A carbon-capture moonshot in the soil

Hello there,

PreSeed Now is nothing if not diverse. Tuesday’s edition was about the future of office work, and today we’re out in the fields looking at the future of crops with a startup that wants farmers to do away with chemical fertilisers. And it could also capture huge amounts of carbon in the soil to tackle the climate emergency.

Scroll down to read all about Alkama. And if you’re a PreSeed Now member you’ll get a whole lot more information about their ambitions and investment plans.

By the way, I have early-stage startups lined up for the next few weeks, but I’m always looking for more. If you know a really interesting, high-potential B2B or deep tech startup doing something different, get in touch.

– Martin

This issue is supported by Manchester Angels. Read more about them in our 6 September issue.

Alkama’s carbon capture moonshot could transform wheat farming

As the world adapts to a warming climate many things need to change, and farming is a particularly important one. Regenerative agriculture is a buzz phrase describing attempts to address this, and takes many forms.

Farnborough-based Alkama (there’s no website to link to yet, but they’re a spinout of T.I. Soil Ecology Laboratory) is part of this movement. This startup is looking to transform wheat production in the UK by boosting farmers’ profits and capturing carbon in the soil while replacing the need for agrochemicals and satisfying increasing demand for organic produce.

Alkama is developing a replacement for chemical fertilisers when growing crops - initially targeting wheat farmers in the UK. The product is called FITS, standing for ‘Factory In The Soil’ because of its ability to make all the nutrients the crop needs.

It takes the form of micro-organisms supplied in a thick liquid form, around the same consistency as ketchup. This is then either diluted and sprayed on the crop in the field, applied to seeds before drilling, or the soil itself can be treated with the product.

The benefits of micro-organisms

“The moonshot is that we will be able to replace all chemical inputs and have the same kind of yields,” says Alkama founder Daniel Tyrkiel.

For now, Tyrkiel says crop yields are likely to be lower than when chemicals are used, but farmers will still save between 20% and 30% on their input costs, leading to a more profitable crop. And farmers will be able to apply for organic certification, meaning they can charge higher prices for their wheat, which can be used to make organic bread - at least until everyone grows with a product like Alkama’s.

And then there’s the compelling benefit of carbon capture. This happens through carbon sequestration, where fungi take carbon absorbed by plants and store it in their mycelium in the soil. Wheat would put carbon into the soil regardless of its inputs, but Tyrkiel explains that the science behind Aklama’s approach makes all the difference:

“The plant pumps the carbon into the soil, but there is nothing to store it, and using synthetic fertilisers forces bacteria to burn off any carbon they can find to utilise it. The plants need the ecosystem in the soil, which in turn retains the carbon in the soil. The mechanisms are not yet fully understood, but our approach replenishes the missing members of the ecosystem, including fungi.”

And what’s more, Alkama believes this approach should then generate a healthier soil ecosystem for the years to come.

Alkama’s executive chairman, Ed French explains that early-adopter wheat farmers in the UK are the test market for the product while Alkama works on scaling production and refining the biology. It then plans to target the rest of the UK market, and international markets after that.

Globally, the UK is a high performer in terms of wheat yield per hectare (its exact ranking varies, but it’s in the top five). Tyrkiel says that if Alkama can tune its yield to match those of chemical inputs in the UK, it can take this product anywhere. 

Encouraging progress

Initial results sound encouraging. Alkama has been testing its approach on crops since the start of last year. French says the latest data from trials in Scotland shows the Alkama approach beating chemical fertilisers for pasture yield.

“This isn't unexpected, as improving the ecosystem within the soil improves its water retention, and makes it easier for roots to grow deeper to access water. This is our first result where we exceeded the chemical approach, so we are excited with the impact we could have to improve drought tolerance.”

French adds that tests are still underway to confirm the yield possible using Alkama, and they will continue in both fields and greenhouses over the next year. French sees initial scaling of the product to be a multi-year process, not only because the product will be refined over that time, but farmers will need time to adopt it.

“There’s a bit of a lag because the farmer will want to do a test plot in year one, and then maybe a big field in year two, and then maybe go over completely in year three. So we've got to assume that there's a time for each farm to do it. It'll take some time to build the numbers, but then they're fairly relentless.”

Tyrkiel says Alkama has more than 100 farms interested in conducting commercial trials. He says he’s yet to receive a ‘no’ from a farmer he’s contacted.

An unusual path to the wheat field

Usually, a founder launching a startup of this kind would come from an agricultural or academic background, but Tyrkiel previously worked in procurement. So how has he become a crops entrepreneur?

He says that after his daughter was born he took an interest in climate change and its relationship with agriculture. In 2017 he spotted the opportunity to productise years of academic research around the world that showed that microbial inputs could benefit plants. 

“We needed someone to step in and stop this chicken-and-egg game. Farmers aren’t asking for it because nobody's produced it. And then nobody's producing it because no farmers are asking for it because they don't know something like that could exist… 

“And so in 2019, I just took the biggest debt I could onto my name and just quit my job and went in headfirst.” 

Tyrkiel says his work is particularly influenced by the work of Dr Elaine Ingham, a soil biologist who co-authored an influential 1985 paper on the relationship between fungi and plant growth, and Dr David Johnson. “[Johnson] demonstrated he was able to store a phenomenal amount of carbon in the soil. The actual amount of carbon that we could be storing in the soil is phenomenal if we can roll this out to the same effect as he was doing at a small scale.”

Executive chairman French was impressed upon meeting Tyrkiel. “One of the things that blew me away when I was going through this with Daniel originally was that some of the fundamental ideas about trying to fix the ecosystem within the soil aren't particularly new ideas. 

“There was evidence this was a good way to go years ago, but not as a practical solution that the farmer could deploy. So in practice it never made that transition from the lab into a product that farmers could buy. Because it's not actually easy. It’s taken Daniel a lot of time and a lot of years of effort to get to the point of which there's actually a product that you can use that contains this vital ecosystem in a liquid form.”

Tyrkiel says the Alkama team consists of two other full-time staff members, with support on hand from a number of academics and organisations in the soil biology space. 

Microbiology, macro potential?

Unsurprisingly, Alkama faces competition, but Tyrkiel and French believe no-one is quite as ambitious as they are. For example, US-based Pivot Bio raised a $430m series D round last summer but French says that company’s focus is much narrower than Alkama’s.

“It's just trying to improve yield. There’s nothing wrong with that, and to use a biological approach is great. But they're not trying to say ‘hey, let's replace all agrochemicals and produce the same yield, and catch carbon’. And that's true for everything we've looked at.”

An important part of the puzzle for Alkama to really fulfil its potential would be for widespread financial incentives to be put in place for farmers running carbon capture schemes - these aren’t in place yet.

Tyrkiel says Alkama has raised £184,000 in external pre-seed investment to date. French is working with them to raise a more substantial round.

“Our ideal investor would be one who'd be able to stay with us and help us beat some of the obstacles ahead. Up until this summer, the company's been a laboratory… working on the fundamental technology - how do you produce a usable material that can be distributed to the farmer? That piece is now done and we’re moving into a stage where that agenda needs to change, we need to be more commercial,” says French.

“There's an awful lot that we need to do, so [we need] an investor who's comfortable with something that's this ambitious . At the moment [this market] is an open field. We want to be able to move quickly, so an investor who's got that ambition and got that drive to help us move quickly on this would be immensely helpful.”

As for Alkama’s long-term ambition, French says that having a meaningful impact on the levels of carbon in the atmosphere is an important goal. But from a commercial perspective, the startup talks a big game, as French summarises:

“You're looking at something of the scale of when the first processes were introduced for making chemical fertilisers. It's that scale of opportunity, which built some of the biggest companies in the world. There's no reason that this shouldn't–providing it all works and carries on working–be that kind of scale of innovation. And they don't come along very often.”

In summary:

Name: Alkama

What they do: Microbial inputs for wheat crops with strong environmental benefits

Location: Farnborough, Hampshire

Raised to date: £184,000

Currently raising?: Yes

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Another startup we’ve covered: The future of farming… in a shipping container?

Back on Tuesday

Next week I’m currently planning to bring you a couple of very different health-related software products. Keep an eye on your inbox, and thanks for being a PreSeed Now member 🙏