Currently, less than 1% of fresh produce is grown through hydroponics compared to open-field agriculture, but the segment is forecast by Mordor Intelligence to grow by nearly 11%, or about $600 million, by 2025. .
Fifth season
Beside the last steel mill in the poor industrial town of Braddock along the Monongahela River, just nine miles from Pittsburgh’s American Steel Towers, a vertical farming business backed by billionaire Nicholas Pritzker’s Tao Capital is springing up. as an agricultural innovator.
The startup, founded in 2016 as RoBotany by MBA student Austin Webb and incubated at Carnegie Mellon University, is aiming to disrupt the $60 billion manufacturing market. Now named Season Five looks more consumer-friendly, the upstart is taking advantage of cutting-edge technology, $75 million in venture capital, increased distribution, a new facility planned in Columbus, Ohio and an expanded management team to score in the fast-growing aquaculture market. Webb CEO confident Season Five project can be a $15 million business in Pittsburgh within five years and $500 million through geographic expansion, and it is estimated that sales will hit double-digit sales this year and increase revenue by 600%.
Webb, 33, said: “Our smart production facility improves the yield, taste and texture of vegetables and does it with 95% less water, 95% less soil and no use of soil. pesticides or chemicals”. Grow fresh produce year-round indoors in vertical trays, relying on artificial intelligence, robotics and data to control light, water and nutrients, and harvest greens.
Hydroponics is growing rapidly as a food source
Currently, less than 1% of fresh produce is grown through hydroponics compared to open-field agriculture, but the segment is forecasted by Mordor Intelligence to grow by nearly 11% annually to around $600 million by 2020. 2025. “There’s a lot of runway as prices drop,” said Brian Holland, chief executive officer of Cowen & Co. in New York. He added: “It’s been a scale-up race with multiple winners with multiple winners. the ability to demonstrate the economic model for automated, robotic growing. “Fifth Season is more advanced, if not the most advanced, on the market in combining technology and robotics for indoor vegetable growing. at a lower cost.”
Season Five is competing in a very fragmented, capital-intensive market of more than 2,000, mostly smaller farms and some larger-scale players. Among the biggest is San Francisco-based Plenty Unlimited, which recently raised $400 million in strategic funding from Walmart and plans to sell fresh produce from its Compton facility at retailer stores in California. Another major player is AeroFarms of Newark, New Jersey, which canceled its SPAC contract to go public in October 2021 and is continuing to build capacity at a farm in Danville, Virginia.
“Leading the market is just a function of time and a function of capital,” says Webb.
Racing to build its business and keep up with its competitors, Fifth Season plans to build a second indoor horticulture farm by 2023 and is in talks to buy a parcel of land in Columbus, Ohio, near John Glenn Airport. Through a partnership with hummus maker Sabra in December 2021, the company also introduced a new line of co-branded products, salad topper kits, priced between $6 and $8. The distribution of the company’s products will be expanded this March at more Giant Eagle stores as well as Kroger and ShopRite across 10 states and 1,000 locations, with a goal of reaching 3,000 grocery stores by 2023. In its first year of commercial operations in 2000, approximately 500,000 pounds of its product was made available to retailers. Neighborhood restaurants and on-site dining options from 60,000 square feet of planting space on a half acre of land.
A new Rust Belt boom
Fifth Season’s growth boom heralds a new high-tech era for the former steelmaking capital. Dozens of tech startups in the area are emerging in Pittsburgh and during the former Rust Belt as old-fashioned factory workers move into engineering jobs and older industrial towns reboot .
“The tech factor isn’t lifting all the boats, but it’s spreading across the country,” said Silicon Valley Congressman Ro Khanna, author of Dignity in the Digital Age.
“The factory workers and technicians know how to make things and have a distinctive work ethic that is ethnic and community-based. They are defying previous conventions,” he said.
Looking forward, Fifth Season expanded its leadership team in January, while headcount is expected to grow to 100 next year from 80 currently. Finance and technology veteran Brian Griffiths joined as CFO from semiconductor company Skorpios Technologies with experience at Credit Suisse and Guggenheim Partners. Varun Khanna was hired as vice president of food products from leadership positions at Chobani and Sabra. Glenn Wells joins as senior vice president of sales and has previously worked at Quaker Oats, Welch’s and Dole.
Another spearhead of its growth strategy is a planned $70 million outlay on a new Columbus vertical farm three times the size of the $27 million Braddock plant, which includes property development for land, a building and equipment. The company’s highly automated farms require only 35 to 50 production workers. The Pittsburgh plant produces four million salads annually, while the larger central Ohio location is expected to produce 15 million. Fifth Season is working with economic development teams One Columbus and Jobs Ohio on the new location.
Connect Carnegie Mellon
The foundation for Fifth Season’s game-changing business comes from the strength of mind at Carnegie Mellon University and Pittsburgh’s technology business cluster in computer science, robotics, and engineering. Webb developed a prototype in his senior year of his MBA and launched the business upon graduation with co-founder Austin Lawrence, an environmental scientist and mechanical engineer he met on campus. school.
The third co-founder, Webb’s brother Brac, is the CTO. He designs production software. The system was stress-tested for two years in a converted steel plant south of Pittsburgh before Braddock Farms began operations in 2020.
Webb was mentored by Dave Mawhinney, executive director of CMU’s Schwartz Center for Entrepreneurship, who helped him connect with investors and role models like serial entrepreneur Luis von Ahn, founder of the edtech company. Duolingo is based in Pittsburgh. He also introduced MBA student, Grant Vandenbussche, a former General Mills global strategy coordinator who joined the team in 2018 as business development manager and now category manager. “The fifth season is a testament to CMU’s ability to attract very talented young people and develop entrepreneurs through its MBA programme,” said Mawhinney. “It’s all about the network.”
Fifth season CEO Austin Webb
Fifth season
Even before graduating in 2017, Webb had funded angel investors, most of whom had connections to CMU. Network effects also played out when Mawhinney introduced Webb to Columbus-based VC firm Drive Capital, which started with $1 million in 2017 and led a $35 million round in 2019 when it exit stealth mode, rename. from RoBotany and Drive partner Chris Olsen joined as board members.
“Chris pushed us to think hard about the market and think bigger nationally, not just locally or regionally, while building a lasting company and a new product line,” says Vandenbussche. .
The $75 million it has raised to date from investors including not only Pritzker’s Tao Capital Partners of San Francisco but also the eight different investor groups involved in 2021.
“Pittsburgh is coming together as an ecosystem. Stronghold Digital Mining company in Pittsburgh,” said Kit Mueller, head of community networking group RustBuilt and recently became vice president of crypto-assets.
No longer reliant on steel, iron and rivers as a competitive advantage, the city is transforming from raw industries and robotics startups are focusing on the so-called Silicon Strip of warehouses. before. The city of 303,000 people on average, less than half of its peak population of 677,000 in 1950, has emerged as a technology testbed for the self-driving technology of Argo AI invested by Ford and Aurora by Ford. Amazon backed, and Uber’s technology unit was acquired by Aurora. It is also the anchor for the R&D labs at Facebook, Apple, Google, Zoom, and Intel.
One lingering problem that Midwest startups face is a lack of venture capital. California, New York, and Boston record about two-thirds of the total $329.9 billion in startup investments in 2021. This imbalance is starting to shift toward specialized domestic hubs as members maintain formations like Pittsburgh with robotics as well as Cleveland with biotechnology and Indianapolis with SaaS.
Improved lifestyle amenities, increased opportunities and a lower cost of living are among the attractions that attract young tech talent to local hubs. Fifth Season’s co-founders and many others came to Pittsburgh to pursue entrepreneurship and have stayed.
“The only people who don’t like Pittsburgh are the people who never came here and the people who left but never came back,” said Lynsie Campbell, a series founder who has toured New York, Los Angeles, and San Francisco. Francisco but returned home as a Pittsburgh-based Partner with The Fund Midwest, and a leader in the city’s startup and venture capital sectors.
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