Infarm Raises $170M In Equity And Debt To Continue Building Its ‘Vertical Farming’ Network

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Steve O'Hear@sohear

September 17, 2020

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Image Credits: Infarm

Infarm, the vertical farming company that has built a network of urban farms to grow fresh food closer to consumers, has raised $170 million in new investment in a “first close” of a Series C.

Leading the round — which is expected to reach $200 million and is a mixture of equity and debt — is LGT Lightstone,  with participation from Hanaco, Bonnier, Haniel, and Latitude. Existing Infarm investors Atomico, TriplePoint Capital, Mons Capital, and Astanor Ventures also followed on. It brings the company’s total funding to date to more than $300 million.

That’s likely a testament to the speed of new retail partnerships over the last 12 months. They include Albert Heijn (Netherlands), Aldi Süd (Germany), COOP/Irma (Denmark), Empire Company’s Sobeys, Safeway and Thrifty Foods (Canada), Kinokuniya (Japan), Kroger (U.S.) and Marks & Spencer and Selfridges (U.K.).

With operations across 10 countries and 30 cities worldwide, Infarm says it now harvests more than 500,000 plants monthly, and in a much more sustainable way than traditional farming and supply chains. Its modular, IoT-powered vertical farming units claim to use 99.5% less space than soil-based agriculture, 95% less water, 90% less transport, and zero chemical pesticides. In addition, 90% of the electricity used throughout the Infarm network is from renewable energy and the company has set a target to reach zero emission food production next year.

Founded in 2013 by Osnat Michaeli, and brothers Erez and Guy Galonska, Infarm’s “indoor vertical farming” system is capable of growing herbs, lettuce and other vegetables. It then places these modular farms in a variety of customer-facing city locations, such as grocery stores, restaurants, shopping malls and schools, thus enabling the end-customer to actually pick the produce themselves. To further scale, it also installs Infarms in local distribution centers.

The distributed system is designed to be infinitely scalable — you simply add more modules, space permitting — whilst the whole thing is cloud-based, meaning the farms can be monitored and controlled from Infarm’s central control center. It’s also incredibly data-driven, a combination of IoT, Big Data and cloud analytics akin to “Farming-as-a-Service.”

The idea, the founding team told me back in 2017 when I profiled the nascent company, isn’t just to produce fresher and better-tasting produce and re-introduce forgotten or rare varieties, but to disrupt the supply chain as a whole, which remains inefficient and produces a lot of waste.

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“Behind our farms is a robust hardware and software platform for precision farming,” explained Michaeli at the time. “Each farming unit is its own individual ecosystem, creating the exact environment our plants need to flourish. We are able to develop growing recipes that tailor the light spectrums, temperature, pH and nutrients to ensure the maximum natural expression of each plant in terms of flavor, color and nutritional quality.”

On that note, I caught up with two of Infarm’s founders to get a brief update on the Berlin-headquartered company and to dive a little deeper into how it will continue to scale.

TechCrunch: What assumptions did you make early on that have turned out to be true or, more interestingly, not panned out as expected?

Osnat Michaeli: When we first chatted about four years ago, we were 40 people in Berlin, and much of the conversation centered around the potential that our approach to urban vertical farming might have for retailers. While for many it was intriguing as a concept, we couldn’t have imagined that a few years later we would have expanded to almost 10 countries (Japan is on its way) and 30 cities, with partnerships with some of the largest retailers in the world. Our assumptions at the time were that retailers and their customers would be attracted to the taste and freshness of produce that grew right in front of them in the produce section, in our farms.

What we didn’t anticipate was how much and how quickly the demand for a sustainable, transparent, and modular approach to farming would grow as we, as a society, begin to feel the impact of climate change and supply chain fragility upon our lives, our choices and our food. Of course, we also did not anticipate a global pandemic, which has underscored the urgency of building a new food system that can democratize access to high-quality, amazing-tasting food, while helping our planet regenerate and heal. The past few months have confirmed the flexibility and resilience of our farming model, and that our mission is more relevant than ever.

In terms of signing on new retailers, based on your progress in the last 12 months, I’m guessing this has gotten easier, though undoubtedly there are still quite long lead times. How have these conversations changed since you started?

Erez Galonska: While lead times and speed of conversations can vary depending upon the region and retailer. In mature markets where the concept is familiar and we’re already engaged, deal conversations can reach maturity in as little time as three months. Since we last spoke we are already working with most of the leading retailers that are well established in Europe, the U.K., and North America. Brands which in each of their markets are both forerunners in a retail industry rapidly evolving to meet the demand for consumer-focused innovation, while proving that access to sustainable, high-quality, fresh, and living produce is not only possible, but can be available in produce aisles today, and every day of the year, with Infarm.

I’m interested to understand where Infarms are installed, in terms of if the majority is in-store and consumer-facing or if the most scalable and bulk of Infarm’s use cases are really much larger distribution hubs in cities or close to cities, i.e. not too far away from places with population/store density but not actually in stores. Perhaps you can enlighten me on what the ratio looks like today and how you see it developing as vertical farming grows?

Erez Galonska: Today across our markets, the split between our farms in stores and in distribution centers is roughly 50/50. However, as you anticipate, we will be expanding our network this year with many more distribution hubs. This expansion will likely lead to an 80/20 split as early as next year, with the majority of our regions being served with fresh, living produce delivered throughout the week from centrally located hubs. This not only offers retailers and restaurants flexibility in terms of volumes of output, and the ability to adapt the presentation of our offerings to floor areas of different sizes, but it also allows us to begin to serve whole regions from our next-generation farms under development today.

Based in our hubs, these farms will deliver the crop equivalent of an acre or more of fresh produce on a 25 m2 footprint, with significant further savings in energy, water, labor and land use. We believe this technology will truly challenge ideas of what is possible in sustainable, vertical farming and we look forward to talking about it more soon.

Lastly, what are the main product lines in terms of food on the shelves?

Osnat Michaeli: We have a catalog of more than 65 herbs, microgreens, and leafy greens that is constantly growing. Our offerings range from the known and common varieties like Coriander, Basil, or Mint, to specialty products like Peruvian Mint, Red Veined Sorrel or Wasabi Rucola.

Because our farms give us excellent control over every part of a plant’s growth process and can imitate the complexity of different ecosystems, we will be able to expand the diversity of Infarm produce available to consumers to include root vegetables, mushrooms, flowering crops, and even superfoods from around the world in the near future. What you see today with Infarm is still only the beginning.

Prima Wawona Peaches Shipped To More Than A Dozen Countries

Chris Koger

August 30, 2020

Prima Wawona peaches involved in a recall in the U.S. and Canada because of salmonella were shipped to more than a dozen other countries.

So far, Canada, Singapore, and New Zealand have recalled the peaches, according to an Aug. 28 notice from the Food and Drug Administration. Prima Wawona/Wawona Packing of Fresno, Calif., recalled peaches on Aug. 21, followed by a recall in Canada. The Singapore Food Agency recalled the peaches from importer Satoyu Trading Pte Ltd. on Aug. 25, and New Zealand Food Safety on Aug. 26 recalled bulk peaches from the company that went to retailers.

The Prima Wawona peaches also went to: Australia, China, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Panama, the Philippines, Taiwan, and the United Arab Emirates. The FDA has alerted the food safety agencies in those countries.

No illnesses have been reported in those countries. As of Aug. 23, Canada had reported 33 cases of Salmonella Enteritidis. As of Aug. 27, there were 78 people sick from the peaches in 12 states.

In the U.S., bulk peaches sold from June 1 to Aug. 3, and bagged conventional and organic peaches in two-pound bags sold from June 1 through Aug. 19 were recalled by Prima Wawona.

Retailers that received peaches, according to the FDA, are Aldi, Food Lion, Hannaford, Kroger (Jay-C, King Soopers, City Market, Fry’s, Ralphs, Food 4 Less, Foods Co., and Smiths), Target, Walmart, and Wegmans.

Russ Davis Wholesale, Wadena, Minn., recalled Crazy Fresh and Quick & Easy brand peach salsas made with the peaches on Aug. 25, as well as gift baskets that included the peaches.

Related stories: (UPDATED) Prima Wawona recalls bagged, bulk peaches (UPDATED) Wawona brand peaches linked to salmonella outbreak

US: Throw Away Your Onions, They're Being Recalled Over Salmonella

It Started With Red Onions, But Now The Recall

Has Expanded Quite A Bit

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By Dustin Nelson

Updated on 8/14/2020

The FDA says you probably need to chuck your onions in the bin. A recall of the delicious tear-inducing vegetable is happening over a "multistate outbreak of Salmonella Newport infections."

The FDA has tracked the outbreak back to Thomson International, Inc. in California, but if you're like me, the onions in your kitchen don't have a label on them. In that case, the FDA says you should throw them out. "If you cannot tell if your onion is part of the recall, or your food product contains recalled onions, you should not eat, sell, or serve it, and should throw it out," the FDA says in its announcement. 

Anything from Thomson shipped since May 1, 2020, is part of the recall. 

The initial recall was on red onions, which are believed to be the source of the problem. However, the recall has expanded to include red, yellow, white, and sweet yellow onions due to the potential for cross-contamination. Currently, the CDC is reporting cases of Salmonella in 34 states with 396 reported illnesses and 59 hospitalizations. The name of the company may not be familiar, but the products have been distributed in all 50 states, the District of Columbia, and Canada, where there is also a recall. The US recall started on August 1, a day after the Public Health Agency of Canada issued a recall on red onions from Thomson International."

The onions were distributed... under the brand names Thomson Premium, TLC Thomson International, Tender Loving Care, El Competitor, Hartley’s Best, Onions 52, Majestic, Imperial Fresh, Kroger, Utah Onions, and Food Lion," the recall states. You can find a list of label images in the FDA recall.

There are a whole lot of varieties of the recalled packaging, with some having been sold at Kroger and Walmart locations. 

The FDA and CDC ask that anyone experiencing symptoms contact their health care provider immediately. Symptoms of salmonellosis include diarrhea, fever, and stomach cramps. If it gets more severe, symptoms may also include a fever, aches, headaches, lethargy, rash, and blood in urine or stool, the FDA says.

So, check the kitchen and don't risk it.

Lead photo: SHUTTERSTOCK.COM

Publix Grows Hydroponic Produce At Greenwise Store

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Krishna Thakker@krishna_thakker

Aug. 3, 2020

Dive Brief:

• Publix has partnered with local hydroponics firm Brick Street Farms to grow, pack and harvest hydroponic lettuce in a container farm located outside its Lakeland, Florida Greenwise Market store. 

• The 40-foot container farm will grow an equivalent of 2.5 to 3 acres of lettuce and can operate 365 days a year in any weather conditions, Brick Street Farms told Grocery Dive in an emailed announcement. It substitutes soil for mineral-rich water, which means no pesticides are needed. The container farm uses 90% less water than a traditional farm and produces 720 heads of lettuce each week. 

• Customers can watch the produce grow through a window on the side of the container and purchase heads of lettuce inside the store.

Explore how the current landscape is impacting coffee manufacturers and how organic and fair trade can help ensure long-term success of the industry.

Dive Insight:

Publix has recently stepped up its partnerships in alternative agriculture. Earlier this year, the company began hosting Vertical Roots' interactive mobile hydroponic farm in the parking lots of its grocery stores and Greenwise locations. In March, Publix began selling microgreens from Kalera, a hydroponic farm on top of a Marriott hotel that lost all its business due to coronavirus, at 165 stores.

Hydroponic farming has been plagued by inefficiencies and high costs in the past, but improvements in technology are helping suppliers better meet retailers' demands for pricing and scale. On-site farms also add a bit of theater that can draw curious shoppers to stores. 

Publix isn’t the only food retailer exploring this field. Kroger last year installed mini hydroponic farms in a handful of Seattle stores in partnership with Infarm, a start-up based in Germany. Around the same time, Gordon Food Service and indoor farming startup Square Roots opened their first co-located hydroponics farm on Gordon’s headquarters in Wyoming, Michigan. H-E-B and Whole Foods have also experimented with hydroponics in and around their stores.

Having a hydroponic farm at the store removes the need for transportation and storage of lettuce before it hits shelves, according to Brick Street Farms. It also allows Publix to sell the produce in-season all year round, providing some supply stability.

Although omnichannel business is booming for grocers like Publix right now, many are looking for ways to drive traffic to their stores, where they can make the most money per order. Grow farms and other safe, eye-catching attractions could be one way to accomplish this.

Follow Krishna Thakker on Twitter

Lead Photo: Permission granted by Publix

Filed Under: Fresh food Natural/organic