Lilac Agriculture has closed an oversubscribed $2.3 million seed round to commercialize rhizobial inoculants that it says delivered an 11% yield increase over uninoculated pulse crops and a 6% gain versus an existing commercial product in multi-site field trials.

Innova led the round, with backing from 701 Fund, Ag Ventures Alliance, Evergreen Climate Innovations, North Dakota Development Fund, Pathway Ventures, Tall Grass Ventures and others. The financing will fund expanded field trials, further R&D platform development, wider commercialization of the company's first strain, PL11, and preparations to enter the Canadian market.

The company had originally targeted $1.5 million but increased the round to $2.3 million after investor interest outpaced the goal.

Why does nodule occupancy matter?

Inoculating pulse crops with rhizobia is standard practice across major growing regions. The bacteria colonize plant roots and form nodules that fix atmospheric nitrogen into a usable form. The problem, says Lilac CEO Natalie DiNicola, is that native soil bacteria frequently outcompete the inoculant, leaving growers paying for a product that may not be doing anything.

Lilac Agriculture was founded in 2024 by North Dakota State University assistant professor Dr. Barney Geddes, agtech veterans Matt Crisp and Tom Snipes, and NDSU biotechnology graduate Wyatt Warkenthien.

"He felt like inoculants were sort of a black box; there wasn't a lot of transparency about what you were actually buying and if it was working," says DiNicola. "He would dig up the roots, plate out the nodules, and the bacteria in the nodule was not the bacteria that was in the commercial product farmers had purchased."

The platform screens the diversity already present in NDSU's rhizobial collection, selecting simultaneously for nitrogen-fixing efficiency and competitiveness. Molecular markers let the team determine which strains have penetrated roots and occupied nodules.

"Having grown up as a farmer, the black-box claims in this category always frustrated me – you put an inoculant in the ground and just have to trust that it works. As a scientist, I want to fix that," says Geddes, the company's CSO. "There's a huge amount of untapped variation in rhizobial bacteria that's gone largely unexplored since most commercial strains were selected decades ago."

Select first, then evolve

PL11 emerged from the first stage of the platform: selecting the strongest naturally occurring strain from a broader pool. A second phase applies "guided evolution," using selection pressure in the lab and microbes' rapid reproduction rates to iterate quickly.

"The great thing about microbes is that they multiply really fast, so you can iterate and test very quickly," says DiNicola. The same approach could extend to traits such as competitiveness or drought tolerance.

In effect, Lilac is applying a plant-breeding philosophy to microbes. Legacy suppliers, DiNicola says, have advanced formulation and shelf-life, but most products still use rhizobium strains identified decades ago from a USDA collection. "There's a lot of diversity within these microbes that essentially hasn't been fully tapped the same way that we tapped the genomic differences in seeds."

A third phase could involve gene editing, though DiNicola stresses that microbial gene editing remains challenging. PL11, for now, is a naturally selected strain.

What are the trial numbers based on?

Field trials across multiple sites and soil types showed an aggregate 11% yield increase with PL11 compared with no inoculant and a 6% increase versus an existing commercial inoculant. Attributing gains to a single intervention is notoriously difficult, but Lilac says it can offer transparency the category has lacked.

"We're actually checking that our product is in the nodules of the plant," says DiNicola.

Who is the first target market?

Lilac is initially targeting pulse growers in the Northern Plains, roughly 90% of whom DiNicola estimates already use inoculants. "It's almost like they have to buy it as an insurance," she says of growers' lack of visibility into returns.

The first product is a shelf-stable powder with a six-month shelf life, applicable with standard equipment and priced within the existing category. "We're taking something they're already using and making it better within that same price range, so they're getting more upside opportunity without additional risk," she says.

PL11 was sold commercially on a small number of pea and lentil acres this year, generating initial revenues. Lilac plans to expand pea and lentil acreage next season, add a dry bean product, and register in Canada — one of the world's largest pea and lentel markets.

Soybeans are a relatively straightforward next opportunity because they naturally form nitrogen-fixing nodules. Cereals such as corn lack that symbiosis, but the platform remains applicable: "We're absolutely intending to move into row crops," says DiNicola.

How much capital does Lilac need?

Lilac is targeting profitability on roughly $5 million in total capital, a relatively capital-light model DiNicola credits for attracting investors in a tough agrifoodtech funding environment. DiNicola brings more than 20 years in the industry, including senior roles at Monsanto and Benson Hill.

"I'm a scientist by training, and I love really complex, hairy science. But in this environment, what we need is a very practical approach," she says. "We're layering advanced technology on top of something farmers already use and getting into the market quickly."

The near-term test will be whether expanded pea and lentil acreage, a new dry bean product and Canadian registration can convert early trial gains into repeat purchases at commercial scale.