December 06, 2024

Nelson Zandbergen
Farmers Forum

CORNWALL — Eric Lang grew up on a Glengarry County dairy farm dependent on the weather and the bounty of the great outdoors. But since 2016, Lang has built up an Eastern Ontario company focused on indoor farming and vertical growing. Cornwall-based ZipGrow Inc. has been making an impact in so-called “closed environment agriculture.”

The company — recently recognized with an Ontario Excellence in Agriculture award — manufactures commercial indoor veggie growing systems based on a vertical hydroponic tower invented at the University of Wyoming about 15 years ago. ZipGrow bought the exclusive worldwide licensing rights to the design, which Lang touts as more space-efficient. The company’s versatile systems range as small as a single tower that can fit in a kitchen or classroom, up to shipping container-sized setups and much larger retrofits of indoor commercial spaces filled with the upright towers. Produce with the highest return are herbs and baby lettuce, with most buyers of this produce being restaurateurs and grocery stores.

Other indoor growing manufacturers may have more revenue, but in terms of individual systems sold, ZipGrow leads the world with installations in over 30 countries, according to Lang, who still lives on that ancestral Williamstown farm where his wife now raises beef animals. He says his gross revenue is “only” $5 million per year and expects it to grow. He employs 10 to 15 employees assembling, welding, painting and shipping the steel and plastic growing towers.

What sets him apart are his roots in regular farming, “and I come at this industry from that perspective,” the company founder and CEO says.

By contrast, many of his competitors look at the indoor ag sector “as a tech play, or they think it’s a biotech play, or more like a software play,” he says. “Everyone gets excited that you can operate the farm from your phone. Well, okay, you can change the settings, but that’s not farming.

“That’s the biggest thing I try to explain to these people,” he says, emphasizing that indoor farming “is still farming. It’s actually work, and you’ve got to be there all day, every day…. It’s not a machine that makes lettuce.”

Lang earned his teacher’s certificate before going into business and becoming an entrepreneur. It was in his previous business, a plastics company, that he started looking into closed environment agriculture. An employee’s spouse wanted to set up a container farm and Lang lent the money. “I thought it was a complete gimmick, but the more I looked into it, the more I realized it’s actually not a joke,” he recalls. Indoor farming offers existing farms the opportunity to extend their season to 12 months a year, and it represents a way for aspiring farmers to gain an agricultural foothold. “It actually breaks down the barrier to entry into farming. For that, I’m really grateful.”

The sector has taken off in the last seven or eight years, he says, thanks to the LED lighting revolution. Just as the advent of the lithium ion battery paved the way for electric cars, the emergence of highly efficient and affordable LED lights made growing plants in windowless spaces economically viable because of the electricity savings. Because of that advance, electricity now accounts for half the cost of producing plants under artificial light, he says, and it’s now possible to grow vegetables indoors at prices competitive with certain imports.

A typical shipping-container unit filled with ZipGrow’s technology sells for about $200,000, he says. For those wanting the output of more than two containers, he recommends setting up inside a larger building as more viable. Return on investment is achievable in five years on the $200,000 system, but the operator must grow the correct products — and definitely not unprofitable lettuce.

Lettuce offers the lowest return and costs the same to grow as higher margin herbs, he points out. “I tell everyone right off the bat, don’t ever grow lettuce. It’s just a waste of time.”

It’s only in the last couple of years that ZipGrow has made attempts to market directly to farmers, starting with a display at the 2022 International Plowing Match in Kemptville. Lang said he was pleased by the reception at the IPM where “real farmers” told him “this makes total sense. This could actually be a way to get my son or my daughter to come home.”