ISIF invests US$65m (€60m) in two SOSV funds promoting sustainable investments and biomanufacturing

ISIF invests US$65m (€60m) in two SOSV funds promoting sustainable investments and biomanufacturing

16 June 2024

The Ireland Strategic Investment Fund (ISIF), part of the National Treasury Management Agency (NTMA), announced today that it has invested US$65m (€60m) in two specialist funds operated by US venture capital firm SOSV that promote sustainable investments and bio-manufacturing.

The investments include a US$32.5m commitment to SOSV’s new Ireland Bio-manufacturing Fund, which will invest at Series A stage and later stages in companies that locate advanced biomanufacturing or precision fermentation operations in Ireland.

ISIF’s US$32.5m commitment to this fund is being complemented by ISIF investing US$32.5m in a separate SOSV fund, Fund V, SOSV’s largest-ever fund at US$306m, which is focused on startups that can contribute to sustainable economies and which reached financial close last month.

SOSV, a US-headquartered firm founded by Irish-American venture capitalist Sean O’Sullivan, is a multi-stage venture firm with a decade of experience in many climate tech categories, and has a special focus on low-capex advanced biomanufacturing.

Minister for Finance, Michael McGrath TD said:

“I welcome the announcement by the Ireland Strategic Investment Fund (ISIF) of its US$65m (€60m) investment in two specialist funds promoting sustainable investments and bio-manufacturing operated by US venture capital firm SOSV. This investment also includes a US$32.5m commitment to SOSV’s new Ireland Biomanufacturing Fund which will invest in companies that locate advanced bio-manufacturing and precision fermentation operations in Ireland.

This announcement is the latest in a series of investments demonstrating both ISIF’s commitment to investing in the ever-growing bio-manufacturing sector and also how Ireland has now become a hub for bio-manufacturing.”

Nick Ashmore, Director, ISIF said:

“Ireland is well positioned to become a global leader in the emerging bio-manufacturing sector, a high-value, high-skilled sector that will allow Ireland to leverage its existing capabilities in food, pharmaceuticals, the emerging opportunities in renewable energy and food and drinks manufacturing and research.

ISIF is making this investment to support the development in Ireland of a bio-manufacturing sector, including renewable energy, bio-based feedstocks and an export-focused economy that needs sustainably sourced goods to compete.

Together with SOSV we want to build a strong incentive for startups in this sector to make Ireland their home for developing new technologies in precision fermentation and bio-manufacturing and scaling what they can do.”

SOSV is headquartered in Princeton, NJ, and has a 20-person team in Cork, Ireland, where SOSV was originally founded. SOSV operates the start-up development programs IndieBio (New York City and San Francisco) and HAX (Newark, NJ). SOSV is the first venture investor in about new 70 companies focused on “human and planetary health” each year; SOSV usually invests $500,000 in each company and welcomes them into one of SOSV’s 6-month start-up development programs, where the founders work with SOSV’s expert scientific, engineering, and business staff to advance their technology and product in preparation for raising series seed and later investment rounds, which SOSV usually joins, along with other investors.

In the past decade, SOSV’s IndieBio program has been the leader in developing startups that pioneered bio-manufactured products across industries ranging from dairy, materials, industrial chemicals and fuels. SOSV’s expertise will help assist Ireland in becoming a leader in sustainable food systems and decarbonization technologies.

“Europe is ten years ahead of the Americas and Asia in its regulatory framework to incentivise the transition to decarbonized industry,” said Po Bronson, SOSV general partner and managing director of IndieBio SF. “Europe is the best place in the world to locate these companies, and the best place in Europe is Ireland.”

“Ireland has been a consistent and successful gateway to Europe for many global technology companies for years,” said Sean O’Sullivan, SOSV Managing General Partner. “The export-focus of the Ireland economy, along with the tight-knit networks between industry and agencies across Ireland, will help startups grow fast. We’re extremely excited to partner with ISIF on this fund.”

The Ireland Biomanufacturing Fund has already made its first investment, California Organic, which processes farm waste to make the world’s first, organic-certified, emissions-free ammonia fertilizer.

In a related development, the recent announcement of the Cork Biomanufacturing Park – an initiative driven by University College Cork and Cork County Council – will offer opportunities for research, development and collaboration for biomanufacturing product development and scaling.

“The combination of sustainable resources with a top-class education and research base provides Ireland with the potential to be a world-leading location for the rapidly developing high-tech precision fermentation sector,” said John Morrissey, Cork Biomanufacturing Park director and a leading biomanufacturing researcher. “The Cork Biomanufacturing Park will establish an ecosystem that links research at the UCC SUSFERM Centre with innovative companies, whether start-up or established, to enable the development of commercial bioprocesses producing high-value products.”