Arcadia Biosciences Raises $2.1M in Strategic, Dilutive Capital Deal

DALLAS, TX – January 12, 2026 – Arcadia Biosciences, Inc. (Nasdaq: RKDA), a company pivoting its focus toward the wellness product market, announced today it has secured approximately $2.1 million in gross proceeds through a complex financial maneuver involving preferred investment options. The deal provides a much-needed cash infusion for the company as it navigates significant financial headwinds and attempts to capitalize on the growth of its flagship Zola® coconut water brand.

The capital was raised by incentivizing holders of previously issued investment options to exercise them immediately. This move, while shoring up the company's balance sheet, involves significant concessions and shareholder dilution, highlighting the difficult choices facing small-cap companies in need of working capital.

The Mechanics of the Capital Raise

The transaction, managed by exclusive placement agent H.C. Wainwright & Co., centers on preferred investment options originally issued in multiple tranches between December 2020 and March 2023. These options, covering an aggregate of 808,595 shares of common stock, initially carried an exercise price of $9.00 per share. With Arcadia's stock trading significantly below that level for a prolonged period, these options were effectively worthless to their holders.

To unlock the capital, Arcadia drastically reduced the exercise price to $2.575 per share, creating a powerful incentive for investors to convert their options into stock and provide the company with immediate cash. The new exercise price aligns closely with the stock's recent trading range, making the transaction financially viable for the option holders.

As a further inducement, for every share purchased through this exercise, investors will receive new, unregistered preferred investment options to purchase two additional shares of common stock. These 1,617,190 new options will have an even lower exercise price of $2.325 per share. They become exercisable immediately and will expire thirty months after a resale registration statement is filed with the Securities and Exchange Commission (SEC), giving investors a long-term, low-cost path to increase their stake in the company.

This type of structured financing is a specialty of firms like H.C. Wainwright & Co., which often assist growth-stage companies in the biotech and wellness sectors that face challenges in accessing capital through more traditional means. While effective at generating funds, these deals often come at the price of future equity dilution.

A Lifeline Amidst Financial Headwinds

The $2.1 million raise, while modest, is critical for Arcadia. The company's financial performance has been under pressure, underscoring the necessity of the deal. Over the last twelve months, Arcadia's stock (RKDA) has plummeted by 45%, with its market capitalization shrinking to just under $4 million. The company has a history of net losses, reporting a loss of $5.1 million in the third quarter of 2025 and an annual loss of $7.0 million for the fiscal year 2024.

Perhaps more pressingly, the company has been burning through cash. Operating activities consumed $7.2 million in fiscal 2024, and its cash balance has dwindled. The press release states the net proceeds will be used for “working capital and general corporate purposes,” a broad term that, in this context, points directly to funding day-to-day operations, paying salaries, and covering other essential business expenses. Without this infusion, the company's ability to continue its operations and planned activities would be in question.

This financial reality provides the crucial context for the transaction. It is less a proactive move to fund a major expansion and more a necessary step to stabilize the company and provide a runway for its current strategy to succeed.

A Strategic Pivot to Wellness

This capital raise comes at a pivotal moment for Arcadia. The company has been actively streamlining its business to focus squarely on its high-growth wellness product portfolio. This strategy became clearer following the termination of a planned business combination with Roosevelt Resources, Inc. in late December 2025. The all-stock deal, which would have merged Arcadia with an agricultural entity, fell through, pushing Arcadia to double down on its internal growth drivers.

The most promising of these is the Zola® coconut water brand. The brand has been a standout performer, with revenues soaring 124% in the fourth quarter of 2024 and continuing with a 90% year-over-year increase in the first quarter of 2025. Distribution for Zola® has expanded by 70%, and the company has maintained gross margins above 30% for several consecutive quarters. This success has been bolstered by strategic divestments, including the sale of its GoodWheat™ assets and select patents, which have helped eliminate liabilities and sharpen the company's focus.

The $2.1 million in new capital is the fuel required to keep this engine running. The funds will likely be directed toward marketing, inventory, and further distribution expansion for the Zola® brand, which represents Arcadia's clearest path to profitability and sustainable growth.

The Dilution Dilemma for Shareholders

For existing shareholders, the transaction is a double-edged sword. On one hand, the capital is essential for the company's survival and the potential success of the Zola® brand, which could ultimately drive the stock price higher. On the other hand, the deal comes at a significant cost in the form of shareholder dilution.

The exercise of the old options and the creation of over 1.6 million new options will substantially increase the total number of outstanding shares if and when they are all exercised. This means each existing share will represent a smaller percentage of ownership in the company. For a company with a market cap of less than $4 million, adding over 2.4 million potential new shares into the market is a material event.

However, this was likely the only viable path forward. The original $9.00 options were providing no value to the company or investors. By repricing them and adding new warrants, Arcadia created a deal that was attractive enough to bring in cash. The transaction underscores the difficult reality for many small-cap public companies: when the stock price falls, raising capital often requires sacrificing a larger piece of the company's future equity. The success of this strategy now hinges entirely on management's ability to use this new runway to translate Zola's revenue growth into company-wide profitability, thereby creating long-term value that outweighs the immediate cost of dilution.