AgTech & Sustainability Strategic Thought Leader with 25+ Years of Investment Banking Experience / LinkedIn Top Voice for Finance
Those who attended the “Scaling CEA: Funding Models and Partnerships for Nationwide Expansion” panel at Indoor AgTech Innovation Summit on June 24th heard valuable insight on how CEA companies need to navigate the challenging financing landscape to be able to fund new indoor farms. I was privileged to moderate this panel featuring Elan Kramer, Generate; Marc Khouzami, BMO Sustainable Fund; and Sue Yang-Krochmal, Antin Infrastructure Partners. The panelists’ investing strategies offer different funding vehicles, ranging from infrastructure, growth / PE, and project finance. To date, too much corporate equity has been raised by CEA companies, a strategy that is not viable in the future, as hard assets, including indoor farms, should not be funded with corporate equity, which is much more costly than other forms of capital (bank debt, mezzanine, project finance). The challenges the CEA sector faces today are mostly due to raising too much capital at too high valuations, and not executing on business plans. The keys to success are to prioritize building a viable business and achieving positive EBITDA and cash flow. We also discussed the need for stronger relationships with strategic partners, including signing offtake agreements with distributors or retailers. Elan discussed how Generate provided project equity for Better Future Farms and brought Taylor Farms in for the product offtake. Sue shared how Antin had looked at both the greenhouse and vertical farming sectors, but didn’t find many suitable targets as an infrastructure investor as so few companies are close to profitability. Marc provided insight on how the sector had changed since investing in Gotham Greens a few years ago as well as future opportunities for consolidation. As to the future of the CEA sector, all the panelists had a positive long-term view, but many short-term concerns, particularly as more companies are expected to go bankrupt over the next couple of years. Adam Greenberg Arama Kukutai Barry Murchie Dorn Wenninger Gilwoo Lee Jed Lynch Michael Rose Nick Houshower Nona Yehia Paul Sellew Matthew Lohr Randall Lewis, CPA Rob Dongoski Stephan Dolezalek Tobias Peggs Viraj Puri #indoorag #indoorfarming #verticalfarming #cea #foodsecurity #foodtech #food #sustainability #sustainable #sustainableag #sustainabledevelopment #climatechange #cleantech #climate #agtech #agriculture #farming #foodindustry #technology #innovation #investment #finance
Adam Bergman
2mo
Abby Craig Prior Alexander Corbacho Amir Karian Andy Allen Andrew Howell Bas Duijvestijn Blake Lange Christopher Evanich Colin O'Neil Damion Schwarzkachel Deborah Koh Derek Smith Dick Kramp Edward Verbakel Eric Noller Gentiane Gorlier Glenn Behrman Halton Peters Jennifer Bromley Jessica Naomi Fong Joe Weber Johanna Waterous John Staniszewski Jon Lomow Josh Waters Joost Somford Junell A. Louis Brun Luc Lalire Martin Helmich Martin Ruebelt Matthew Bonavita Nicolas Weber Patrik J. Borenius Rob van Straten Rodrigo Santana Rory Schmick Sandro van Kouteren Sarah Lombardi Sara Lea Neagu-Reed Sean O'Connor Sean Walsh Suhas Narayanaswamy Tanuj Dutta Thijs P. Tom Parker Tom Spaulding Tom Stenzel Willem Kesteloo Yan Branco Stephan Groves Abigail Ryder Liam Littrup Jensen Tate Slyfield Sophie Brady Jasmine Baker Rachel Mackie Tom Bennett Callum Alexander-Lindsay Joe Alexander Dicksee
Great lineup!
Kimberley Player
2mo
Spot on commentary, Adam, and I agree with both the positive long-term and painful short-term forecasts.
Phil Killham
2mo
Adam, it was a great panel and I enjoyed hearing the different perspectives from the capital side. One area not touched on was lowering the costs of facilities to start closer to profitability. I'm looking forward to this discussion at one of the next IndoorAg's. Thank you for your posts, they are always on point and packed full of incredible information on the CEA sector.
AgTech & Sustainability Strategic Thought Leader with 25+ Years of Investment Banking Experience / LinkedIn Top Voice for Finance
2mo80 Acres Farms Bowery Farming BrightFarms CEA Alliance Ceres Partners, LLC Certhon Cleveland Avenue COFRA Common Farms Congruent Ventures Equilibrium Capital Fieldless GoodLeaf Farms Gordon Food Service Gotham Greens Grosvenor Food & AgTech International Fresh Produce Association IUNU Hardee Fresh Kearney Lewis & Clark Ventures Little Leaf Farms NatureSweet Oasthouse Ventures Limited Ventures Paine Schwartz Partners Pairwise Parus Europe Philips Lighting Plenty® Red Sun Farms Rethink Events Schneider Electric Sobeys Square Roots Skytree The Yield Lab UNFI US Foods Vertical Future Village Farms Fresh Zordi