Date: Jan 24, 2023
Category:

Controlled Environment Agriculture (CEA) remains a very controversial and high-profile space. As one of the largest investment categories in AgriFoodTech, vertical farming and greenhouse startups have received over $7 billion in venture investment the past five years.

Companies like Plenty, Bowery and AeroFarms have received large investments in part because of the media’s over-hype of the entire space. Vertical farming, in particular, has been seen as a game changer for food production and positioned as a fully buzzword-compliant Farming 2.0 offering that meets all of the modern consumer’s requirements around sustainability, locally grown, traceability, and organic (or at least organic-equivalent) production.

But a funny thing happened on the way to the finish line after investors wrote all those checks. It turns out that vertical farming is not all green fields and unicorns – in fact, it turns out that almost all vertical farming products end up competing on the way to the customer with a lot of Western Growers members that have worked hard to optimize supply chains and relationships with the person buying food in stores and restaurants.

The lack of a clear go-to market strategy around products that taste great, are priced right, and are something consumers want to put in their shopping cart or on their plate is hurting a lot of well-funded vertical farms – and that should not be a surprise. There will be a few winners in vertical farming and green house operations, but there’s going to be a lot of bad investment outcomes as well.

All the investors and founders who didn’t understand the competitive dynamic of the food space now have a huge clean up on Aisle 10 (and 11 … and 12).

To read more from WG's VP of Innovation Walt Duflock, visit his blog

WG Staff Contact

Walt Duflock
Vice President of Innovation

Start Growing Today

Farming has never been more challenging, which is why Western Growers invests in fully committed advocates – your advocates – in Sacramento, Phoenix, and Washington, D.C.  Only Western Growers offers members so many business services, supported by more than 400 dedicated employees.

You May Also Like…