets—of grower practices, soil samples, and satellite
imagery—would increase the accuracy of its machine learning algorithms that predicted soil content,
and enable Indigo to sample fewer acres. Indigo expected this to drive down the costs of soil analysis,
yo
including assessing carbon content in soils. As a result, Indigo expected verification costs could fall.
Perry noted, “We believe we’ve figured out how to lower costs using a combination of remote sensing h
from satellites and modeling, and we now have the technology to get cost down to $5 a ton, and we
see a line of sight to have it less than $1 a ton in the next 24 months.”
Regenerative Agricultural Practices

Five regenerative practices had been proven to develop carbon-enriched soils: rotating crops,
op
planting cover crops, using no-till practices, reducing the use of fertilizers and other chemical inputs,
and incorporating livestock. In researching the efficacy of a program like the Terraton Initiative, Indigo
often referred to the experience of Gabe Brown, a North Dakota farmer, who began deploying
regenerative practices more than twenty years ago, and has more than tripled the carbon content in his
soils from about 1% to over 3.5%. (See Exhibit 14 for details on Brown’s regenerative farming practices.)
Perry argued, “If every farm on earth, the 3.6 billion cultivated acres, were to do what Gabe has done,
tC
we would capture over one trillion tons of CO2 out of the atmosphere and back into the soil.” Such
widespread diffusion represented a huge opportunity, but also an enormous challenge given estimates
that only a few percent of farmers in the U.S. used multiple regenerative farming practices as of 2019,
according to von Maltzahn. He added, “Many farmers are interested but don’t know how to act.”
Brown, widely known to be a farmer at the forefront of the regenerative agriculture movement,
believed there was no “silver bullet” among regenerative practices. 47
Indigo agronomists had experience advising farmers based on its microbiome seed business, and
No
could also be trained to advise on regenerative practices. Perry noted, “Our agronomists could support
data-based decision-making throughout the season to optimize the implementation of regenerative
practices for soil health, water conservation, and improved farm margins.” 48 However, the multi-
faceted approach to regenerative farming had potential to complicate its practice.
Developing the Science of Regenerative Agriculture

Like Indigo, Brown saw the adoption of regenerative agricultural practices as a challenge. “Any
time we can put dollars in producers’ pockets is good,” he said. “But the big question I have that I have
Do
to be convinced about is who’s going to steer producers down this regenerative path? You’ve gotta
hold their hands a bit.”49 Von Maltzahn recognized the issue too, noting, “We would need to be able
to show farmers expected balance sheets several years down the line. We think that regenerative
practices have sometimes hurt the balance sheet in the first few years while farmers figured out what
h Remote sensing referred to obtaining information about the earth by scanning it from satellites or aircraft.
14
t
os
does and doesn’t work in practice, and once they do, it becomes much more profitable than
conventional agriculture.” Smith added, “If farmers knew how to do it, they would be doing it already.
There is a playbook for conventional practices, but not regenerative practices. We are in the process of
building a decision algorithm, but until we get to a point where we have historical data, practices will
remain somewhat vague.” Von Maltzahn explained the scope of what Indigo would need to learn, “We
would need to understand the total amount of cover crop, what machinery is needed, and how to make
rP
machinery available among growers. We would have to be in constant communication with
regenerative farmers asking them ‘Why?’ over and over and over again.” Indigo’s Terraton Challenge,
Terraton Experiment, and Carbon Cup, the other three components of the Terraton Initiative being
considered—were meant to try to accelerate the science of regenerative agricultural practices.
Crowd-sourced Competitions Indigo could create crowd-sourced competitions to encourage

innovators to develop critical enablers of the Terraton Initiative. For example, a competition could
yo
encourage a competition of technologies to accelerate soil carbon sequestration, and methods to more
inexpensively measure soil carbon. Entries could be judged on their innovativeness, potential impact,
and potential for grower acceptance. Awards could include access to Indigo staff to help run pilot tests
on research acres, support to promote their ideas at trade conferences, and grants to accelerate their
work. The inventors would maintain their business independence and intellectual property rights. As
von Maltzahn explained,
We would want this to serve as a jumping off point for all beneficial agriculture
op
challenges, designed for innovators from anywhere in the world that are compelled by
specific problem statements throughout agriculture. We want as many innovators as
possible focused on agriculture because part of our central thesis is that if you can deploy
multiple novel solutions simultaneously, you can change the entire system.
Experiments Indigo could also foster experiments to investigate the effectiveness of

regenerative agricultural practices such as reduced tillage, rotation, and cover cropping, and to explore
tC
how their effectiveness in enriching soil carbon varied across crops, soil types, and regions. Indigo saw
potential to leverage partnerships to analyze soil on tens of thousands of farms for a decade,
continuously measuring their carbon levels and other soil health metrics and farming practices. This
might enable Indigo to learn how to create customized plans for growers to facilitate their transition
from regenerative practices. Experiments might answer questions such as: What processes maximize
soil carbon and the rate of absorption? What microbes are correlated with carbon sequestration? How
do carbon-enriched soils impact farm profitability? How much do soil carbon levels contribute to
No
improved drought and flood resilience? To what degree do healthier soils produce healthier crops?
A Carbon Cup Just as the U.S.-based National Corn Growers Association held contests that
awarded corn growers with the highest corn yields, Indigo could launch a series of state-level
competitions that would award a “Carbon Cup” to growers whose soil either had the highest carbon
content or had most increased their carbon content.
Agriculture’s Future Beyond Indigo

Do
It was unusually chilly that May 2019 afternoon as Perry and von Maltzahn continued their
conversation. They believed the Terraton Initiative, an extension of agriculture at large, could make a
huge impact addressing climate change. Perry noted, “It’s probable that agriculture has been trying to
defy natural forces for the last 70 to 100 years. We have the opportunity to align with natural forces,
change the practices of farming, and change the course of the planet in the process.” Von Maltzahn
said, “Climate change is fascinating in that it is going to affect everyone, yet the number of people who
15
t
os
believe their imagination can make a difference is tiny. Agriculture represents a platform to draw upon
the creativity and effort of the billion people working in our food system to leverage change.” Raymond
added, “Agriculture has tremendous potential to change the world for a better place. In the future, I
think people can see running a farm like running their own business as the CEO; imagine a future
where people speculate on their career saying, ‘I want to be doctor, a lawyer, or a farmer.’”
rP
However, the Terraton Initiative posed organizational challenges, and because leadership remained
steadfast in their belief that climate change required ambitious action, they recognized the cost of
failure. The Terraton Initiative would inevitably put strain on Indigo’s microbiome product business
and its Indigo Marketplace platform. They wondered, was Indigo the right organization to lead the
charge? And what of their daunting target—the sequestration of one trillion atmospheric tons of carbon
back into the soil? In their effort to reach such a target, would they miss an opportunity to address
climate change in more manageable, and in turn potentially more impactful, ways?
yo
op
tC
No
Do
16
t
os
Exhibit 1 Number of U.S. Farms, 1910–2013
rP
yo
op
Source: Robert A. Hoppe, “Structure and Finances of U.S. Farms: Family Farm Report, 2014 Edition,” USDA Economic
Research Service, December 2014, http://www.ers.usda.gov/media/1728096/eib-132.pdf, accessed September 2016.
tC
Exhibit 2 Percent of U.S. farms, Acres Operated, and Value of Production by Farm Type, 2011
No
Source: Adapted from Robert A. Hoppe, “Structure and Finances of U.S. Farms: Family Farm Report, 2014 Edition,” USDA
Economic Research Service, December 2014, http://www.ers.usda.gov/media/1728096/eib-132.pdf, accessed
September 2016.
Do
17
t
os
Exhibit 3 Top U.S. Crops by Value of Production, in $ billions, 2013–2015
Crop 2013 2014 2015

Corn 61.9 52.9 49.0
Soybeans 43.6 39.5 34.5
rP
Wheat (all) 14.6 11.9 10.2
Alfalfa (Hay type) 10.7 10.6 8.7
Hay other 9.1 8.5 8.1
Cotton (all) 5.1 5.1 3.9
Potatoes 4.2 3.9 3.8
Rice 3.1 3.1 2.6
yo
Sorghum for grain 1.7 1.7 2.1
Mushrooms 1.1 1.1 1.2
Source: Casewriter research; “Crop Values: 2015 Summary,” USDA National Agricultural Statistics Service, February
2016, http://usda.mannlib.cornell.edu/usda/current/CropValuSu/CropValuSu-02-24-2016.pdf, accessed
September 2016.
op
Exhibit 4 Historical Worldwide Cereal Yield and Annual Percent Change, 1960–2015
tC
No
Do
Source: Compiled from “Cereal yield (kg per hectare),” The World Bank, http://data.worldbank.org/, accessed October 2016.
Note: Cereal yield, measured as kilograms per hectare of harvested land, included wheat, rice, maize, barley, oats, rye, millet,
sorghum, buckwheat, and mixed grains. Production data on cereals relate to crops harvested for dry grain only. Cereal
crops harvested for hay or harvested green for food, feed, or silage and those used for grazing are excluded. The Food
and Agriculture Organization of the United Nations allocates production data to the calendar year in which the bulk
of the harvest took place. Most of a crop harvested near the end of a year will be used in the following year.
18
t
os
Exhibit 5 McKinsey Global Institute’s Industry Digitalization Index
rP
yo
op
tC
No
Source: “Digital America: A tale of the haves and have-mores,” December 2015, McKinsey Global Institute,
Do
www.mckinsey.com. Copyright © 2020 McKinsey & Company. All rights reserved. Reprinted by permission.
Notes: 1) Based on a set of metrics to assess digitalization of assets (8 metrics), usage (11 metrics), and labor (8 metrics); see
technical appendix for full list of metrics and explanation of methodology. 2) Compound annual growth rate.
19
t
os
Exhibit 6 Carbon Cycle Diagram
rP
yo
op
tC
No
Source: “The Carbon Cycle,” PMEL Carbon Program, National Oceanic and Atmospheric Administration (NOAA) website,
https://bit.ly/2LuxuFe, provided by C. Sabine (NOAA/PMEL); from IPCC, 2013: Climate Change 2013: The Physical
Science Basis. Contribution of Working Group 1 to the Fifth Assessment Report of the Intergovernmental Panel on
Climate Change [Stocker, T.F., D. Qin, G.-K. Plattner, M. Tignor, S.K. Allen, J. Boschung, A. Nauels, Y. Xia, V. Bex and
P.M. Midgley (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA, p. 1535;
accessed December 2019.
Notes: Numbers represent reservoir mass, also called ‘carbon stocks’ in PgC (1 PgC = 1015 gC) and annual carbon exchange
fluxes (in PgC yr-1). Red numbers and arrows indicate flows and changes in reservoir sizes associated with human
activities. Black numbers and arrows indicate typical values prior to major human influence.
Do
20
t
os
Exhibit 7 History of Global Surface Temperature, 1880 – 2019
rP
yo
op
Source: Rebecca Lindsey, LuAnn Dahlman, “Climate Change: Global Temperature,” NOAA, climate.gov, September 19, 2019,
https://bit.ly/2bGmphJ, accessed October 2019.
Note: The zero line represented 13.9ºC, the average global surface temperature in the twentieth-century.
tC
No
Do
21
t
os
Exhibit 8a Projected Increase in Number of Days over 90ºF through 2090
rP
yo
Source: Environmental Protection Agency (EPA) report from “Climate Change and Agriculture: A Perfect Storm in Farm
Country,” Union of Concerned Scientists, March 20, 2019, https://bit.ly/3215cYy, accessed October 2019.
Notes: Adopted as a measurement tool by Intergovernmental Panel on Climate Change (IPCC), Representative Concentration
Pathways (RCP) projected alternative pathways for carbon dioxide emissions between 2000 and 2100. Numerical
values, 4.5 and 8.5, referred to carbon dioxide concentrations in 2100, and were labeled after a range of radiative forcing
values (the difference between insolation absorbed by the earth and energy radiated back into space).
“RCP 4.5” represented a more conservative climate change projection relative to the “RCP 8.5” projection.
op
Exhibit 8b Projected Increase in Maximum Daily Precipitation through 2090
tC
No
Source: Environmental Protection Agency (EPA) report from “Climate Change and Agriculture: A Perfect Storm in Farm
Country,” Union of Concerned Scientists, March 20, 2019, https://bit.ly/3215cYy, accessed October 2019.
Notes: Adopted as a measurement tool by Intergovernmental Panel on Climate Change (IPCC), Representative Concentration
Pathways (RCP) projected alternative pathways for carbon dioxide emissions between 2000 and 2100. Numerical
values, 4.5 and 8.5, referred to carbon dioxide concentrations in 2100, and were labeled after a range of radiative forcing
Do
values (the difference between insolation absorbed by the earth and energy radiated back into space).
“RCP 4.5” represented a more conservative climate change projection relative to the “RCP 8.5” projection.
22
t
os
Exhibit 8c Projected Change in Precipitation Levels in 2050
rP
yo
op
Source: Open Street Map contributors in Dipika Kadaba, “Interactive Map: Precipitation in the 2050s,” The Revelator, October
8, 2018, https://bit.ly/2KfxQPz, accessed October 2019. © OpenStreetMap contributors, © CARTO, licensed under
the Open Data Commons Open Database License (ODbL) by the OpenStreetMap Foundation (OSMF).
Note: mm = rain per square millimeter.

tC
Exhibit 8d Projected Impact of Climate Change on Yields of Corn, Wheat, Soybeans and Cotton by
the Years 2080-2099
No
Do
Source: Fourth National Climate Assessment, Figure 7.7 (Source data: Hsiang et al 2017) from “Climate Change and
Agriculture: A Perfect Storm in Farm Country,” Union of Concerned Scientists, March 20, 2019,
https://bit.ly/3215cYy, accessed October 2019.
23
t
os
Exhibit 8e Projected Relative Changes in Potential Yields Aggregated Across Crops between 2000
and 2100 due to Climate Change
rP
Source:
yo
GAEZ project under scenario SRES A1FI in Christophe Gouel, David Laborde, “The role of trade in adaptation to
climate change,” VOX CEPR Policy Portal, https://bit.ly/3789DVe, accessed November 2019.
op
Note: Red: -100% change; Orange: -50% change; Yellow: 0% change; Light Green: 50% change; Dark Green 100% change.
Exhibit 9 Forecasted Impact of Climate Change on U.S. Crop Production Volume, 2020–2080
2020 2040 2060 2080

tC
Barley (bushels) -1.9 -0.6 -3.5 1.0

Corn (bushels) -8.1 -8.7 -13.8 -16.2
Cotton (bales) -7.9 -6.1 -5.6 -5.9
Hay (dry ton) -4.0 -0.6 2.7 4.2
Oats (bushels) -8.7 -10.7 -16.1 -20.8
Rice (cwt) -2.2 -2.5 -4.2 -6.1
Silage (dry ton) -6.9 -9.5 -13.1 -14.4
Sorghum (bushels) -15.1 -5.4 -14.0 -17.0
No
Soybeans (bushels) -8.1 -8.8 -11.9 -14.3

Wheat (bushels) -2.8 1.3 5.6 11.6
Source: Elizabeth Marshall, Marcel Aillery, Scott Malcolm, and Ryan Williams, “Climate Change, Water Scarcity, and
Adaptation in the U.S. Fieldcrop Sector,” USDA Economic Research Service, November 2015,
https://www.ers.usda.gov/amber-waves/2015/november/climate-change-water-scarcity-and-adaptation/,
accessed December 2016.
Note: Percent changes in total U.S. production, averaged over future climate change scenarios and compared to reference
production levels that assume no climate change.
Do
24
t
os
Exhibit 10 Carbon Sequestration Alternatives
Scalable Affordable Immediate

Agriculture Potential for 1+ trillion $15-20 / ton CO2 stored, Farmer control of land.
tons of CO2 with increased farmer Means to make change.
profitability. System to harness
rP
collective efforts.
Trees Potential for ~700 billion $15-20 / ton CO2 stored, 76% of forest land not
tons of CO2 unknown opportunity controlled by individuals.
cost. No system to harness
collective effort today.
Oceans Potential for 1+ trillion Largely untested; still No scalable and
tons of CO2 high cost today. affordable solution yet
yo
developed.
Source: Casewriters compiled from company documents.

op
tC
No
Do
25
-26-
t
os
620-024
rP
yo
op
tC
No
Indigo Organizational Chart
Do Exhibit 11
t
os
Exhibit 12 Indigo Marketplace Adoption: Value of Active Bids Submitted and Cumulative Enrolled
Growers from June 2018 to May 2019
rP
yo
op
tC
Exhibit 13 The Proposed Indigo Carbon Market Platform
1. Growers enroll in Indigo’s carbon credit program.

2. Indigo establishes baseline.
3. Indigo supports farmer in transitioning to regenerative practices.
No
4. Indigo gathers data manually and automatically.

5. Indigo algorithm processes data to quantify GHG abatement and soil carbon sequestration.
6. Credits are verified and validated.
7. Indigo sells credits.
8. Indigo transfers value of credit to grower.
Source: Company documents.

Do
27
620-024 -28-
Exhibit 14 Regenerative Practices and Soil Carbon at North Dakota Farm of Gabe Brown
Do
No
tC
op
Source: Company documents from Gabe Brown, Dirt to Soil, 2018; Gabe Brown, Regeneration of Our Lands: A Producer’s Perspective, TEDx Talk, 2016.
Notes: “Cash crops” were produced for commercial purposes, rather than for use by the grower. “Tillage” referred to the preparation of land for growing crops, such as digging,
yo
turning, and stirring soil. “Cover crops” included crops grown for the protection of soil and examples included brassicas, grasses, and legumes. “Holistic livestock integration”
described integration of livestock production with crop production for sustainability-driven purposes. “Pollinator strips” attracted insects otherwise driven away by insecticide
application.
rP
os
t
620-024 -29-
t
os
Endnotes
1 Charlie Mitchell and New Food Economy, “How an ag company most people have never heard of could prove itself more
disruptive than Netflix or Airbnb,” The New Food Economy, May 30, 2019, https://bit.ly/2m7MGOM, accessed September
2019.
rP
2 “Meet the 2019 CNBC Disruptor 50 companies,” CNBC, May 15, 2019, https://cnb.cx/2YwjsH8, accessed September 2019.
3 “Ag and Food Statistics: Charting the Essentials,” USDA Economic Research Service, 2016, https://bit.ly/2pIy2jj, accessed
September 2016.
4 “Ag and Food Sectors and the Economy,” USDA Economic Research Service, 2016.
5 “Ag and Food Sectors and the Economy,” USDA Economic Research Service, 2016.
yo
6 “The number of farms has leveled off at about 2.1 million,” USDA Economic Research Service, 2015, https://bit.ly/37yBKNE,
accessed September 2016.
7 “The number of farms has leveled off at about 2.1 million,” USDA Economic Research Service, 2015.
8 Robert A. Hoppe, “Structure and Finances of U.S. Farms: Family Farm Report, 2014 Edition,” USDA Department of
Agriculture, https://www.ers.usda.gov/publications/pub-details/?pubid=43916 accessed March 2017.
9 Hoppe, “Structure and Finances of U.S. Farms: Family Farm Report, 2014 Edition.”
10 Jayson Lusk, “Why Industrial Farms Are Good for the Environment,” New York Times, September 23, 2016,
op
https://nyti.ms/2QIqgRC, accessed September 2016.
11 “Agricultural Production and Prices,” USDA Economic Research Service, https://bit.ly/2XC6UPk, accessed September
2016.
12 “Agricultural Production and Prices,” USDA Economic Research Service.
13 “Crop Values 2016 Summary,” USDA National Agricultural Statistics Service, February 2016, https://bit.ly/37tLM2d,
accessed September 2016.
tC
14 KPMG, “The agricultural and food value chain: Entering a new era of cooperation,” p. 5, https://bit.ly/2kSpFPG, accessed
September 2019.
15 Adam Putz, “The ABCDs and M&A: Putting 90% of the global grain supply in fewer hands,” PitchBook, February 21, 2018,
https://bit.ly/2mitr59, accessed September 2019.
16 McKinsey Global Institute, “Digital America: A Tale of the Haves and Have-Mores,” December 2015, p. 5 from BEA, BLS,
U.S. Census; IDC: Gartner; McKinsey social technology survey; McKinsey Payments Map; LiveChat customer satisfaction
report; Appbrain; U.S. contact center decision-markers guide; eMarketer; Bluewolf; Computer Economics; industry expert
No
interviews; McKinsey Global Institute analysis, accessed October 2019.

17 Todd Janzen, “Do Farmers Still Care About Ag Data Privacy,” Precision Farming Dealer, February 2, 2019,
https://bit.ly/2kuQZ6w, accessed September 2019.
18 The Economist, “The Future of Agriculture,” Technology Quarterly, June 9, 2016, https://econ.st/2JTYxWO, accessed
September 2019.
19 The Economist, “The Future of Agriculture.”
20 John Deere, “MyJohnDeere,” https://bit.ly/2NoOc9k, accessed October 2019.

Do
21 Project Drawdown, “Food: Sector Summary,” https://www.drawdown.org/solutions/food, accessed November 2019.
22 Food and Agriculture Organization of the United Nations, Climate Change, Agriculture and Food Security: The State of Food and
Agriculture (Kiroka, United Republic of Tanzania, 2016), page 74; http://www.fao.org/publications/sofa/2016/en/ accessed
November 2019.
23 “Key facts and findings: By the numbers: GHG emissions by livestock,” Food and Agriculture Organization of the United
Nations, https://bit.ly/36hez9L, accessed October 2019.
29
620-024 -30-
t
os
24 Jonathan Foley, “A Five-Step Plan to Feed the World,” National Geographic, May 2014
https://www.nationalgeographic.com/foodfeatures/feeding-9-billion, accessed October 2019.
25 John Carey, “Global Warming and the Science of Extreme Weather,” Scientific American, June 29, 2011,
rP
https://bit.ly/321uMwk; Rebecca Lindsey and LuAnn Dahlman, “Climate Change: Global Temperature,” NOAA,
climate.gov, September 19, 2019, https://bit.ly/2bGmphJ, both accessed October 2019.
26 Elizabeth Marshall et al., “Climate Change, Water Scarcity, and Adaptation in the U.S. Fieldcrop Sector,” November 2015, p.
8.
27 Rebecca Duff and Michael J. Lenox, “PATH TO 2060: Decarbonizing the Agriculture Industry--Innovation’s Role in
Sustainable Growth,” Batten Report: Improving the World Through Entrepreneurship and Innovation. University of Virginia,
Darden School of Business, August 2019, https://at.virginia.edu/33926Co, accessed October 2019.
Rebecca Lindsey, LuAnn Dahlman, “Climate Change: Global Temperature,” NOAA, climate.gov, September 19, 2019,
yo
https://bit.ly/2bGmphJ, accessed October 2019.
28 This section draws heavily from Marco Iansiti, Michael W. Toffel, and Christine Snively, “Indigo Agriculture,” HBS No. 617-
020 (Boston: Harvard Business School Publishing, 2018).
29 Veronica Llorens-Rico and Jeroen Raes, “Tracking humans and microbes, Nature, May 29, 2019,
https://go.nature.com/2keoAkR; Peter J. Turnbaugh, Ruth E. Ley, Michael A. Mahowald, Vincent Magrini, Elaine R. Mardis,
and Jeffrey I. Gordon, “An obesity-associated gut microbiome with increased capacity for energy harvest,” Nature 444
(December 21, 2006): 1027-1031, https://go.nature.com/2lyoK76, both accessed September 2019.
op
30 “Symbiota Names Entrepreneurial Leader David P. Perry as President and CEO,” PR Newswire, January 7, 2015,
https://prn.to/2kOBciZ, accessed September 2019.
31 Heather Somerville, “Ag-tech startup Indigo raises $100 million new funding round,” Reuters, July 22, 2016,
https://reut.rs/2kvq36y, accessed September 2019; Nanalyze, “Indigo Ag is World’s Biggest AgTech Startup,” July 26, 2018,
https://bit.ly/2orkHLs, accessed October 2019.
32 Christian Kreznar, “Indigo Agriculture Closes $250M To Launch Digital Farmer’s Market,” Forbes, September 18, 2018,
tC
https://bit.ly/2kESO0R, accessed September 2019.

33 This section draws heavily from Marco Iansiti, Michael W. Toffel, and Christine Snively, “Indigo Agriculture,” HBS No. 617-
020 (Boston: Harvard Business School Publishing, 2018).
34 Ben Popper, “One startup’s plan to grow more crops: put the germs back in,” The Verge, February 19, 2016,
https://bit.ly/2lAx3PE, accessed September 2019.
35 Kate Clark, “Indigo raises $250M, launches marketplace to help farmers get paid for quality grain,” Tech Crunch, September
18, 2018, https://tcrn.ch/2xqZNxu, accessed September 2019.
No
36 Paul Schrimpf, “Indigo Ag Is Betting on the De-Commoditization of Agriculture. Can It Work?,” Precision Ag, May 28, 2019,
https://bit.ly/2koGami, accessed September 2019.
37 “Indigo Agriculture Launches Indigo Transport, a Digital Logistics Platform to Expand Options for Growers and Streamline
the Agriculture Supply Chain,” Indigo Agriculture press release (Boston, Massachusetts, January 30, 2019),
https://bit.ly/2sYLygs, accessed September 2019.
38 “Indigo Agriculture Launches Indigo Transport, a Digital Logistics Platform to Expand Options for Growers and Streamline
the Agriculture Supply Chain.”
39 David Perry, “Indigo’s Partnership with Anheuser-Busch: A Major Step Towards Beneficial Agriculture,” Indigo, March 11,
2019, https://bit.ly/2knYNGX, accessed September 2019.
Do
40 “Indigo Ag, Inc. Acquires TellusLabs, a Leader in Satellite Technology and Artificial Intelligence, to Enhance Indigo’s Data-
Drive Agronomic Solutions,” Indigo Agriculture press release (Boston, Massachusetts, December 13, 2018),
https://bit.ly/2zZLKjD, accessed September 2019.
41 National Academies of Sciences, Engineering, and Medicine, Negative Emissions Technologies and Reliable Sequestration: A
Research Agenda (Washington, D.C.: National Academies Press, 2019), https://bit.ly/36sldu2, accessed October 2019.
42 Indigo Agriculture, “Terraton: Join the Global Movement” video, 2019.
30
620-024 -31-
t
os
43 Fred Pearce, “Geoengineer the Planet? More Scientists Now Say It Must Be an Option,” Yale Environment 360, May 29, 2019,
https://bit.ly/34h0FDa, accessed November 2019.
44 Dan Charles, “A Farm Journalist Tells Farmers What They’d Rather Not Hear About Climate Change,” NPR The Salt blog,
rP
June 2, 2017, https://n.pr/37swL0I; Marcia Delonge “United Nations Panel Says Farmers are a Key to Managing Climate
Change,” Union of Concerned Scientists, September 9, 2019, https://bit.ly/2QI1ilb, both accessed September 2019.
45 Adam Rogers, “Trying to Plant a Trillion Trees Won’t Solve Anything,” Wired, October 25, 2019, https://bit.ly/2CVs69L,
accessed November 2019.
46 Adam Rogers, “Trying to Plant a Trillion Trees Won’t Solve Anything.”
47 Louisa Burwood-Taylor, “Indigo CEO: Agriculture Can Reverse Climate Change and Livestock Farming Has an Important
Role,” Forbes, June 12, 2019, https://bit.ly/2kSQ1AX, accessed September 2019.
yo
48 David Perry, “Indigo’s Partnership with Anheuser-Busch: A Major Step Towards Beneficial Agriculture.”
49 Louisa Burwood-Taylor, “Indigo CEO: Agriculture Can Reverse Climate Change and Livestock Farming Has an Important
Role,” Forbes, June 12, 2019, https://bit.ly/2kSQ1AX, accessed September 2019.
op
tC
No
Do
31

Case Indigo Agriculture - Harnessing Nature

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Case Indigo Agriculture - Harnessing Nature

Uploaded by

Copyright:

Available Formats

t

Indigo Agriculture: Harnessing Nature

disruptive companies in 2019. 2

The Agriculture Industry

Figure A Traditional Agriculture Supply Chain

inefficiency, and save on fuel costs. 20

Agriculture and Climate Change

population increases? Second, how do we do it sustainably? Third, how do we change people’s

other aspects of agriculture—beyond inputs—needed innovation as well.”

Indigo Marketplace launched in September 2018. The supply side—growers—registered and

Comparing Marketplace to competing digitalization initiatives in agricultural, Raymond thought

amount to a 4% to 8% price premium. g

Growing Agronomy Expertise

Von Maltzahn characterized the idea and market opportunity:

Through the process of photosynthesis, agricultural plants have the ability to

A New Carbon Market Platform

Businesses would play an important role; in supporting Terraton certification,

the very type Indigo saw potential to generate.

Regenerative Agricultural Practices

Developing the Science of Regenerative Agriculture

Crowd-sourced Competitions Indigo could create crowd-sourced competitions to encourage

Experiments Indigo could also foster experiments to investigate the effectiveness of

Agriculture’s Future Beyond Indigo

Crop 2013 2014 2015

Note: mm = rain per square millimeter.

2020 2040 2060 2080

Barley (bushels) -1.9 -0.6 -3.5 1.0

Soybeans (bushels) -8.1 -8.8 -11.9 -14.3

Scalable Affordable Immediate

Source: Casewriters compiled from company documents.

Exhibit 13 The Proposed Indigo Carbon Market Platform

1. Growers enroll in Indigo’s carbon credit program.

4. Indigo gathers data manually and automatically.

Source: Company documents.

interviews; McKinsey Global Institute analysis, accessed October 2019.

20 John Deere, “MyJohnDeere,” https://bit.ly/2NoOc9k, accessed October 2019.

21 Project Drawdown, “Food: Sector Summary,” https://www.drawdown.org/solutions/food, accessed November 2019.

https://bit.ly/2kESO0R, accessed September 2019.

You might also like