By Kristen Moree
The Bio-Logical Capital team had the chance to visit one of the country’s fastest growing indoor farming projects earlier this year on a team trip to New York. We arrived to a non-descript parking lot in the heart of Brooklyn outside of the old Pfizer factory. It was beginning to blizzard outside (the Northeast was experiencing the first of four Nor’easters that would later come that same month), and I remember wondering if we were in the right location - there were a handful of white shipping containers staggered next to each other in what looked like an abandoned lot, and as a passerby, one would have no idea that this same site produced bounties of fresh, hearty greens every week, all year round. And while all of Bio-Logical Capital's farming projects are soil-based, we were excited to see how this aquaponic-based system worked.
About Square Roots
Square Roots is a dual urban farming and entrepreneurship program co-founded by Tobias Peggs and Kimbal Musk. The early-stage venture uses re-purposed shipping containers to grow leafy greens and other vegetables throughout the year via a 13-month incubator program for individuals interested in learning about urban agriculture. The participating farmer fellows learn hydroponic vertical farming, as well as leadership, marketing/communications, and business skills. Each participant has their own ‘farm’ (provided by Freight Farms) and has total autonomy over what they grow. The crops grow year-round via infrared light, a controlled temperature environment, and nutrient-enhanced water pumping through the enclosed system. Participants can team up with their peers to sell their crops to the Square Roots market base throughout NYC, in hopes of developing and growing their own customer base. They deliver the produce on a weekly basis to their subscription-based customers by hopping on the subway.
Current Stage and Growth
Square Roots currently has 6 entrepreneurs in the 2017-2018 cohort. This is only their second year operating the program, and they received an astounding 400+ applications. Attracting such a high-volume applicant pool is perhaps due in large part to the fact that it is not only free to the participants, but also offers income-generating potential. Participants are able to keep a share of the profit that comes directly from their produce sales. One of the program’s goals is to demonstrate that an individual can work part-time (20 hours a week) in a “farm” shipping container and bring in an annual income of $30,000 or more.
For their third year, Square Roots is expanding the program to Chicago where they will have more shipping container farms and a new system that optimizes growing time and efficiency. They’ve developed an impressive partnership with Phillips, a health technology company based in Amsterdam, who is designing optimized LED lights that are highly compatible with their farms. When we visited, the team was experimenting with creating a new technological design and farming format with these new lights to further increase the crop yield and minimize costs.
This urban farming and entrepreneurship platform is an extremely innovative model that teaches individuals both how to farm using vertical hydroponics and how to start and grow a farming business, while simultaneously refining the vertical hydroponic farming system and its underlying technology. Shipping containers may not be the ultimate solution to farming at scale in the future, but they are serious contenders in the race to cost-effectively providing access to locally grown food in cities as our global population grows (expected to reach 9 billion by 2050 with over 60% of the population living in cities). In addition, these farms are an effective way to offer urban residents exposure to farming while cutting down on the expensive transportation and energy costs of importing food from rural areas.
We met several farmer fellows from the project and none of them had ever worked on a farm before. For them, the ability to live in a city but get to work growing food is a valuable and rare aspect of the program compared to other agricultural learning opportunities. Growing indoors (and with a focus on salad greens and herbs) is a much shorter growing cycle, which allows the farmers to try new growing methods and quickly see the results (to compare, it can take soil-based farmers several years to see the results of new practices). This is due in part to the quick successions of crops and also to the diversity possible within their systems. Furthermore, they can provide produce year-round giving potential to capitalize on the market when it is not flush with soil-grown product.
The business plan behind Square Roots faces a very difficult task, but is seemingly up for the challenge (and progressing quickly): how to make vertical hydroponic farming profitable despite the large upfront capital investment required with container farms. While their Brooklyn campus may never reach profitability due to these high initial costs (roughly $80,000 for a container farm), they are working at a rapid speed to leverage creative mechanisms that will improve both their farms’ design and lower costs throughout various aspects of their model, and quickly implementing these improvements at future locations. For example, the labor costs associated with growing and distributing the produce are essentially zero by structuring the business as an educational incubator program. Furthermore, by allowing the participants to decide on their own crops that they grow, Square Roots is capturing a ton of data around which crop varieties work the best in this type of farming system. They are able to track variables such as how much water and energy various crops require, the quality of the overall product – such as taste and texture, growing and harvesting timelines, and total output per crop. As a result, they can then tweak these factors to optimize yield and operational efficiency.
Energy and Water Use
Indoor vertical hydroponic farming is very energy-intensive. Covering the shipping containers with solar panels would only cover roughly 15-20% of total energy use. Energy in this type of farming system is largely used for irrigation (pumping water through the system), temperature control (heating and fans), and the lighting. However, the company is employing energy-reduction mechanisms where possible – such as using all energy-efficient LED bulbs. In addition, given the current growing trend of increasing efficacy and rapidly declining costs associated with renewable energy, this type of system has great potential to become energy-neutral in the near future. And while hydroponic systems rely on water as the sole vehicle for cultivation, it has the capabilities to be far less water-intensive than soil-based farming if the water is re-circulated through the system (hydroponic farms that employ water re-circulation schemes use up to 10x less water than soil-based irrigation systems). In addition, there is ample opportunity to develop rainwater collection structures that could further reduce water usage.
While the greens grown are certainly more expensive than typical organic greens consumers might purchase in a grocery store, they taste amazing and have customer demand, given their freshness that comes with sourcing them from just a few miles away.
A significant portion of the Square Roots team is comprised of engineers (from computer science to mechanical) and the organization resembles a tech startup. They are quickly able to iterate and make changes to improve their program and system. They’re also extremely resourceful in re-using and repurposing materials to enhance their farms.
Beyond the team, business model, and other drivers behind Square Roots, perhaps its most innovative aspect is its ability to offer a single platform that addresses pressing challenges that span across the environmental and social landscapes of urban development. From education to urban agriculture to technological innovation to scaling food solutions, Square Roots offers a bold vision for merging what are typically thought to be mutually exclusive worlds. It demonstrates that these entrenched urban-rural divides characterized by opposing forces such as soil and concrete, farming and technology, food supply and consumer demand (to name a few), can slowly start to dissipate in the middle of a Brooklyn parking lot.
To learn more about Square Roots, you can visit their website: www.squarerootsgrow.com