AMDP Investment Proposal Memo

To: Clark Hansen 

From: Isabella Carpenter 

Subject: AMDP Investment in Biome Makers

Date: March 10th, 2023

 

 


In this memo, I will provide my findings on the company Biome Makers. As a research and development Analyst at AMDP, I have completed extensive research on this potential investment opportunity. Biome Makers is known for its sustainable and environmentally friendly business practices. I will explain their background, financial health, and conclude with my recommendation to consider investing in the company. 

 

Investment Standards 

 

At AMDP, we as a company are committed to investing in businesses that align with our values of social responsibility and environmental sustainability. We also are dedicated to ensuring we conduct business with other companies that are profitable or hold the potential of profitability. We assess potential investments based on these four criteria to ensure our values and goals are met.  

 

Triple Bottom Line – The triple bottom line in business practices is when an organization is committed to allocating their profits to the people, planet, and sustainable business practices. Best described as "The triple bottom line is a business concept that posits firms should commit to measuring their social and environmental impact—in addition to their financial performance—rather than solely focusing on generating profit, or the standard "bottom line." It can be broken down into "three Ps": profit, people, and the planet." (Miller).

 

Corporate Social Responsibility – "Corporate social responsibility (CSR) is the business practice of joining environmental and social policies with a business' economic goals and operations. It is based on the idea that businesses can reduce their adverse social and environmental impact on the world." (Edmondson). It is becoming exponentially important for more companies to adopt CSR into their businesses. 

 

Social Enterprise – "A social enterprise is a cause-driven business improving social objectives and serving the common good." (Velez). Overall social enterprise is when business generate revenue with the pre-existing goal of committing all or some profits to an organization that support people and or the planet. 

 

Carbon Footprint – "carbon footprint is the amount of carbon dioxide (CO2) emissions associated with all the activities of a person or other entity (e.g., building, corporation,

country, etc.)" (Selin). Environmental scientists can measure carbon footprint by "summing the emissions from every stage of a product or service's lifetime" (Center). Reducing our carbon footprint is important because the carbon dioxide released into our atmosphere will result in "increased ocean acidification, rising sea levels, more frequent and intense storms, mass species extinction, food scarcity, and greater economic inequality…" (What is). 

 

Company Background

 

Biome Makers is a start-up sustainable soil company founded in Silicon Valley, California, in 2015. The co-founders are Adrian Ferrero and Dr. Alberto Acedo. The company aims to optimize farming practices and create a more sustainable world. The company claims that they "enable sustainable farming by providing insights and neutral biocomputing apps to empower farmers and recover soil health." (Initiatives). This is accomplished by a procedure that starts with a kit being sent to the farmers; then, the farmer will take soil samples from around their farm and place the samples into vials. These vials are sent back to Biome Makers and from there, their scientist can create a complete report about the health of the soil for the farmer. Not only does it help the farmer know if there is any diseases or issues in the soil, but it also promotes efficiency, safety, and environmental health when farming. The goal is to maintain sustainable and healthy soil and educate farmers on sustainable farming practices. Looking at this company, it is evident that Biome Makers is conducting business in a socially responsible and environmentally sustainable way. (About).

 

 

Sustainability and Impact 

 

Biome Makers is committed to being environmentally sustainable. In a report done on their environmental impact, that data shows that they reduced agrochemical fertilizer application by 20%, which, to give perspective, is equivalent to about 50 full oil tanker trucks. Taking these fertilizers out helps keep both the soil and the crops clean. Regarding their carbon footprint, they increase their carbon sequestration by 15%, which is equivalent to planting 800 trees a year. They recognize that they need to address three primary challenges to drive sustainable farming practices and improve the earth's overall health. These challenges are ensuring fair working conditions for the farmer, creating a nature-positive food production system, and strengthening the ecosystem. They have created a 5-year plan starting in 2019 to meet all these challenges and have laid a comprehensive roadmap to accomplish these goals. (Initiatives)

 

 

Financial Success

 

Since the company's inception in 2015, they have raised 22.94 million dollars. The investments into the company have been frequent and substantial. The last reported investment into the company was on October 20, 2022, amounting to 1.6 million dollars during their Grant-II round. They currently have had a total of 11 investors. (Biome) 

 

 

Expert Opinions 

Opinion #1 – Forbes 

 

In an article by Forbes titled "Biome Makers Raises $15 Million to Become The 23andMe of Soil" by Rebecca Szkutak, Biome Makers is praised for their unique business approach to farming sustainability. The article mentions, "Banafsheh Faithieh, the head of investments, America at Prosus, says that investing in Biome Makers was an obvious choice due to her firm's microbiology and sustainability investment themes" (Szkutak). This shows us that other prominent business professionals are highly interested in Biome Makers.

 

Opinion #2 – TechCrunch+

 

TechCrunch+ is a publication website that posts articles about start-ups and entrepreneurial ventures. In an article titled, "Biome Makers closes $4M to assess the quality of the 'gut bacteria' of a farm's soil," Mike Butcher talks about Biome Makers unique position in the market when he writes, "Biome Makes takes a different approach… Currently, there are many companies that carry out physical-chemical analysis of the soil, but until now, the microbiome dimension has not been taken into account." (Butcher). These two expert opinions show how Biome Makers has experienced financial and sustainability successes. 

 

Recommendation 

 

After my analysis of Biome Makers, I have determined that this company meets all standards of investment for AMDP. The company is profitable, growing, sustainable, and, most importantly, committed to environmental business practices. The expert opinions attest to Biome Makers' current and future success. Overall, the values and mission of Biome Makers align well with AMDP standards. 

 

For these reasons, I recommend that AMDP should invest in Biome makers. The company is already a successful and profitable company and reflects the values of AMDP. With the support of AMDP, we can create a greener world together.

 

 

Thank you, 

 

Isabella Carpenter 

AMDP R&D Analyst

 

 

 

 

Work Cited

“About Us - General: Biome Makers.” About Us - General | Biome Makers, https://biomemakers.com/about.

“Biome Makers.” CB Insights, https://www.cbinsights.com/company/biome-makers/financials. 

Butcher, Mike. “Biome Makers Closes $4m to Assess the Quality of the 'Gut Bacteria' of a Farm's Soil.” TechCrunch, 2 Aug. 2019, https://techcrunch.com/2019/08/02/biome-makers-closes-4m-to-assess-the-quality-of-the-gut-bacteria-of-a-farms-soil/. 

Center for Sustainable Systems, University of Michigan. 2021. "Carbon Footprint Factsheet." Pub. No. CSS09-05.

Edmondson, Brian. “What Is Corporate Social Responsibility?” The Balance, https://www.thebalancemoney.com/corporate-social-responsibility-csr-4772443.

“Initiatives: Biome Makers.” Initiatives | Biome Makers, https://biomemakers.com/about/initiatives.

Miller, Kelsey. “The Triple Bottom Line: What It Is & Why It's Important.” Business Insights Blog, 8 Dec. 2020, https://online.hbs.edu/blog/post/what-is-the-triple-bottom-line.

Selin, Noelle E. “Carbon Footprint.” Encyclopædia Britannica, Encyclopædia Britannica, Inc., https://www.britannica.com/science/carbon-footprint.

Szkutak, Rebecca. “Biome Makers Raises $15 Million to Become the 23andMe of Soil.” Forbes, Forbes Magazine, 24 Aug. 2021, https://www.forbes.com/sites/rebeccaszkutak/2021/08/24/biome-makers-raises-15-million-to-become-the-23andme-of-soil/?sh=272888573f12. 

Velez, Henah. “What Is a Social Enterprise?” The Good Trade, 3 Feb. 2023, https://www.thegoodtrade.com/features/what-is-a-social-enterprise/.

“What Is a Carbon Footprint?” What Is a Carbon Footprint, https://www.conservation.org/stories/what-is-a-carbon-footprint. 

 

 

 

 

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