A Future Farming Industry Grows In Brooklyn

The startup Square Roots is training the next generation of urban farmers in a Bed-Stuy parking lot.

By Alexander C. Kaufman, Joseph Erbentraut

ROOKLYN, New York ― Tobias Peggs is already cultivating leafy vegetables out of purple-lit shipping containers in the parking lot of an old Pfizer factory, just blocks from the projects where the rapper Jay-Z grew up.

What he needs to grow now is an industry.

Eight months ago, Peggs co-founded Square Roots ― a startup that coaches and equips would-be urban farmers with growing materials in repurposed 320-square-foot metal crates. He launched the venture with food and tech entrepreneur Kimbal Musk, the younger brother of Tesla and SpaceX CEO Elon Musk.

Now, 10 farmers are enrolled in Square Roots’ Brooklyn farming program, Peggs and Musk have launched a new delivery service for home-grown salad greens, and they’re deciding where to expand next.

“If we have a campus like this in every city, everyone can buy food from a local farmer,” said Peggs, 45, said as he showed The Huffington Post around his operation.

Located in the shadow of the Marcy Houses, a public housing complex in Brooklyn’s Bedford-Stuyvesant neighborhood, the former pharmaceutical plant that houses Square Roots now also provides office space for scientific research ventures and startups that ferment kombucha and kimchi, make high-end slushies and Madagascan chocolate, and even grow live oysters.

Peggs is Square Roots’ chief executive, and he has lofty plans to topple the industrial giants that dominate grocery aisles. “This is a very long-term play, to bring real food to everyone and unleash, basically, the next generation of leaders in food.”

“Ambitious,” he added with a laugh.

Square Roots was launched under the umbrella of The Kitchen LLC, Musk’s equally ambitious chain of farm-to-table eateries that he hopes will one day take over the food industry sector that TGI Friday’s and Applebee’s currently dominate.

Musk, 44, draws his inspiration from Chipotle Mexican Grill, where he serves as a board member. Chipotle leveraged its use of fresh, non-genetically modified ingredients to become a major rival of McDonald’s, despite charging higher prices. The Kitchen, which has three different restaurant concepts, operates primarily out of the American heartland, with nearly a dozen locations in Chicago, Memphis and throughout the state of Colorado. Another restaurant is slated to open in Indianapolis this year.

Musk and his colleagues are looking at all of those cities as the next possible site for a Square Roots campus.

“My heart is in Memphis, so if it were up to me, that’d be our next city,” Musk told HuffPost on Thursday, stressing that it’s ultimately up to Peggs. He wants to see Square Roots expand rapidly. “We are planning on doing this with thousands of kids a year within a few years.”

If we have a campus like this in every city, everyone can buy food from a local farmer.Tobias Peggs, chief executive of Square Roots

In Colorado, where The Kitchen is headquartered, it’s easy to get local produce, meat and alcohol. But that’s not true in a lot of major cities. That’s the niche Square Roots wants to fill. The company is the country’s first major indoor farming “accelerator” ― Silicon Valley parlance for firms that offer educational training, space and capital to bootstrapped entrepreneurs.

Enrollees complete an eight-week boot camp before setting up shop in one of Square Roots’ 10 shipping containers. They then have the next 10 months to grow vegetables and come up with novel ideas to sell them. Square Roots makes money by taking a cut of the revenue. If an idea takes off, Square Roots buys a stake in the company and introduces the farmer to other investors.

“I visualize opening Fortune magazine in 2050, and there’s a list of the top 100 food companies in America,” Peggs said. “No. 1 is Square Roots. And the other 99 have all been set up by folks who graduated from Square Roots.”

Indoor and vertical farming, essentially a techy subset of greenhouse agriculture, has recently attracted entrepreneurs competing to develop new hardware and the most energy- and water-efficient growing systems. 

The benefits of growing indoors are numerous. Farmers don’t need pesticides or herbicides to ward off unwanted pests. They evade droughts, temperature shifts, whipping winds and flooding rains, all of which are becoming more destructive and erratic as greenhouse gases warm the planet and alter the climate. They are free from environmental contaminants ― a big plus in places like Japan, where, since the 2011 Fukushima Daiichi nuclear disaster, people fear radiation poisoning from food grown outdoors.

And on a baseline level, vegetables grown indoors under precise conditions can be bred to taste better. Peggs said one Square Roots farmer who is cultivating shiso, a red-leafed mint, used data on the climate in Hokkaido, Japan’s breadbasket northernmost island, to replicate conditions there. Instead of raising crops in one country and shipping them to another to be eaten, farmers could cut out the financial and environmental costs of transportation and grow even exotic produce in the dead of a New York winter.

“Let’s say the best basil you ever had was on vacation in Italy in 2006,” Peggs said. “You could look up the data on rainfall, temperatures and weather and grow basil in those exact same conditions.”

In September, Square Roots began working with the U.S. Department of Agriculture to rewrite criteria for government-backed loans, making them more accessible to indoor, urban growers.

The USDA postponed a meeting with Peggs scheduled for Thursday afternoon, hours after agriculture secretary nominee Sonny Perdue testified before a Senate hearing. The USDA did not respond to questions on Friday about the status of changes to the loan applications.

“We want these kids to know they’ll be getting a loan, and they’ll have to pay it back and have to build a business and make money for themselves all in the space of one year,” Musk said. “It’s a loan, not a grant. It’s not a handout; these are real businesses.”