AppHarvest, Inc. Announces Full-Year 2020 Financial Results

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February 26, 2021

Urbanagnews

Company Introduces First Quarter 2021 Outlook and Updates Full-Year 2021 Forecast

MOREHEAD, Ky. — AppHarvest, Inc. (NASDAQ: APPH, APPHW) (“AppHarvest” or “the Company”), a leading AgTech company and Certified B Corp building and operating some of the country’s largest high-tech indoor farms to sustainably grow affordable, nutritious, chemical pesticide-free non-GMO fruits and vegetables at scale using up to 90 percent less water than traditional open-field agriculture and 100 percent recycled rainwater, announced today its financial results for the full year ended December 31, 2020.

Fiscal Year 2020 Highlights

• Net loss of $17.4 million, compared to $2.7 million in the prior year period in 2019

• Adjusted EBITDA loss of $15.7 million, compared to $2.6 million in the prior year period in 2019

AppHarvest was in a pre-revenue state in 2020 as the company scaled to prepare to become a publicly-traded company and as it ramped up to plant its first crop at its flagship facility, which began harvesting in January of 2021. In 2020, AppHarvest implemented its pioneering AgTech platform, which the company developed through international and advanced technology partnerships with the Dutch government, GE, Signify, Priva, Moleaer, Ecoation and others. Powered by these technologies, AppHarvest is able to drive higher crop yields. The Dutch government is a proven partner with the Netherlands being the No. 2 food exporter in the world because of its controlled environment farming expertise. AppHarvest is leveraging this model at a scale to effectively serve the U.S. market and introduce innovations such as a hybrid lighting array with traditional high-pressure sodium grow lights with LEDs that result in 40 percent reduced energy use. AppHarvest utilizes technology that continuously analyzes data from sophisticated digital monitoring systems composed of more than 300 sensors to analyze micro-climates to optimize growth with tomato plants reaching upwards of 40-feet tall and the first farm alone is expected to produce over 40 million pounds of tomatoes annually.

Business Combination

On January 29, 2021, AppHarvest and Novus Capital Corp., a special purpose acquisition company, completed their business combination to form AppHarvest, Inc. The common stock and warrants of AppHarvest, Inc. began trading on Nasdaq under the new ticker symbols “APPH” and “APPHW,” respectively, on Monday, February 1, 2021. Please see the press release dated February 1, 2021, on AppHarvest’s Investor Relations website for more details related to the business combination at https://investors.appharvest.com/news-and-events/news-releases.

Subsequent to the business combination, AppHarvest had 97,925,153 shares of common stock outstanding. The business combination provided the Company approximately $475.0 million of unrestricted cash, including $375.0 million in gross proceeds from the fully committed common stock PIPE. The transaction proceeds will be used to fund operations, including building additional high-tech controlled environment indoor farms, support growth and for other general corporate purposes, including to fund potential future investments and acquisitions.

First Quarter 2021 Outlook and Fiscal Year 2021 Forecast

The Company currently expects the following results for its first quarter ended March 31, 2021:

• Net revenue to be in the range of $2.1 million to $2.6 million

• Adjusted EBITDA loss to be in the range of $14 million to $16 million

The Company currently expects the following results for its fiscal year ending December 31, 2021:

• Net revenue to be in the range of $20 million to $25 million

• Adjusted EBITDA loss to be in the range of $43 million to $45 million

The Company noted that its expectations are based on information available at the time of this release, and are subject to changing conditions, many of which are outside the Company’s control.

“Our favorable crop yields and market pricing currently support a 2021 sales outlook that is better than we expected in December 2020,” said AppHarvest Founder & Chief Executive Officer Jonathan Webb. “In January 2021, we delivered our first harvest of tomatoes from our flagship 63-acre indoor farm and began shipping to select national grocery retailers. We remain focused on our mission to build a resilient domestic food system for the U.S. to support this outlook in our first year as a public company.”

In addition to better than anticipated crop yields and pricing, the Company has benefited from a temporary decline in market supply related to recent extreme winter weather conditions that prevented transport of produce through Texas from Mexico and that resulted in significant amounts of food waste. Part of AppHarvest’s mission is to create a climate-resilient domestic food system for the U.S. to prevent such supply chain disruptions.     

About AppHarvest

AppHarvest, a public benefit corporation, and Certified B Corp, is an applied technology company building some of the world’s largest indoor farms in Appalachia. The Company combines conventional agricultural techniques with cutting-edge technology and is addressing key issues including improving access for all to nutritious food, farming more sustainably, building a home-grown food supply, and increasing investment in Appalachia. The Company’s 63-acre Morehead, Kentucky facility is among the largest indoor farms in the U.S. For more information, visit https://www.appharvest.com/.

Agritecture Partners With Mainvest To Democratize Urban Agriculture Financing

Boston, Massachusetts, February 16, 2021​ - Agritecture, LLC, an urban farming consulting and digital services firm, announced it has partnered with Mainvest, a small business investment platform that connects local entrepreneurs with investors who care.

The two companies will work together to accelerate the urban farming and controlled environment agriculture (CEA) industry across the country by offering new entrepreneurs a more accessible way to raise capital for small-scale or pilot facilities. ​Research​ has shown that urban agriculture provides a range of crucial ecosystem services valued at $33+ billion.

“We’ve seen a great deal of success in the F&B industry fueled by a need for alternative sources of capital and demand from community members for tangible ways to support local brands,” stated Nicholas Mathews, Mainvest CEO and Co-Founder. “As sustainable investment becomes mainstream and urban farming projects increase, we see a niche for our services further up in the local food supply chain. We’re excited to connect innovative entrepreneurs in the urban agriculture sector with retail investors across experience and income levels looking to get involved in a growing industry. We’re excited to partner with Agritecture on empowering the industry to raise capital on more favorable terms with the support of active and engaged communities.”

In 2020, the USDA offered the availability of only $3M in ​grants​ for urban agriculture and innovative production to just 10 projects - despite receiving 578 applicants. While the CapEx, or startup cost, can vary widely for these projects, ​Agritecture notes that nearly 30% of controlled environment farms modeled via their ​Agritecture Designer​ digital platform have a CapEx of less than $250,000 - likely a pilot facility for an entrepreneur who wants to start small and learn before scaling up.

“Since our founding in 2014, we’ve seen sustained, year-over-year growth in interest toward urban agriculture, especially amongst industry newcomers,” said Henry Gordon-Smith, Founder and CEO of Agritecture.

This growth has only accelerated since the onset of the pandemic, according to the team at Agritecture, which reported nearly a 2x increase in website traffic since Q1 of 2020.

But despite increasing interest in urban agriculture, and record levels of funding for a handful of indoor mega-farms, financing continues to be a major pain point for small and medium-scale CEA businesses. “Through hundreds of consultations and economic models developed over the

past seven years, we know that these farms can achieve profitability with competitive payback periods, while still serving their local markets and communities,” noted Gordon-Smith.

Gordon-Smith cites Agritecture’s ​2019 and 2020 Global CEA Census Reports​, produced alongside agtech solutions provider Autogrow, which show that nearly half of all CEA facilities are being started by those with no previous farming experience. Furthermore, per their recent census, 78 percent of CEA business founders who attempted to raise money were unsuccessful in doing so through traditional financing sources, such as banks.

“By teaming up with Mainvest and their innovative financing platform, we can now deliver a direct link from our planning services and digital platform, Agritecture Designer, to critical funding opportunities for these pilot and small-scale facilities,” added Gordon-Smith.

About Agritecture

Agritecture, LLC is the global leader in urban agriculture advisory services, having worked on over 120 projects in more than 25 countries. Based out of New York, Agritecture is on a mission to empower key stakeholders and accelerate the agriculture industry with climate-smart strategies through a proven methodology, real-world data, and an expansive network.

For more information, please visit ​agritecture.com​.

About Mainvest

Mainvest is an online investment platform for building communities and the American Dream. At Mainvest, people can directly invest in businesses they want to see in their own neighborhoods, generating both potential ROI (return on investment) and ROC (return on community). Visit mainvest.com​ to see the potential impact you can have on a community you care about.

For more information, please visit ​mainvest.com/for-businesses/urban-ag​.

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For more information about Mainvest, please contact Domenick Bauer at domenick@mainvest.com​.

For more information about Agritecture, please contact Briana Zagami via email at briana@agritecture.com​.

US - COLORADO: Urban-Gro Closes $62 Million Public Offering

urban-gro has closed its previously announced public offering of 6,210,000 shares of the Company’s common stock at a public offering price of $10.00 per share, which includes 810,000 shares sold upon full exercise of the underwriter’s option to purchase additional shares. The gross proceeds from the offering, including the exercise of the over-allotment option, were $62,100,000 before deducting underwriting discounts, commissions, and offering expenses.

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The Company intends to use the net proceeds to support organic growth, to expand in the European CEA market, for general corporate purposes, including to fund potential future investments and acquisitions of companies that the Company believes will complement its business and growth strategy and to repay certain outstanding indebtedness.

ThinkEquity, a division of Fordham Financial Management, Inc., acted as sole book-running manager for the offering.

For more information:
urban-gro
720-390-3880
marketing@urban-gro.com  
urban-gro.com    

18 Feb 2021

Investors Seed Indoor Farms As Pandemic Disrupts Food Supplies

Wausau, WI, USA Stevens Point

Feb 18, 2021

By Rod Nickel

(Reuters) - Investors used to brush off Amin Jadavji's pitch to buy Elevate Farms’ vertical growing technology and produce stacks of leafy greens indoors with artificial light.

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"They would say, 'This is great, but it sounds like a science experiment,'" said Jadavji, CEO of Toronto-based Elevate.

Now, indoor farms are positioning themselves as one of the solutions to pandemic-induced disruptions to the harvesting, shipping, and sale of food.

"It's helped us change the narrative," said Jadavji, whose company runs a vertical farm in Ontario, and is building others in New York and New Zealand.

Proponents, including the U.S. Department of Agriculture (USDA), say urban farming increases food security at a time of rising inflation and limited global supplies. North American produce output is concentrated in Mexico and the U.S. Southwest, including California, which is prone to wildfires and other severe weather.

Climate-change concerns are also accelerating investments, including by agribusiness giant Bayer AG, into multi-storey vertical farms or greenhouses the size of 50 football fields.

They are enabling small North American companies like BrightFarms, AppHarvest and Elevate to bolster indoor production and compete with established players AeroFarms and Plenty, backed by Amazon.com Inc founder Jeff Bezos.

But critics question the environmental cost of indoor farms' high power requirements.

Vertical farms grow leafy greens indoors in stacked layers or on walls of foliage inside of warehouses or shipping containers. They rely on artificial light, temperature control and growing systems with minimal soil that involve water or mist, instead of the vast tracts of land in traditional agriculture.

Greenhouses can harness the sun's rays and have lower power requirements. Well-established in Asia and Europe, greenhouses are expanding in North America, using greater automation.

Investments in global indoor farms totaled $394 million in 2020, AgFunder research head Louisa Burwood-Taylor said.

The average investment last year doubled in size, as large players including BrightFarms and Plenty raised fresh capital, she said.

A big funding acceleration lies ahead, after pandemic food disruptions - such as infections among migrant workers that harvest North American produce - raised concerns about supply disruptions, said Joe Crotty, director of corporate finance at investment bank KPMG, which advises vertical farms.

"The real ramp-up is the next three to five years," Crotty said.

Vegetables grown in vertical farms or greenhouses are still just a fraction of overall production. U.S. sales of food crops grown under cover, including tomatoes, cucumbers and lettuce, amounted to 790 million pounds in 2019, up 50% from 2014, according to the USDA.

California's outdoor head lettuce production alone was nearly four times larger, at 2.9 billion pounds.

USDA is seeking members for a new urban agriculture advisory committee to encourage indoor and other emerging farm practices.

PLANT BREEDING MOVES INDOORS

Bayer, one of the world's biggest seed developers, aims to provide the plant technology to expand vertical agriculture. In August, it teamed with Singapore sovereign fund Temasek to create Unfold, a California-based company, with $30 million in seed money.

Unfold says it is the first company focused on designing seeds for indoor lettuce, tomatoes, peppers, spinach and cucumbers, using Bayer germplasm, a plant's genetic material, said Chief Executive John Purcell.

Their advances may include, for example, more compact plants and an increased breeding focus on quality, Purcell said.

Unfold hopes to make its first sales by early 2022, targeting existing farms, and start-ups in Singapore and the United Kingdom.

Greenhouses are also expanding, touting higher yields than open-field farming.

AppHarvest, which grows tomatoes in a 60-acre greenhouse in Morehead, Kentucky, broke ground on two more in the state last year. The company aims to operate 12 facilities by 2025.

Its greenhouses are positioned to reach 70% of the U.S. population within a day's drive, giving them a transportation edge over the southwest produce industry, said Chief Executive Jonathan Webb.

"We're looking to rip the produce industry out of California and Mexico and bring it over here," Webb said.

Projected global population growth will require a large increase in food production, a tough proposition outdoors given frequent disasters and severe weather, he said.

New York-based BrightFarms, which runs four greenhouses, positions them near major U.S. cities, said Chief Executive Steve Platt. The company, whose customers include grocers Kroger and Walmart, plans to open its two largest farms this year, in North Carolina and Massachusetts.

Platt expects that within a decade, half of all leafy greens in the United States will come from indoor farms, up from less than 10% currently.

"It's a whole wave moving in this direction because the system we have today isn’t set up to feed people across the country," he said.

'CRAZY, CRAZY THINGS'

But Stan Cox, research scholar for non-profit The Land Institute, is skeptical of vertical farms. They depend on grocery store premiums to offset higher electricity costs for lighting and temperature control, he said.

"The whole reason we have agriculture is to harvest sunlight that’s hitting the earth every day," he said. "We can get it for free."

Bruce Bugbee, a professor of environmental plant physiology at Utah State University, has studied space farming for NASA. But he finds power-intensive vertical farming on Earth far-fetched.

"Venture capital goes into all kinds of crazy, crazy things and this is another thing on the list."

Bugbee estimates that vertical farms use 10 times the energy to produce food as outdoor farms, even factoring in the fuel to truck conventional produce across country from California.

AeroFarms, operator of one of the world's largest vertical farms, a former New Jersey steel mill, says comparing energy use with outdoor agriculture is not straightforward. Produce that ships long distances has a higher spoilage rate and many outdoor produce farms use irrigated water and pesticides, said Chief Executive Officer David Rosenberg.

Vertical farms tout other environmental benefits.

Elevate uses a closed loop system to water plants automatically, collect moisture plants emit and then re-water them with it. Such a system requires 2% of the water used on an outdoor romaine lettuce operation, Jadavji said. The company uses no pesticides.

"I think we're solving a problem," he said.

(Reporting by Rod Nickel in Winnipeg, Manitoba; additional reporting by Karl Plume in Chicago; Editing by Caroline Stauffer and Lisa Shumaker)

Farmland Asset Class Holds Strong During Volatile Year; Learn More At Global AgInvesting Events

NEW YORK (January 29, 2021) – Global AgInvesting (GAI) will host the preeminent community of agriculture investment stakeholders at a special edition of its flagship U.S. gathering on 13-15 July 2021 at the prestigious Sleepy Hollow Country Club here, just an hour north of NYC. Uncompromising industry-leading content and networking opportunities will be presented in-person while providing extra precautions for safety at this all-outdoor event.

“Through an unprecedented year of challenges across all businesses, farmland investing stayed resilient and gained greater recognition from institutional investors,” said Kate Westfall, COO of GAI for HighQuest Group, the parent company of Global AgInvesting. “And our global GAI community did not waver in its commitment to advancements and investments in the burgeoning sector during a year of virtual events. We are, however, very excited about coming together again this summer in a unique and safe way.”

The conference agenda will provide insight into agriculture as an impact investment, key in on sustainable strategies in the sector such as opportunities in regenerative agriculture and carbon capture, and highlight the value of investing in the stability of ag, as evidenced by NCREIF, the National Council of Real Estate Investment Fiduciaries (NCREIF) Farmland Index, numbers.

For the first quarter of 2020, NCREIF cited total returns that were down -0.10 percent – the first negative total return for the Index in nearly 20 years. While this might not seem inspiring at first glance, when compared with other indices, it highlights the strength of farmland as an asset class. For example, the Dow Jones Industrial Average finished Q1 having fallen by more than 23 percent, the Russell 3000 Index fell by 20.9 percent for the quarter and the S&P 500 posted a total return for Q1 of -19.60 percent.

“These factors are not unnoticed by institutions who are increasingly focused on stability in their investment portfolios,” said Westfall. “As the food and ag community comes together to find sustainable solutions through ESG initiatives and a commitment to natural capital, we expect to see growing allocations to agriculture as an asset class. GAI will continue to be the source for unrivaled networking and education in the sector, both through our annual conferences and year-round webinars.”

The GAI Community also will gather later this year for Global AgInvesting Asia, 28-29 October in Tokyo, and Global AgInvesting Europe in London, 6-7 December.

Register here for Global AgInvesting in New York, or here for the latest complimentary webinar, or to view any of the nearly 20 previous webinars on topics such as carbon markets, investing in Australian agriculture, COVID-19 and the impact on the agricultural sector, supply chain disruptions and the latest Global AgInvesting Rankings & Trends Report.

Connect with us on LinkedIn, Twitter or Facebook.

# # #

Global AgInvesting, a brand of HighQuest Group, is the world’s most well attended agricultural investment conference series and leading resource for news and insight into the global agricultural sector. www.globalaginvesting.com

The Capital Expenses For Vertical Farms And Greenhouses

28-01-202 | Agritecture

Written By: Djavid Amidi-Abraham

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Breaking down the differences in CapEx between Vertical Farms and Greenhouses. If we peer into the portfolios of some venture capital investors with funds dedicated to agriculture investments, we see a hesitance to invest in vertical farms.

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Here at Agritecture, we have performed side-by-side analyses of vertical farms and greenhouses. For most US markets, the greenhouse model comes out ahead on both capital and operational costs.

Let’s look at an example located in a New York Metropolitan market scenario with two similarly sized facilities having similar amounts of bed space (production capacity). The below tables indicate their differing costs per lb of leafy greens grown in the first year.

This analysis focuses on production systems and has thus excluded costs relating to installation and land acquisition, but includes an additional distribution cost for the greenhouse model, as this greenhouse is likely to be located outside of an urban area but still within the “local” range. In the interest of equating production conditions, the greenhouse model also includes additional capital and operational costs for the integration of supplemental lighting in order to bring the daily light integral to equal quantities provided by most vertical farms.

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While we may see different scenarios in the future, this assessment draws on current prices and equipment performance. 

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Greenhouses draw a lot of their value from the fact that the production surfaces are mostly illuminated by the sun, a free resource. Vertical farms, on the other hand, have to pay for the light that their crops see, a significant added cost that often occupies high percentages of operational costs. 

In addition, a specialized HVAC system must be designed and implemented to neutralize the heat emitted by the lights. Additional dehumidification capacity is also required with design setpoints relative to the transpiration rate of the crops being grown. HVAC is often the second-highest, non-labor expenditure for VF operations and when dehumidification is added into the mix, overall HVAC operational costs can even exceed lighting electricity costs.  

As LEDs become more efficient, less power will be required to cool the space and the economic scenario for VFs becomes more attractive as two of the highest operational costs have been reduced.

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To date, the introduction of LEDs to the agriculture industry has made VFs possible. In the future, the continued improvement of LEDs will make VFs more competitive against other modes of controlled environment crop production. It’s hard to say if VFs will outcompete greenhouses on their costs of production as greenhouses similarly benefit from lighting efficiency improvements that will enable them to serve more northern markets at lower operational costs.

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https://design.agritecture.com/learn/?utm_campaign=capital-expenses-vf&utm_medium=agr-com&utm_source=blog

While greenhouses outcompete vertical farms today, there may be a future where those tables are turned.

It should be considered that the efficacy of either of these approaches to CEA will be informed by local market conditions. In relation to both the revenue generated and the costs of operation, markets around the world provide differing contexts for the production of crops in protected agriculture scenarios, and these varying costs and opportunities create a unique scenario in every market. 

Agritecture’s consultants have a deep understanding of these costs and opportunities and have provided these insights to over 100 clients in more than 20 countries. If any of our readers would like to explore the possibilities in their local region, reach out to Agritecture and we can assess this opportunity through our unique approach and assessment methodology.

This is the second of a two-part series on how vertical farming compares to other farming methods, from our Lead Systems Designer, Djavid Amidi-Abraham. To read Part 1, click here.

Source and Photo Courtesy of Agritecture

AppHarvest, A Pioneering Developer And Operator of Sustainable, Large-Scale Controlled Environment Indoor Farms, Becomes A Public AgTech Company

February 01, 2021

AppHarvest and Novus Capital Complete Business Combination

AppHarvest to Begin Trading on Nasdaq as “APPH” on February 1, 2021

Company Reaffirms Full-Year 2021 Guidance

MOREHEAD, Ky., Feb. 01, 2021 (GLOBE NEWSWIRE) -- AppHarvest (“the Company”), a leading AgTech company and Certified B Corp building and operating some of the country’s largest high-tech indoor farms to sustainably grow affordable, nutritious, chemical pesticide-free non-GMO fruits and vegetables at scale using 90 percent less water than traditional open-field agriculture and 100 percent recycled rainwater, and Novus Capital Corp. (Nasdaq: NOVS) (“Novus Capital”), a publicly-traded special purpose acquisition company, announced today that they have completed their previously announced business combination and related charter amendments.

The resulting company is named AppHarvest, Inc. and its common stock and warrants will commence trading on Nasdaq under the new ticker symbols “APPH” and “APPHW,” respectively, on Monday, February 1, 2021. AppHarvest has qualified to list on the Nasdaq Global Select Market, which is the highest of three tiers based on certain financial, liquidity, and corporate governance requirements that the company met. The combined company will be led by Jonathan Webb, AppHarvest’s Founder & Chief Executive Officer.

The Boards of Directors of AppHarvest and Novus Capital unanimously approved the transaction, and the transaction was also approved at a special meeting of Novus Capital shareholders on January 29, 2021.

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Preparing AppHarvest tomatoes for shipping (Photo provided)

 Company Overview

AppHarvest, committed to ESG principles and social impact, is redefining and transforming American agriculture by developing modern, large-scale and efficient indoor farms in Central Appalachia, a water-rich region strategically located within a day’s drive of approximately 70% of the U.S. population. AppHarvest has strong relationships with the leading agricultural and construction firms and universities in the Netherlands, the world’s leader in high-tech controlled environment indoor farms.

The Netherlands, despite a land mass similar in size to Eastern Kentucky, is the world’s second-largest agricultural exporter behind only the United States due to its extensive network of controlled environment agriculture facilities. These relationships allow the Company to leverage the most recent proven technologies in an effort to sustainably increase crop yields, improve access to nutritious, non-GMO food, build a consistent and safe U.S.-grown food supply for national grocers, and increase investment and employment in Appalachia. The Company operates a 60-acre controlled environment agriculture facility in Morehead, Kentucky — one of the largest high-tech greenhouses in the world — and has an active development pipeline for up to 12 large-scale indoor controlled-environment farm projects through 2025.

AppHarvest has achieved several key commercial milestones since announcing the business combination on September 29, 2020:

• January 19, 2021: Announced first-ever harvest of Beefsteak tomatoes from its 60-acre Morehead, Kentucky, flagship indoor farm, and began shipping to select national grocery retailers. The Morehead facility alone is expected to produce about 45 million pounds of tomatoes annually.

• October 26, 2020: Announced the start of construction on a third high-tech controlled environment agriculture facility in Central Appalachia and expansion into growing leafy greens. Located in Berea, Kentucky, the farm, when complete, will be 15 acres.

• October 20, 2020: Announced the start of construction on a second high-tech controlled environment agriculture facility in Madison County, Kentucky. The farm, when complete, will exceed 60 acres and will double AppHarvest's existing growing space in Central Appalachia.

“Today marks an important milestone for AppHarvest and for American agriculture as we drive the next chapter of our growth as a public company,” said Jonathan Webb, Founder and Chief Executive Officer of AppHarvest, “The capital we raised in this transaction will further advance our mission of transforming agriculture by developing large-scale sustainable food production in the heart of Central Appalachia. We currently import nearly half of all fresh vine crops sold in the U.S. To create a more resilient food system, we must farm more efficiently and closer to where the food is needed.”

David Lee joined AppHarvest as president on Jan. 25, having previously served in the CFO and COO roles at Impossible Foods and bringing decades of experience across retail and consumer industries driving business transformation and optimizing organizational effectiveness from Del Monte to Zynga to Impossible Foods. He will focus on accelerating infrastructure buildout, strengthening marketing and establishing effective product development processes as AppHarvest works to build an iconic brand that disrupts traditional agriculture.

“In a marketplace where consumers are more knowledgeable and conscientious than ever about the food they buy, we have a tremendous opportunity at AppHarvest to build a trustworthy sustainable foods brand that people care about,” said AppHarvest President David Lee. “Customers are craving better quality food options—and ones they can feel better about because the company is socially conscious and environmentally responsible. With our first harvest already underway and produce shipping to major grocery outlets, we reiterate our full-year 2021 guidance.” 

Supported by early sales from its first harvest, AppHarvest reaffirms guidance on full-year 2021 net revenue of $21 million and Adjusted EBITDA of ($41) million provided during its Analyst Day presentation on December 15, 2020. Note, Adjusted EBITDA excludes stock-based compensation and other non-cash items.

“Jonathan Webb and his talented team at AppHarvest have established a unique platform for rapid growth and value creation that will be further strengthened by this transaction and entrance into the public markets,” said Bob Laikin, Chairman of Novus Capital. “We look forward to seeing the team capitalize on the attractive opportunities that lie ahead given the heightened investor focus on ESG initiatives and the secular shift to plant-based foods, as AppHarvest continues to redefine American agriculture.”

Transaction Overview

As a result of this transaction, AppHarvest has received approximately $475 million of gross proceeds, including $375 million from the fully committed common stock PIPE anchored by existing and new investors – including Fidelity Management & Research Company, LLC, Inclusive Capital and Novus Capital. The transaction provides AppHarvest over $435 million of unrestricted cash, which will primarily be used to fund operations, including building additional high-tech controlled environment indoor farms, support growth and for other general corporate purposes.

A more detailed description of the transaction terms will be included in a current report on Form 8-K to be filed by AppHarvest, Inc. with the U.S. Securities and Exchange Commission (“SEC”), as well as Novus Capital’s previous filings with the SEC. Once AppHarvest’s common stock and warrants commence trading on Nasdaq under the new ticker symbols “APPH” and “APPHW,” the Novus Capital units (“NOVSU”) will cease trading on Nasdaq.

Cowen served as sole placement agent and capital markets advisor, and Blank Rome LLP served as legal advisor to Novus Capital. Cowen served as financial advisor and Cooley LLP served as legal advisor to AppHarvest.

About AppHarvest

AppHarvest, a public benefit corporation and Certified B Corp, is an applied technology company building some of the world’s largest indoor farms in Appalachia. The Company combines conventional agricultural techniques with cutting-edge technology and is addressing key issues including improving access for all to nutritious food, farming more sustainably, building a home-grown food supply, and increasing investment in Appalachia. The Company’s 60-acre Morehead, Kentucky facility is among the largest indoor farms in the U.S. For more information, visit https://www.appharvest.com/.

Non-GAAP Financial Measures

The financial information and data contained this press release is unaudited and does not conform to Regulation S-X. Accordingly, such information and data may not be included in, may be adjusted in, or may be presented differently in, any proxy statement/prospectus or registration statement or other report or document to be filed or furnished by the Company with the SEC. Some of the financial information and data contained in this press release, such as EBITDA or Adjusted EBITDA, has not been prepared in accordance with United States generally accepted accounting principles (“GAAP”). The Company believes these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to the Company’s financial condition and results of operations. The Company’s management uses these non-GAAP measures for trend analyses and for budgeting and planning purposes. A reconciliation for the Company’s 2021E non-GAAP financial measures to the most directly comparable GAAP financial measures is not included, because, without unreasonable effort, the Company is unable to predict with reasonable certainty the amount or timing of non-GAAP adjustments that are used to calculate these non-GAAP financial measures.

The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating projected operating results and trends. Other similar companies may present different non-GAAP measures or calculate similar non-GAAP measures differently. Management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses that are required by to be presented in the Company’s GAAP financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses are excluded in determining these non-GAAP financial measures. You should review the Company’s audited financial statements prepared in accordance with GAAP, which will be included in a combined registration statement and proxy statement to be filed with the SEC.

Forward-Looking Statements
Certain statements included in this press release that are not historical facts are forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,” “would,” “plan,” “predict,” “potential,” “seem,” “seek,” “future,” “outlook,” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters. All statements, other than statements of present or historical fact included in this press release, regarding the business combination, AppHarvest’s expected use of proceeds from the business combination and PIPE, the benefits of the transaction and AppHarvest’s future financial performance, as well as AppHarvest’s growth plans and strategy, ability to capitalize on commercial opportunities, future operations, estimated financial position, estimated adjusted EBITDA, revenues and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of AppHarvest’s management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on as, a guarantee, an assurance, a prediction, or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of AppHarvest. These forward-looking statements are subject to a number of risks and uncertainties, including those discussed in the final prospectus/proxy statement filed with the SEC by Novus Capital on January 11, 2021, under the heading “Risk Factors,” and other documents Novus Capital has filed, or that AppHarvest will file, with the SEC. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. In addition, forward-looking statements reflect AppHarvest’s expectations, plans, or forecasts of future events and views as of the date of this press release. AppHarvest anticipates that subsequent events and developments will cause its assessments to change. However, while AppHarvest may elect to update these forward-looking statements at some point in the future, AppHarvest specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing AppHarvest’s assessments of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements.

Investor Contacts

Chris Mandeville and John Mills
AppHarvestIR@icrinc.com

GROW Impact Accelerator Invites Applications From Startups Fostering Food Sustainability

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January 19, 2021

AgFunder

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GROW is based in Singapore, at the heart of Asia Pacific. Image credit: lena_serditova / iStock

GROW, the impact venture builder backed by AgFunder, is now accepting applications for its 2021 Impact Accelerator program. This is a unique opportunity for startups operating in new frontiers of foodtech and agtech to supercharge their growth by tapping into a global network with GROW as their gateway to Asia and the world.

This program marks the GROW Impact Accelerator’s second cohort, backed by AgFunder’s GROW Impact Fund. It will include bespoke coaching, mentor support, expert sessions, peer learning, and access to AgFunder’s unrivaled industry network to help businesses scale aggressively into new markets around the world. Successful applicants will receive US$200,000 in cash and in-kind investment on founder-friendly terms.

Agrifood is the sector where impact investors expect to increase their allocation the most over the next five years, according to the Global Impact Investing Network’s 2020 investor survey. Startups participating in the GROW Impact Accelerator will be given the tools to implement ESG principles and to track how their technology solutions help bring positive impact to people, place, and planet. We deliver a complete program that will provide access to experts, partners, potential customers, and impact-focused investors.

Last year, GROW ran its Singapore Food Bowl program, focused on accelerating early-stage startups that can contribute to local food security. Find out more here

Established to advance sustainability in the agrifood system through its support of extraordinary founders, GROW has designed the GROW Impact Accelerator program to propel not just commercial growth for participating startups, but personal growth for the entrepreneurs behind them. As venture capital investors we are in pursuit of profit, but GROW will also imbue in its alumni an ethos of doing well by doing good; one that will remain with them long after the program has finished.

The GROW Impact Accelerator is based in Singapore but will be conducted as a fully virtual program until international travel resumes. Applicants should have an MVP, be well on the way to establishing product-market fit, and should be operating in at least one market. Our interests stretch end-to-end across the agrifood value chain with a focus on technologies that allow for scalability while delivering on impact creation.

Invest with Impact. Click here.

Areas of particular interest for our 2021 intake include (but are not limited to):

• Biotech and digitalization to advance sustainable agriculture;

• Circular economies (eg, sustainable materials and closed-loop production systems);

• Climate-smart agriculture and aquaculture (technologies for carbon emissions reduction, regenerative agriculture, water use);

• Alternative proteins, innovative foods, and novel ingredients;

• Food waste valorization;

• Supply chain rationalization;

• Technologies to support smallholder farmers (eg, robotics, decision support, chemical reduction, financial inclusion).

To encourage as diverse and representative a cohort as possible, GROW is especially interested in receiving applications from teams with at least one female founder.

You can find more detailed information and apply here.

Applications close on 28 February at 23:59 GMT+8.

CubicFarms Announces Change of Financial Year End And Change of Auditor

VANCOUVER, B.C., January 19, 2021 – CubicFarm® Systems Corp. (TSXV:CUB) ("CubicFarms" or the "Company"), a local chain, agricultural technology company, today announced that it has changed its financial year-end from June 30 to December 31. The change in financial year-end has been made to coincide with the financial year-ends for the parent corporation and all its subsidiaries.

For details regarding the length and ending dates of the financial periods, including the comparative periods of the interim and annual financial statements to be filed for the Company's transition year and its new financial year, reference is made to the Notice of Change in Year-End filed by the Company on SEDAR pursuant to Section 4.8 of National Instrument 51-102, a copy of which is available electronically at www.sedar.com

In addition, the Company has changed its auditor from MNP LLP (the "Former Auditor") to KPMG LLP (the "Successor Auditor"). At the request of the Company, the Former Auditor resigned as the auditor of the Company effective January 7, 2021, and the Company appointed the Successor Auditor as the Company's auditor effective January 7, 2021, until the next Annual General Meeting of the Company.

"We would like to thank MNP for their expertise and guidance and we are pleased to announce that KPMG will be our auditor going forward," said Dave Dinesen, CubicFarms' CEO.

There were no reservations in the Former Auditor's audit reports for the period commencing at the beginning of CubicFarms' two most recent financial years and ending at the date of the resignation of the Former Auditor. There are no "reportable events" (as the term is defined in National Instrument 51-102 – Continuous Disclosure Obligations) between the Company and the Former Auditor.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

About CubicFarms

CubicFarms is a local chain, agricultural technology company developing and deploying technology to feed a changing world. Its proprietary technologies enable growers around the world to produce high quality, predictable crop yields. CubicFarms has two distinct technologies that address two distinct markets. The first technology is its CubicFarms™ system, which contains patented technology for growing leafy greens and other crops indoors, all year round. Using its unique, undulating-path growing system, the Company addresses the main challenges within the indoor farming industry by significantly reducing the need for physical labour and energy, and maximizing yield per cubic foot. CubicFarms leverages its patented technology by operating its own R&D facility in Pitt Meadows, British Columbia, selling the system to growers, licensing its technology, and providing vertical farming expertise to its customers.

The second technology is CubicFarms' HydroGreen system for growing nutritious livestock feed. This system utilizes a unique process to sprout grains, such as barley and wheat, in a controlled environment with minimal use of land, labour, and water. The HydroGreen system is fully automated and performs all growing functions including seeding, watering, lighting, harvesting, and re-seeding – all with the push of a button – to deliver nutritious livestock feed without the typical investment in fertilizer, chemicals, fuel, field equipment, and transportation. The HydroGreen system not only provides superior nutritious feed to benefit the animal but also enables significant environmental benefits to the farm.

For more information, please visit www.cubicfarms.com

Hydrobuilder Holdings Raises $70 Million And Combines West Coast Hydroponics Chain With Online Retailer

January 15, 2021

Published by NCV Newswire

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Hydrobuilder Holdings Acquires Hydrobuilder.com and GreenCoast Hydroponics to Form a Leading Omni-channel Seller of Specialty Agriculture and Hydroponics Equipment and Supplies

Secures over $70 million in financing from broad base of investors

PALM BEACH, Fla.-January 15, 2021-(BUSINESS WIRE)–Hydrobuilder Holdings LLC (“Hydrobuilder Holdings”) today announced its formation through the acquisitions of Hydrobuilder.com, a leading online retailer of hydroponics and horticultural supplies, and GreenCoast Hydroponics, the second largest hydroponics retailer in the United States, to create a leading omni-channel retailer of specialty agriculture and hydroponics equipment and supplies. Hydrobuilder Holdings secured over $70 million in financing from a broad group of investors, led by Broadband Capital Investments. As part of the transaction, the sellers of both Hydrobuilder.com and GreenCoast Hydroponics retained a meaningful equity stake in Hydrobuilder Holdings.

Hydrobuilder Holdings will be led by Markus Hockenson, Chief Executive Officer, and Avi Levine, Chief Financial Officer, both of whom bring extensive digital and retail experience, and a proven track record of driving revenue, earnings growth and value creation at private-equity owned companies. Hydrobuilder.com and GreenCoast will continue to be operated by their existing management teams under the newly-formed Hydrobuilder Holdings platform and substantially all team members from Hydrobuilder.com and GreenCoast will remain with Hydrobuilder Holdings.

Mr. Hockenson previously served as President and Chief Executive Officer of International Car Wash Group and Vision Group Holdings, and has served in leadership positions at Enterprise Rent-a-Car, Starbucks, Advance Auto Parts, and TBC Corporation (Tire Kingdom). Mr. Levine previously served as Chief Financial Officer of International Car Wash Group, and has additional experience at Deloitte Consulting, Versa Capital Management, Flashpoint College and Driven Brands.

“We are excited to bring together two proven leaders in hydroponics e-commerce and brick-and-mortar retail as the initial partnerships within Hydrobuilder Holdings, which we believe is poised to be a leading omni-channel seller of specialty agriculture and hydroponics equipment and supplies,” said Hockenson.

Hydrobuilder Holdings is uniquely positioned to provide commercial growers and home gardeners with the highest level of service, product selection, education and value.

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Markus Hockenson, Chief Executive Officer

With strong investor support and significant follow-on interest from our investors, we have substantial growth capital to execute our organic and M&A growth strategies, and see significant opportunities to expand these businesses in the rapidly growing hydroponics, specialty gardening and controlled environment agriculture (CEA) markets.

Hydrobuilder.com Founder and President, Justin Marshall, commented, “Partnering with GreenCoast and joining Hydrobuilder Holdings is a dream come true. I am incredibly grateful and excited to be working alongside these experts and pioneers within the hydroponics industry as well as professionals from many outside business ventures. The combined knowledge and experience will allow us to take the Hydrobuilder.com platform and apply it to some of the most successful brick-and-mortar stores in our space by utilizing our custom IT infrastructure, which enhances automation while also providing an omnichannel approach to sales for our customers. With this combination, we’ll be able to scale and automate at a far greater speed than what was possible on our own. The amount of industry and historical knowledge will allow us to further position ourselves as a leading online retailer of hydroponics equipment and supplies.”

Jordan Weiss, Chief Executive Officer of GreenCoast Hydroponics, said, “We couldn’t be more excited to see our business develop and grow into an omni-channel national model. This will better integrate and support our customers’ needs across all of our three pillars: e-commerce, retail and commercial. Along with better serving our customers, we feel great about how this partnership will support our employees and the culture that we have worked 20+ years to build.”

Michael Rapp, Managing Partner of Broadband Capital Investments, added, “We are excited to be investing in the formation of Hydrobuilder Holdings. Justin, Jordan, and their respective teams have built best-in-class companies and have deep domain knowledge. Markus and Avi are world-class executives who understand how to drive efficiencies and scale enterprises, both organically and through acquisitions. We are serving a nascent but fast-growing end market and our customers are in need of a local supply chain partner who can offer a suite of products and services to solve problems and add value. We are excited by this opportunity and we look forward to building a leading company in this space.”

About Hydrobuilder.com

Founded in 2011, Hydrobuilder.com is based in Northern California and has rapidly grown to become a leading online retailer of hydroponics and horticultural supplies. The management team previously helped Build.com grow to over $1 billion in sales, and has built Hydrobuilder.com into a complete online hydroponic gardening center that is known for having the top product lines, a fast, user-friendly website and knowledgeable employees.

About GreenCoast Hydroponics

Founded in 1999, GreenCoast is a Southern California-based specialty agriculture/hydroponics products retailer and the largest independent retailer of its kind in the United States. GreenCoast operates 12 stores (10 in California, 1 in Las Vegas, and 1 in Portland, OR), that provide equipment, plant consumable products, and design services to growers ranging from the hobbyist to the largest licensed commercial operators. Senior management is known throughout the industry as experts in design of large-scale industrial growing facilities.

About Broadband Capital Investments

Broadband Capital Investment (BCI) is a boutique merchant bank that invests in high growth industries. BCI (and/or its affiliates) was the founding investor in Vroom.com (Nasdaq: VRM), a leading used car e-commerce company, co-led the management buyout of Hydrofarm Holdings (Nasdaq: HYFM), a leading hydroponics manufacturer and distributor, prior to its initial public offering, and invested in Montrose Environmental (NYSE: MEG), an environmental services provider offering measurement & analytical services as well as environmental resiliency & sustainability solutions.

Original Press Release

Published by NCV Newswire

BROADBAND CAPITAL, GREENCOAST, HYDROBUILDER, HYDROPONICS

Indoor Farming Services Provider Agrify Sets Terms For $25 Million IPO

Renaissance Capital Renaissance Capital

January 13, 2021

Agrify, which provides turnkey indoor farming solutions, announced terms for its IPO on Wednesday.

The Burlington, MA-based company plans to raise $25 million by offering 2.8 million shares at a price range of $8 to $10. At the midpoint of the proposed range, Agrify would command a fully diluted market value of $115 million.

The company claims to differentiate itself with a bundled solution of equipment, software, and services that is turnkey, end-to-end, fully integrated, and optimized for precision growing. Revenue mainly comes from core hardware products, the Agrify Vertical Farming Unit, as well as facility build-outs. Agrify provides products to a variety of agricultural segments, citing cannabis as a key market opportunity.

Agrify was founded in 2016 and booked $9 million in revenue for the 12 months ended September 30, 2020. It plans to list on the Nasdaq under the symbol AGFY. Maxim Group LLC and Roth Capital are the joint bookrunners on the deal.

The article Indoor farming services provider Agrify sets terms for $25 million IPO originally appeared on IPO investment manager Renaissance Capital's web site renaissancecapital.com.

Investment Disclosure: The information and opinions expressed herein were prepared by Renaissance Capital's research analysts and do not constitute an offer to buy or sell any security. Renaissance Capital's Renaissance IPO ETF (symbol: IPO), Renaissance International ETF (symbol: IPOS), or separately managed institutional accounts may have investments in securities of companies mentioned.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Sustainable Food Leads £6m Research Project To Transform The UK food System

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By India Education Diary Bureau Admin

January 10, 2021

A new £6m research project titled Healthy soil, healthy food, healthy people (H3) seeks to transform the UK food system from the ground up via an integrated programme of interdisciplinary research.

Social and natural scientists from the Institute for Sustainable Food at the University of Sheffield will collaborate on a whole-system approach to emphasise the links between production and consumption and identify practical paths towards food system transformation.

Food security and sustainability are among the greatest challenges facing the world today, and traditional approaches of intensifying food production are coming under criticism for not looking at the whole picture of how we produce, and supply food to the nation.

The Covid-19 pandemic also shone a light on the fragility of the UK’s food systems resilience and how its reliance on foreign imports during a global crisis meant people in the UK experienced empty shelves, and shortages of basic staples such as flour and pasta.

The H3 consortium – which draws on the combined strength of researchers from the University of Sheffield, University of Leeds, University of Bristol, University of Cambridge and City, University of London as well as a wide range of stakeholders from government, business and civil society – will focus its research on horticulture, hydroponics and hybrid farms, and on the health benefits of biofortification and increased fibre consumption.

This is an exciting, once-in-a-lifetime, opportunity to use cutting-edge research to have a genuinely transformative effect on the health and sustainability of the UK food system.

“We are delighted that the Institute for Sustainable Food will be leading one of the four consortia to be funded by the UK Research and Innovation’s Transforming the UK Food System for Healthy People and a Healthy Environment programme.

Professor Peter Jackson

Co-director of the Institute for Sustainable Food at the University of Sheffield

The project will identify practical paths towards food system interventions: on farm, in food manufacturing and retail, and improve dietary health and environmental sustainability of the agri-food industry in the UK.

This will include finding ways to increase the production of health-promoting vegetables while reducing reliance on harmful agricultural inputs and imported food by integrating hydroponic production systems within conventional soil-based farms. The project will also look at how improving the microbiomes of growing mediums has the potential to increase nutrients in our food systems and reduce our reliance on pesticides.

We are absolutely delighted by this award and excited to apply the food systems-level thinking we’ve developed at the Institute for Sustainable Food to the real world.

“Backed up by our world-leading research, this work has huge transformational potential to improve the sustainability, the quality, and the equity of our agri-food system here in the UK. Working closely with our external partners will add a real world perspective to shape how our initiatives are applied.

“In terms of fighting the climate crisis, this kind of transformational research is sorely needed. We are delighted that the Institute for Sustainable Food will be leading the way in developing and applying that research.”

2020’s Indoor Farm Venture Capital Bonanza

In the face of a dismal year, indoor agriculture saw record fundraising from venture capital and other private investors in 2020. "The industry raised US$565mm in 2020. This figure excludes several notable rounds where the amounts raised were not publicly disclosed," says Nicola Kerslake, CEO of Contain. 

"New Jersey-based vertical farmer AeroFarms was one of four recipients of funding from the Abu Dhabi Investment Office for its Dubai farm. Late in the year, automated vertical farmer 80 Acres raised a round from British bank Barclays. Elsewhere, at-home kit provider Back to the Roots added a prominent Saudi sustainable ag supporter to its existing investor list for an October 2020 round. Even without these rounds, 2020’s total was up nearly 50% on 2019 and represents a record for the industry, besting 2017’s US$391mm," states Nicola.   

Credits: Contain

According to Nicola, vertical and greenhouse farms again represented the bulk of funding, thanks to large rounds from majors such as Bright Farms (US$100mm), Gotham Greens (US$87mm), InFarm (US$170mm), and Plenty Ag (US$140mm). Outside of this, a notable trend was that industry suppliers are now beginning to interest investors. For instance, greenhouse computer vision tech provider iUNU raised a $7mm round led by frequent agriculture investors S2G Ventures and Ceres Partners. Contain Inc, the fintech platform that I lead, has itself been a part of this trend, raising a funding round from the US and European investors at the tail end of 2020.

"This resurgence can be traced to several factors. Most important is the lure of all manner of sustainable agriculture in a world where everyone seemed to become food-obsessed during lockdowns.  Increasing industry participation from large produce buyers has also played a part, as they’re seen as an indication of the industry’s viability by venture capital investors," Nicola adds.  

In addition, venture capital funds are typically thematic investors, and COVID rendered several of these themes obsolete and encouraged venture capitalists to pivot to new ones. "For example, some parts of the ultra-hot sharing economy theme that spawned companies like Uber suddenly look less alluring when consumers are loath to share space. Meanwhile, themes around health and wellness became far more attractive, benefiting adjacent industries such as indoor agriculture," Nicola affirms. 

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Credits: Contain

"Going forward, venture capital funds still have plenty of dry powder for investment, after a healthy fundraising environment for them in 2020", says Nicola. Industry researcher PitchBook says that funds raised by venture capital firms rose by nearly a quarter over 2019 levels.[1] The year’s strong IPO (stock market listing) market helped, with tech favourites like AirBNB and DoorDash going public. Indoor agriculture remains a minority sport for investors, 2020’s record haul represents less than that raised in the year by stock trading app Robinhood alone. Nicola adds: "Given this, it’s perfectly possible that we may see another record-breaking year for indoor agriculture in 2021."

For more information:
Contain
nicola@contain.ag
www.contain.ag

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5 Jan 2021
Author: ebekka Boekhout
© VRerticalFarmDaily.com

Tips To Reduce Vertical Farm Costs

There are a number of key variables to consider when setting up your own vertical farm that calls for considerable financial clout. Light Science Technologies offers a bespoke solution that helps growers to achieve maximum yield while saving costs and energy. 

The rising AgriTech start-up offers the first of two features offering tips to help you to reap optimum results and high returns.

Tip 1: Location, location, location
While you don’t need as much land as traditional growing, finding the right location for your vertical farm is crucial. The wrong location can prove a costly mistake, so do your homework before committing. Do you have the right local infrastructure in place to get your product to your buyer as efficiently as possible? Can you source enough electricity? How much does water cost in this county compared to the next one over? 

Tip 2: Minimize energy costs
However, energy-efficient your operation is, you’re still going to use a huge amount of electricity every year. The most cost-effective solution might be to create your own renewable energy. That isn’t possible for all sites, but even micro-generation could help to bring your OPEX down. 

Tip 3: Engage the experts
Let’s be frank: vertical farming is no small subject. Start building relationships as early as possible with people who know everything on it, from lighting and data to botany. 

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Tip 4: Balance OpEx and CapEx costs
Think big picture in terms of cost. Spending more initially could reap rewards later on. For instance, heavier investment in technology in order to automate seeding, feeding, watering and harvesting will require a greater initial outlay, but a far smaller workforce; labour costs can easily account for over 50% of a vertical farm’s OpEx. 

According to CambridgeHOK, a small vertical farm with minimal automation costs around £1,000 per square metre to set up. A large farm with full automation will cost in the region of £3,000 per square metre. You’ll also need to factor in OPEX differences to the growing system you choose (hydroponic, aeroponic, and/or aquaponic).

Tip 5: Don’t cut corners
Buy wisely. Avoid gambling on cheaper products, such as mass-produced imported lighting. Ensure major costs come with decent guarantees and support in place should anything go wrong. 

Cutting corners now could cause repercussions later down the line, and not just in maintenance and replacement costs. Cheaper options could spell inflexibility, killing your vertical farm’s true potential.

6. Choose your crops carefully
There are pros and cons to different types of crops. Quick-growing plants tend to be cheaper to grow, resulting in an abundance of product. However, some slower-growing crops, such as medicinal cannabis, can earn you far more per plant. Some crops require less energy. Others take up less space so you can pack more in. Fastidious research and number crunching will help you to choose the best option for your own vertical farm.  

Tip 7: Know your audience
Assuming there’s a market for what you’re growing is where you could fall short. Many vertical farmers focus on fast-growing salad crops. In an optimized environment, you could end up producing 30 tonnes of salad a day. But can you guarantee sales of lettuce through the depths of winter? Potentially, this could either mean considerable wastage or letting part of your vertical farm sit idle for weeks on end, which will mean diminishing returns. 

Sound planning and organization from the start is essential and will enable you to factor in a different crop switch every few months with flexible lighting systems if required. 

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For more information:
Light Science Tech 
Claire Brown, PR Consultant
claire.brown@lightsciencetech.com
www.lightsciencetech.com 

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Publication date: Fri 8 Jan 2021

“There Is Abundant Liquidity But A Lack of Solid Business Cases”

“I come across many vertical farming concepts. There are some very interesting developments going on in the market. Especially for investors, because vertical farming is future-focused,” says Jobbe Jorna, Founder and Managing Partner at Upstream Capital. The Amsterdam-based organization advisory boutique is specialized in helping companies realize their full potential with performance improvement and corporate finance.  

“Multiple investors are looking into (inter)national vertical farming projects. There’s abundant liquidity but a lack of solid business cases.” According to Jobbe, as a result of the pandemic investors are becoming increasingly critical, also in the Netherlands. They take more time for a thorough analysis, walking through the entire process teaming up closely with stakeholders. In the end, this is only beneficial for farmers because it contributes to the design, build, finance, maintain, and operate a solid foundation to build a successful farm upon. 

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Jobbe Jorna

Sharp review of business cases
Jobbe says that there are three common mistakes that he comes across frequently when reviewing business cases. Firstly, farmers need to develop a strategic competitive advantage with sufficient upside potential. The business case has to be scalable. Secondly, the value proposition has to be validated, tested, and ready-to-market. “Don’t put too much R&D into it, Bear in mind, an idea does not immediately make a working concept. Let alone a winning go-to-market proposition that can be achieved,” Jobbe adds.

“Investors want to see a rock-solid value proposition with upside potential and a powerful management team with strategic business partners, backing up the company. Most investors don’t go onboard if there isn’t a worthy team with a strong and proven track record.” Finally, farmers should look outside the box as in horizontal integration within the value chain, long-term off-take contracts. In the past, we successfully realized sustainable energy projects in greenhouses driven by long-term contracts at a middle price. In this way, we can secure the business case against crop price fluctuations. As a result, the business case attracts more interest from potential financiers, in the wide range of business angels and investors to banks.”

Key takeaways
Cultivation is your core, says Jobbe, then start with the end in mind. Who is the end customer, what are the current needs, and what are tomorrow’s needs? Rethink the value chain and develop your own eco-system of strategic partners. Farmers need to their homework. Start in time, as it’s more challenging than people think. You need to have a rock-solid business plan in place prior to approach potential investors.

Jobbe says that when a business plan is solid enough, farmers should put together a game plan before going out and start to approach potential investors. “If that’s done too early, your process, time and wallet for that matter will take a sufficient hit. When growers are in a negotiation phase with investors, they should follow a structured approach. Keep your options open, your eye on the ball as the negotiation window is a moving target and always respect your walk-away point. Especially now, during the pandemic, growers should not be seduced by an unfair proposal.” 

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For more information:
Upstream Capital
Jobbe Jorna, Founder and managing partner 
+316 1518 4909
jobbe.jorna@upstreamcapital.nl 
www.upstreamcapital.nl 

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Publication date: Thu 7 Jan 2021
Author: Rebekka Boekhout
© VerticalFarmDaily.com

Agri-Tech Startup Granted £566,000 To Develop Growth Chambers

Innovate UK, the UK’s innovation agency has just awarded Grobotic Systems and their consortium partners a grant worth £566,000 to fund the development of their cutting-edge growth chamber and to support the UK Government’s Industrial Strategy to transform food production. 

Agri-tech startup Grobotic Systems believes the best way to deliver this promise is with their latest invention, a new class of plant growth chamber loaded with high-tech sensors and plugged into the internet. This state-of-the-art growth chamber will help vertical farmers identify the best way to grow plants to produce the most nutritious and environmentally-friendly food possible. 

Managing director, Dr. Moschopoulos says “Through collaborating with industry leaders in photonics, controlled environment agriculture, and plant physiology, this funding enables Grobotic Systems to recruit additional staff, accelerate product development, and access the rapidly growing global vertical farming market with our innovative growth chamber technologies.” 

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“Driven by the need to reduce the environmental impact of agriculture, and to improve the nutritional quality and availability of fresh produce, the vertical farming market is a very exciting place to be for an agri-tech startup-like Grobotic Systems. Our novel technologies will help farmers grow healthier food more efficiently - that is better for the environment, better for the farmer, and better for the consumer.”

This project builds on the patent-pending growth chamber technology developed by Grobotic Systems over the past year. Grobotic Systems will lead this project in collaboration with partners from the Fraunhofer Centre for Applied Photonics, Stockbridge Technology Centre, and the University of Sheffield. 

Founded in 2018 by Dr Alexis Moschopoulos, a plant geneticist, and Richard Banks, an electronics engineer, Grobotic Systems is a Yorkshire-based startup engaged in the design and manufacture of innovative plant growth chambers for plant science research.

For more information:
Grobotic Systems
Alexis Moschopoulos, managing director
alexis@groboticsystems.com
www.groboticsystems.com 

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Publication date: Fri 8 Jan 2021

Indoor Ag Fintech Startup Contain Raises Investment Round, Adds Industry Veteran To Team

NEWS PROVIDED BY Newbean Capital

January 04, 2021

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Image from Contain Inc

A Techstars graduate, Contain Inc works with industry vendors and more than 20 lenders to facilitate access to capital for North American indoor growers.

We have plans to introduce new ways to support the burgeoning indoor agriculture industry in 2021, and this funding round will allow us to do just that.”— Nicola Kerslake, Founder, Contain Inc

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Image from Rooted Global

RENO, NV, UNITED STATES, January 4, 2021 /EINPresswire.com/ -- Contain Inc, a fintech platform dedicated to indoor agriculture, today announced that it has closed a round of funding from investors in the US and Europe. They represent investments from indoor agriculture, food and beverage, entertainment, and financial industries. The funds will enable further technology development as well as new initiatives that support indoor agriculture. The industry has become ever more relevant in the time of COVID as consumers and produce buyers alike recognize the benefits of local secure produce supply.

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Image from Contain Inc

A Techstars graduate, Contain Inc works with industry vendors and a pool of more than 20 lenders to facilitate access to capital for North American indoor growers of all sizes. In 2020, Contain collaborated with Singapore family office ID Capital to introduce a microlearning platform, Rooted Global, that enables corporate employees to grow a little of their own food at home. Its clients include tech and food majors, such as Danone and Dole. Nicola Kerslake, founder of Contain Inc, added: “We have plans to introduce new ways to support the burgeoning indoor agriculture industry in 2021, and this funding round will allow us to do just that.”

In addition, Chris Alonzo, President, and CEO of Pietro Mushrooms, will join Contain Inc to provide consulting services to future leasing clients. Chris brings a wealth of experience in planning, constructing and managing indoor farms across two continents. He is a third-generation mushroom farmer in Kennett Township, PA, an area that supplies half of the US’s mushroom supply. Nicola Kerslake said: “we’re frequently approached by indoor farmers planning large new projects and are delighted to be able to offer the services of such an experienced grower to those looking to bolster their plans before seeking financing.” Chris Alonzo added: “I’m excited to bring my expertise to Contain Inc’s fast-growing team and to engage with a startup that has long supported indoor farmers”.

The Company will also be expanding its team in business development, marketing and product development over the coming weeks, and encourages those seeking roles in this exciting space to visit its website at contain.ag for more details.

About Contain, Inc.
Contain Inc is a US-based fintech platform dedicated to indoor agriculture, growing crops in warehouses, greenhouses, and container farms. The Company works with leading equipment vendors and with an expanding pool of lenders to aid indoor growers in finding funding for their farms. It is also home to microlearning platform Rooted Global, which works with majors such as Danone and Dole to enable employees to grow a little of their own food at home. The Company graduated from the 2019 Techstars Farm to Fork program, backed by Cargill and Ecolab.
More information: https://contain.ag, https://rooted.global

Nicola Kerslake
Contain Inc.
+1 7756237116
email us here
Visit us on social media:
Twitter
LinkedIn

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Who Will Win In Indoor Agriculture?

According to Allison Kopf, CEO of Artemis, there are five ways big players will enter indoor agriculture. "The indoor agriculture (both greenhouse and vertical farming) market is one of the fastest-growing industries. Big companies in agriculture and technology are trying to figure out ways to capitalize on the rapid growth of the industry."

"Artemis, the leading software infrastructure company in the industry, which allows us to have a front-row view of how the industry is growing and what the industry needs," says Allison. "Our market has historically been fragmented, where legacy companies have been growing for decades and new players have emerged more recently with innovative models to stake their ground as market leaders. Most of the growers are trying to displace traditional field-grown commodities and increase domestic (i.e. in their local country) production of fresh produce; and we’re seeing this shift, as well."

Allison says that in the 1990s in the United States, the number of tomatoes consumed grown in greenhouses was negligible. Now, only 20 years later, close to 40% are grown indoors. This shift isn’t just happening with tomatoes, it’s happening with crops best suited for indoor growth, such as lettuce, herbs, cucumbers, peppers, and increasingly berries.

"In this industry, unlike more traditional commodity markets, we have no dominant suppliers (inputs, chemicals, finance, technology) yet. Bigger companies have largely left the market open for smaller specialized companies and startups. But this is about to change. The indoor market has shown it’s a lasting and major component of our agricultural supply chain and someone will enter this market with a goal of winning. So, who will it be?"

"I believe the winner will own one or more of the areas below," says Allison. 

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Data
Companies who understand grower workflow, farm financials, operational data, and biological data will have a distinct advantage in the battle for the market. This creates an opportunity for folks like lighting, breeding, climate control, greenhouse manufacturers, lenders, and others.

According to Allison this isn’t just about getting closer to the farmer, it’s also an opportunity to develop technologies faster and to have commercial R&D capacity at your fingertips. "Lighting, for example, is one of the most impactful components for growing indoors. Yet, lighting companies have no access to yield information or quality information from the growers."

With access to on-farm information, lighting can become proactive and intelligent, rather than the PLC technology of the past. Signify and Osram are already leaders in horticultural lighting and are likely in a strong position to start offering intelligent lighting solutions. "Watch out for breeding companies here too. Unfold recently launched with $30m in funding from Bayer to breed indoor crops. I would expect others like Syngenta and Rijk Zwaan to follow with similar initiatives," Allison affirms. 

Finance
There is an estimated $20 billion gap in project finance over the next 3-5 years for greenhouse and vertical farm construction in the United States alone. Agricultural companies who have lending capabilities, like ADM, Bunge, Cargill, Dreyfus, and others will find indoor agriculture opportunities less risky from a growing standpoint than traditional commodity investments. Lenders will need to get comfortable with the relationship-heavy buying market and the lack of offtake contracts in produce but should be able to underwrite with growers who sell to known retailers, like Costco, Walmart, and Target.

"Many growers also have a need for an operating line of credit, often needing to buy in bulk for consumables like seeds, growing media, and chemicals to obtain better pricing. With some buyers, growers face long receivables periods, which also hurt operating cash flow," says Allison.

Ultimately, legacy agriculture companies who lend to agricultural producers will win by creating financial products for the indoor agricultural space and by partnering with the technology producers who can help de-risk the investment. This opportunity will open up billions of dollars in new revenue for someone on a relatively short timeframe.

Traceability
Product recalls and supply chain blind spots hurt everyone in the ecosystem. Bigger agricultural companies have started adding traceability to their strategic plans. Many are testing out blockchain-based technologies. Allison says that others are focused on digital workflow platforms. For the most part, companies haven’t yet figured out how to stretch all the way back to the farmer and this is where the most opportunity lies with indoor agriculture, in particular. 

Because indoor agriculture is more predictable, companies who can track product from input to crop to finished good and all the way through the supply chain will have a critical advantage over others. Retailers like Walmart and Target are making this a priority and have the potential to disrupt their supply chains dramatically with indoor agriculture.

"Let’s say Walmart partnered with indoor producers for 100% of their salad greens, tomatoes, cucumbers, peppers and berries. While implementing this, they set traceability standards for producers and required compliance with those standards. This would not just ensure safe products that are normally high-risk for consumers, it would also enable stable year-round supply of products (with accurate forecasting) for Walmart and would lay the groundwork to move the needle dramatically on sustainability. This means less food waste, more efficient production, stable year-round products, safer, and more sustainable production," says Allison. 

It’s not just retailers who can set the bar when it comes to traceability. Large technology companies like Schneider Electric who have their technology in the hands of all the components of the supply chain, from grower to retailer, are also in a unique position to offer end-to-end traceability products.

Consumables
Consumables are another exciting opportunity for more traditional players entering the indoor agriculture market. Today, growers buy products from many individual suppliers. This drives the price up and makes reliability difficult. If one supplier is out of a product, growers are forced to buy new untested products or find another supplier on short notice.

Large greenhouse growers are often importing products from other countries and buying in bulk just to try to reduce price. And there’s a severe lack of transparency for both pricing and performance. Because the industry is moving so quickly, growers are left to buy based more on marketing claims than on actual performance.

Allison adds: "Indoor growers spend a lot of money on inputs each year and are willing to do so because quality has a direct impact on pricing. This is a drastically different approach from traditional commodity markets where yield is the prime, if not only, driver for financial performance. Because of this, growers tend to pay a premium for inputs to impact not just yield but quality as well."

Farmer’s Business Network has created a marketplace to solve for exactly this type of challenge in the inputs space. This market is ripe for an offering like this. Large chemical companies like OCP and ICL should also be paying attention to this market as specialty products will likely emerge as one of the largest product categories over the next few years.

Digital workflow
Companies like Trimble, John Deere, Syngenta, and Corteva have started making inroads in digital workflow products. None of the products designed for workflow in the field cover the workflow of indoor agricultures.

"In indoor agriculture, you need to couple the traditional cultivation processes and biology of growing with a manufacturing mindset. In indoor agriculture, the growth times are dramatically shorter than in field, so the challenges are more aligned with a factory. You’re thinking about how to manage space, time, and throughput on a continuous basis. It’s just-in-time inventory management," Allison states. 

Understanding this workflow is critical to all of the other items listed above. This is what drives proper data collection, ensures traceability, and enables models like financing or a consumables marketplace. Companies who have a deep understanding of inventory management, like NetSuite, Sage, SAP, and Microsoft might do well capitalizing on this new industry. Other agricultural companies who also work in the construction and manufacturing space, like Trimble, might also win here.

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For more information:
Artemis 
Nathalia Delima
ndelima@artemisag.com 
www.artemisag.com 

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Publication date: Mon 4 Jan 2021
Author: Rebekka Boekhout
© VerticalFarmDaily.com

"Leading The Next Frontier of Farming And This Investment Further Accelerates Our Momentum"

“The addition of our new farm to the network is a critical next chapter in our growth,” said Irving Fain, founder, and CEO of Bowery Farming. “It will expand our reach and ability to be a reliable source of local produce for more communities. We’re leading the next frontier of farming, and this investment further accelerates our momentum.” 

Bowery Farming is building its newest commercial farm in Bethlehem, Pennsylvania. Joining its network of farms in Kearny, New Jersey, and Nottingham, Maryland, Bowery’s new Bethlehem farm will be its largest, most technologically-advanced commercial farm yet. 

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Driven by explosive demand for safer, traceable pesticide-free produce, and propelled by the BoweryOS- which integrates software, hardware, sensors, computer vision systems, machine learning models and robotics to orchestrate and automate the entirety of operations - the strategic location of Bowery’s Bethlehem commercial farm will expand the company’s reach in the region. 

This farm will feature a number of developments that build on previous Bowery technology, further automating the growing process from seed to store, and enhancing the efficiency of Bowery’s network such as, Water Conservation: A state-of-the-art, comprehensive water transpiration system will recapture almost all water used throughout Bowery’s growing process, with the goal of reclaiming and repurposing nearly all of the water in the farm.

The facility will also focus on more efficient LED Lighting amplifying Bowery’s holistic approach to sustainability and features industry-leading environmental improvements like energy-reducing LED lighting throughout.

"It's the smartest farm yet, powered by the BoweryOS, this farm will leverage billions of data points collected from Bowery’s network of farms to grow a reliable supply of consistently delicious produce year-round. Laying the groundwork for the next chapter in smart, scalable indoor farming, the Bethlehem farm will feature next-level technological capabilities unlike any Bowery farm to date, deepening the integration of the BoweryOS across all aspects of the business."

Furthermore, it offers restoration to the community. Bowery is working with the Commonwealth of Pennsylvania to transform the Bethlehem location from a non-arable industrial site into productive, modern farmland—stimulating economic revitalization that will provide year-round sustainable farming jobs for the community. 

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Since the beginning of 2020, Bowery has experienced more than 600% brick and mortar sales growth, and more than doubled sales with e-commerce partners, including Amazon. Bowery’s produce is harvested year-round at peak freshness and delivered to stores within a few days of harvest — a stark contrast to the 90% of leafy greens grown in the U.S., which are transported over 3,000 miles to consumers on the East Coast.

With this new farm, Bowery’s Protected Produce will be available to the 49 million people living within the farm’s 200-mile radius, advancing the company’s goal of expanding access to local, traceable, pesticide-free food to people in every major city in the U.S. and around the world. 

For more information:
Bowery Farming
Shelby Farahan, Communications
sfarahan@boweryfarming.com 
www.boweryfarming.com 

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Publication date: Fri 18 Dec 2020
Author: Rebekka Boekhout
© VerticalFarmDaily.com

Agrify Seeks $25 Million IPO For Indoor Agriculture Growth Plan

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Written by: Donovan Jones Marketplace

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Author of IPO Edge.

• IPO Analysis

Dec. 28, 2020

Agrify Corporation (AGFY)

Summary

• Agrify has filed to raise $25 million in an IPO.

• The firm sells proprietary products and software to the indoor vertical farming market.

• AGFY has grown quickly from a very small revenue base and the industry has promising growth prospects.

Quick Take

Agrify (AGFY) has filed to raise $25 million in an IPO of its common stock, according to an S-1 registration statement.

The firm develops products and related services for the indoor agriculture market.

AGFY is a still tiny firm growing topline revenue quickly while operating in a promising industry.

I’ll provide an update when we learn more about the IPO from management.

Company & Technology

Burlington, Massachusetts-based Agrify was founded to provide proprietary hardware and software to enhance the efficiency of indoor agriculture operations.

Management is headed by CEO Raymond Change, who has been with the firm since 2019 and was previously the founder of GigaMedia (GIGM).

Below is a brief overview video of a vertical farming operation:

To read the full article, please click here.

Note: This report is intended for educational purposes only and is not financial, legal or investment advice. The information referenced or contained herein may change, be in error, become outdated and irrelevant, or removed at any time without notice. You should perform your own research before making any decisions. IPO investing carries significant volatility and risk of loss.

Editor's Note: This article covers one or more microcap stocks. Please be aware of the risks associated with these stocks.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.