After the local startup Benson Hill debuted as a $2 billion public company on the New York Stock Exchange in 2021, it became the go-to success story of St. Louis’ developing innovation system. St. Louis now had claim to a homegrown “unicorn.”
But in just a few years, that story crumbled as the company built around innovation in soybean genetics began to struggle, weighed down by physical assets and a bet on plant-based meat protein that didn’t deliver the intended results. The company went through a structural pivot, now looking to sell its high-protein soybeans as animal feed, especially for poultry.
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“That kind of work—making pivots, recreating new markets, establishing what those value chains are going to look like—it takes time and money,” says Mike DeCamp, president and CEO of St. Louis-based Expedition Ag Partners. “Unfortunately, they ran out of both.”
Benson Hill filed for Chapter 11 bankruptcy protection in March. Two months later a new private company, Confluence Genetics, emerged with Benson Hill’s core intellectual property, assets, and market strategy. DeCamp’s Expedition Ag Partners, local to St. Louis, is the lead investor, Steve Kahn (also a St. Louis local), S2G Investments, and ProAgInvest, LLC.
DeCamp adds his organization is not involved in the day-to-day minutiae, but he’s rather the executive chairman, there to support the team already in place, which he credits with restructuring the company’s approach into a viable business. The bankruptcy simply allowed for a better cost structure, he says.
“The Benson Hill team worked really hard prior to bankruptcy to try to restructure the company, and they’re the ones that got the company in this position that we’re now benefiting from,” DeCamp says. “[The bankruptcy] put us in a great spot to leverage all that work to focus it where we’re focusing it now, which is not necessarily a new direction.”
Confluence Genetics’ CEO Kim Hurst (who had been Benson Hill’s vice president of corporate development) says the work Benson Hill put in to shed physical assets, such as processing facilities in Iowa, Indiana, and North Dakota, as well as the refining its business, customer and marketing strategy made the bankruptcy process all the more smooth and attractive to new investment. The restructuring also meant slimming the overall staff down from hundreds to around 60.
“By the time we filed for bankruptcy, we had no long-term debt. We also had no secure creditors,” she says. “It’s the culmination of, let’s call it an 18-month effort to reset the business around this asset light strategy and strong market demand signals.”
The new company is “focused solely on optimizing soy quality traits and nutrient density,” while removing “anti-nutrient” elements of soybeans (oligosaccharides) that make them more difficult to digest, Hurst explains.
“If you can reduce those anti-nutrient factors and increase the protein or the amino acid contents, what you have is a better soybean, which translates to a better soybean meal,” she says. “When formulated into a diet for broilers or turkeys, it means that you get better performance on the other side.”
That type of value can then extend across this part of the food-supply chain, Hurst says, because animal feed with higher protein and other nutrients allows producers (think Tyson, Purdue or Murphy Brown) to get similar results while buying less product. These types of soybeans also have applications in feed for fish, a market Benson Hill had previously developed, and one Confluence Genetics intends to maintain, she adds.
To make soybeans with these preferred traits, the new company will continue to make use of three core technologies purchased from Benson Hill in the bankruptcy process: decades of research into soybean genetics Benson Hill had acquired from Schillinger in 2019, a predictive breeding software platform called CropOS, and a physical “crop accelerator,” a speed breeding facility housed in the 39 North AgTech Innovation District.
Confluence can feed the soybean genetics into its proprietary AI and machine learning in CropOS to develop a road map for plant breeding and then test them in one of the 13 plant growth chambers in the crop accelerator, Hurst says.
“The rapid prototyping that we can do in the crop accelerator brings the digital breeding roadmaps to life,” she says. “It’s a controlled environment that enables this year-round innovation to occur, and it compresses a timeline and accelerates our speed to market.”
The compressed timeline could save a year or two in bringing a soybean product to the market, because the crop accelerator allows for three to four growing cycles a year versus the one you get in nature, says DeCamp.
“What we have [are] the data points around our genetics that help speed this up,” he says. “Instead of going to the field to select for a certain characteristic, we can actually rely on the modeling.”
Lessons learned
The story of Benson Hill, and the hopes for what comes next from the company’s assets now housed at Confluence Genetics, underscores some of the key challenges that businesses centered on innovation in the agricultural space face. Agtech investments take time, Hurst explains, and are not always ideally suited to public markets, or for that matter private investors who are impatient for returns.
“Even with the breeding innovations and successes that we’ve had, to get to full commercialization of our pipeline really does take time,” she says. “You can only accelerate the pace of Mother Nature so quickly, and it takes substantial supply chain coordination in order to achieve that.”
And vertical integration in the agriculture space can be tricky to pull off. While Confluence Genetics retains the seed from Benson Hill, there’s an eye toward licensing its soybeans and working with partners within the agricultural supply chain, Hurst adds.
“One of the things that we learned from the experience at Benson Hill is that it is better to leverage the strengths along the supply chain in order to get the technology into the right hands and in order to be able to scale up the acreage,” she says.
Despite the bankruptcy, DeCamp counts it as a success that the innovation developed at Benson Hill remains local.
“It’s great to know there is a remnant of what that company was that’s still here in St. Louis with a new lease on life,” he says. “For this ecosystem to have been in a spot to be able to heal, in essence, what was maybe broken and relaunch it with a new life is a cool story as well.”
39 North Executive Director Emily Lohse-Busch agrees, adding the science, intellectual property, and other advancements from Benson Hill are still valuable.
“The fact that that company, IP, [and] assets were able to be purchased out of Chapter 11 by a group of investors that were primarily based here in St. Louis is a really exciting development,” she says.
And, she adds, many former Benson Hill employees managed to stay in the region, scooped up by other companies here seeking strong plant-science talent. It speaks to the strength of the local agtech ecosystem, Lohse-Busch argues.
“This is anecdotal, but in the experience that we had with the employees that were unfortunately having to leave Benson Hill, almost every person was immediately re-employed in many cases within 39 North,” Lohse-Busch says. “There’s resilience on the people’s side. There’s resilience on the innovation side.”
