Beyond the Megafarms: 4 Alternative Models For Indoor Agriculture

In the largest ever transaction for an agriculture technology startup, not only does the idea of growing produce indoors, in an automated high-tech environment capture the imagination of many buyers and readers, but just last month, an indoor farming business secured a whopping $200 million in backing . South San Francisco’s Plenty pulled in the funding from SoftBank along with affiliates of Louis M.

High-tech indoor farming has captured the imagination of the media as well. In fact, you could say that indoor farming is the crossover hit of the agtech world — a niche story that has made it into the mainstream. But like a country song that hits the pop charts for a while, high-tech, high-cost indoor vertical farming groups like Plenty are not necessarily representative of the form all indoor farming operations take.

Some say that the high rate tag of building indoor vertical megafarms makes profitability a distant dream — AeroFarms’ flagship facility in Newark will cost about $40 million when fully complete. They are of course faced with a healthy dose of skepticism too; some industry insiders say that lower-cost, smaller-scale operations are not financially sustainable long term due to the high cost of labor and lack of efficiency. The firm has farms in Detroit and Bridgeport, CT, and soon will have one in Rotherham, UK, all in cooperation with local universities.

Per to The business, its aeroponic growing systems and estate management software are simple enough to hire unskilled labor and therefore make a larger impact at the community level through job creation. “The GCF Platform — a hybrid between best-in-class aeroponics and cloud-based computing — is designed to be an effective and simple solution right out of the box,” stated co-founder Daniel Casanas. Founder Ronald Reynolds sees his distributed — or franchised — model of urban farming as lower risk to a large megafarm because of the disease. Pest risk associated with concentrated growing at scale. “If you have 10-, 6-, 7,000 sq ft, you still add up to 60,000 sq ft. Going to Reynolds, the high-profile megafarms are in a chicken and egg cycle, with investor money following this one business model and then entrepreneurs recreating it since that’s where the money is. “The business models are trying to follow where the perceived money is coming from.

Freight Farms Boston-based Freight Farms is one of the older players in the indoor, vertical space, having been around since 2011. The container holdings sell for about $85,000 in the US and have the growing potential equivalent to eight acres of land.

Freight Farms has offices in the US and Europe along with a l icensed dealer in the Middle East . In June, Freight Farms , completed its Series B financing round of $7.3 million, raising the backing from existing investor Boston-based Spark Capital along with new investor Stage 1 Ventures with support from early investors like Launch Capital.

Freight Farms has now secured a total of $12 million and deployed more than 100 farms that use hydroponic technology, LED lighting, and automated watering and fertilizing technology. Fresh Box Farms Sitting in between a few of these models is Fresh Box Farms, a Boston-based indoor operation right now farming out of shipping containers, but soon building a facility the equivalent to 200 of those, admittedly moving on from the container model.

That said, Vosburg’s larger holding will have rooms within it to provide more precise temperature control for different plants. “You just can’t grow efficiently in a large warehouse because basil does not like to grow at the same temperature as romaine and different cultivars like wildly different CO2 levels,” he told reporters. Fresh Box Farms has secured more than $10 million to date from individual backers and family offices. The indoor vertical farming industry as a whole is far from maturity and perhaps decades away from competing with the Salinas Valley in leafy greens production.

As it grows and matures it may prove weighty to remember that there is more variety in indoor farming businesses than makes the news.