Evolve BioSystems, UC Davis baby-probiotic spinout, is going global with new $40M financing

  • Series C lead investors: Gates Foundation, Li Ka Shing Foundation venture arm
  • First outside investment: $1 million seed round in ’14
  • Evolve looks to penetrate Asia market, develop microbiome diagnostic test

Evolve BioSystems is gearing up to take its infant probiotic global and create new products that fight malnutrition, having scored a $40 million Series C financing led by the Bill and Melinda Gates Foundation and Horizon Ventures, Li Ka Shing Foundation’s venture arm.

The latest financing round brings the Davis, California, startup’s total funding to date to $70 million, Evolve CEO Tim Brown told Buyouts.

New investors joining the latest round include Johnson & Johnson Innovation and Arla Foods and Continental Grain Co. Previous investors — Tate & Lyle Ventures, Alta Ventures, Spruce Ventures, Acre Ventures and Bow Capital — also participated in the round.

The company’s main product, Evivo, is the first probiotic clinically proven to restore the infant gut microbiome. The Evivo powder essentially restores a natural microbiome that most newborns in developing regions have lost, largely as a result of antibiotics and C-sections, Brown explained. The loss of this specific bacteria, B. Infantis, leads to longer-term health issues, the CEO said.

“We feel public health is threatened by the potential loss of this microbiome,” Brown said, adding that Evivo is a “solution to what we think is an important public health program.”

While Evivo today is available only in the U.S., the probiotic powder in October gained regulatory approval for commercialization in Canada.

The new capital injection will support the company’s expansion beyond North America, and specifically within the China and Asia region, where Brown said the rate of C-sections is high.

Evolve’s latest investment comes after the company in April announced a collaboration with Gates Foundation, a major philanthropist in global health.

Evolve will further its partnership with the foundation to study global malnutrition, and as it relates, the impact on Evivo in infants. Gates will work with Evolve on a series of clinical studies and product development, specifically within developing countries, he said.

The new financing will also support Evolve’s plans to develop and bring to market the first-ever microbiome diagnostics test.

Evolve spun out from the Foods For Health Institute at the University of California, Davis, having completed its initial $1 million seed funding round in mid-2014.

The company subsequently raised $9 million in a Series A round in August 2015 and $20 million in a Series B financing in 2017.

Founding scientists include Bruce German, David Mills, Carlito Lebrilla, Daniela Barile and Samara Freeman.

Brown, a longtime industry veteran, held previous executive roles with companies including Mead Johnson Nutrition and Procter & Gamble.

“Our sights are set on achieving profitability, and we see this round of investment driving us toward that,” Brown said.

Action Item: Learn more about Evolve BioSystems