Belgium’s VIB institute is no stranger to delivering gamechanging biotech companies. Since launching in 1995, the hub’s scientific research has birthed over 40 spins-offs which have attracted a combined €2bn in investment, such as Plant Genetic System, an early pioneer of genetic engineering of plants later sold to Bayer, and CropDesign, now owned by BASF.
It now thinks it has might have another in the shape of Rainbow Crops.
Rainbow Crops launched in May last year to develop crop varieties with enhanced traits for climate resilience, input efficiency, and yield. It does this through combining multiplex genome editing, artificial intelligence, precision breeding, and automated phenotyping.
While still in its early stages, this month Rainbow Crops received a $7m grant from the Gates Foundation to help develop varieties of heat and drought resistant corn, sorghum and rice. It is also finalising a major collaboration with a seed company to develop new types of corn, says CEO Giacomo Bastianelli.
ATN: Where did Rainbow Crops come from?
Bastianelli: There was a paper published by Hilde Nelissen at VIB in 2023 which combined breeding with genome editing to modify multiple genes at the same time.
When they published, VIB started getting a lot of interest from seed companies that wanted to collaborate. And they thought: ‘oh, maybe we should think about spinning off a company’.
ATN: What was it about that paper that got people interested?
Breeding is about taking the genetic diversity introduced by nature, and then crossing plants to stick all the good traits into one. That’s been the classical way. The problem is that it’s random and slow.
The way this is new is that you use the targeting approach of CRISPR to create a genetic diversity that is rationally designed. So you use data and AI to identify targets. Let’s say you want to improve drought in corn, then you might have a bunch of targets, and you leverage the multiplex capability of CRISPR to make multiple mutations at the same time, together with breeding, to create a population of plants with different combinations of modifications. And then you screen each individual plant.
In essence, its accelerating what nature does.
ATN: What sets Rainbow Crops apart?
What sets us apart is the whole stack. There are some companies that might do the AI prediction, some companies might do gene editing, and some companies the phenotyping. We have the whole stack.
And this is not because we are extremely rich. We are rich because we inherited a lot of capabilities and infrastructure from VIB.
ATN: How does it work as a business?
We are a technology partner for mid-size seed and breeding companies who don’t have these advanced genome engineering capabilities.
We’re not a seed company. We don’t want to become one. We want to help these companies with good genetic material to enhance those materials with our technology platform.
And our business model is that we develop these varieties and we license the output of that research to the seed companies. We are paid by milestones and royalties when they start selling those varieties to farmers.
It’s not a software business where you can start generating capital in two or three years. It’s long-term type of revenue generation. That is why we need patient capital.
ATN: When you say it’s a collaboration, is it typically they will come to you and say: ‘we want to develop a seed that is more drought resistant. Can you help us?’
Yes, and then we run this program. It could be two to three years of R&D and the output of that would be the combination of few modifications that improve that trait.
We might do some field trials but usually we rely on the capability of the companies because they have the expertise of running field trials and the market access we don’t have.
ATN: So once you create the new gene sequence, the seed company owns it?
It depends on the contract. If the seed company pays everything, then they might. If we also invest on our side on these projects, then it will be co-owned and we will get payments down the line whenever they start commercializing.
We like to put our skin in the game because we cannot do 20 projects at once. It’s not necessarily expensive but it’s resource demanding.
ATN: What projects are you working on at the moment?
We were born with maize, because the lab that generated the IP that became Rainbow Crops has a lot of experience in maize. We’re going to do a collaboration for this, and others such as sorghum and rice. That has started already as part of the grant from the Gates Foundation.
ATN: What’s the market demand for this?
It really depends on the combo of the crop and the trade. So for example, if you’re working in yield and corn, that’s probably the biggest value that you have.
Then there could be soybean and yield which is the king of the trades. They have a problem with yield, that’s why they’re interested in abiotic stress like drought, heat, cold, depending on the crop and the location.
The race must now be on to develop the seed with the highest yield and strongest resilience to volatile weather? Because every farmer is surely going to want that?
Yes, and this is now accelerating because the change in regulation in Europe in the last few weeks [which eased rules on foods modified with new genomic techniques].
This kind of entity not being considered GMO has released a lot of fuel into the market and I feel companies are more inclined to go: ‘OK, let’s start working on this.’
Not so much for corn and soybean, but crops key to Europe like potato, there has been a block in there.
ATN: When do you expect your first commercial product will be ready?
Probably in four to five years. We’re now fundraising to fund this part.
ATN: What have you got that can give investors confidence that you’re on the right track?
I think there’s been two elements. One is VIB’s reputation of building world class companies in plant biotech. And two, the Gates Foundation recognising us.
