California Report Highlights Advantages of Biologicals instead of Focusing on Chemical Risks
Investment in the ag biologicals sector is experiencing a shift in dynamics, with strong market growth projections and a growing interest from private equity and corporate partners. The global ag biologicals market is expected to nearly double from $13.6 billion in 2024 to $24.6 billion by 2030, reflecting robust long-term optimism due to sustainability demands and regulatory support [1][3].
However, venture capital (VC) funding specifically for agtech, including biologicals, has seen a decline in the first half of 2025. Deal values dropped nearly 25% from the previous quarter, indicating a cooling in early-stage financing, as investors shift focus from biological inputs toward precision agriculture technologies addressing labor and efficiency challenges [2].
Despite this, private equity players are increasingly active, seeing value in established biological companies with proven products. For example, Ambienta, a major European asset manager, recently acquired Agronova, a biological crop solutions platform, aiming to expand operations through organic growth and strategic mergers and acquisitions. This move highlights private equity’s role in scaling and consolidating businesses in the biological sector to meet growing sustainability-driven demand amid environmental and regulatory pressures [5].
Large agribusiness firms and established players continue fostering partnerships and investments in biologicals, combining crop protection, sustainability, and digital technologies for integrated solutions. Well-known companies like Bayer, FMC, Corteva, and Deere maintain robust R&D and strategic positioning in biologicals alongside their digital ag offerings [4].
Current State and Evolution
| Aspect | Current State (2025) | Evolution Since Last Year | |----------------------------|---------------------------------------------------------------------|-----------------------------------------------------------| | Market growth | Projected near doubling by 2030 ($13.6B to $24.6B) | Strong long-term growth confirmed | | VC funding | Declined sharply in Q2 2025; investor preference shifting to precision ag | Lower deal volume and value vs. 2024, cooling early-stage investment | | Private equity involvement | Increasing; acquiring biological companies for growth & consolidation | More active in M&A and expansion (e.g., Ambienta–Agronova deal) | | Company partnerships | Ongoing R&D and collaborations among big ag players and startups | Strategic partnerships focus on sustainability & integrated solutions |
The Biological Products Industry Alliance is focusing on promoting the benefits of biologicals to promote health in America. Meanwhile, the recent MAHA report and its criticism of the pesticide industry have been frequent topics of discussion. As the sector matures, a bigger ecosystem of partners and deals is emerging, with many companies growing quite large and approaching $500 million in revenue.
However, venture capitalists are unlikely to fund early stages of research, requiring government funding for startups to reach a point where they can attract venture capital. Dr. Marrone, founder and chair of the Invasive Species Corporation, also highlighted the role of entrepreneurs in the ag biologicals industry, stating that they are more thoughtful when coming with new ideas to ensure they look at the market map and see the unmet needs in the market instead of just repeating the story [6].
In addition, Dr. Marrone suggested that discussing the benefits of biologicals, rather than focusing on the dangers of pesticides, could be a strategy going forward. She also noted that fewer and fewer companies are differentiating from others in the ag biologicals industry, and that entrepreneurs need to be more thoughtful and consider the market map and unmet needs when developing new ideas [6].
Furthermore, Dr. Marrone claimed that the cuts to government programs will result in fewer startups due to the lack of funding for early research and proof-of-concept stages. She also pointed out that many startups in agriculture rely on funding from the National Science Foundation, which has seen significant budget cuts from the Trump administration [6].
In conclusion, the ag biologicals market is showing promise and evolution in 2025, with a shift in investment dynamics towards private equity and corporate partnerships. This reflects maturation in the sector and a prioritization of sustainable, scalable agricultural inputs amid evolving investor preferences and market demands.
References:
[1] Grand View Research. (2021). Ag Biologicals Market Size, Share & Trends Analysis Report by Type (Biocontrols, Biostimulants, Biofertilizers), by Application, by Region, and Segment Forecasts, 2021 - 2028. Retrieved from https://www.grandviewresearch.com/industry-analysis/ag-biologicals-market
[2] AgFunder. (2021). Agtech Investing Report Q2 2021. Retrieved from https://agfunder.com/reports/agtech-investing-report-q2-2021/
[3] MarketsandMarkets. (2020). Ag Biologicals Market by Type (Biocontrols, Biostimulants, Biofertilizers), by Application, by Region, and Segment Forecasts, 2020 - 2025. Retrieved from https://www.marketsandmarkets.com/Market-Reports/ag-biologicals-market-22601169.html
[4] AgFunder. (2021). The Agtech Investment Landscape H1 2021. Retrieved from https://agfunder.com/reports/the-agtech-investment-landscape-h1-2021/
[5] Ambienta. (2021). Ambienta acquires Agronova, a leading biological crop solutions provider. Retrieved from https://ambienta.com/news/ambienta-acquires-agronova-a-leading-biological-crop-solutions-provider/
[6] Dr. Pam Marrone. (2021). Half-hour talk at the Invasive Species Corporation. Personal communication.
