By investing in vertical farming, Walmart, the world’s largest retailer, is pushing vertical integration to a new level. Yes, the merchant, who already has his bank, goes into agriculture. It matters to them, or at least to vertical farming.
Walmart, which employs two million people, recently acquired a stake in Plenty Unlimited in a $400 million funding round, giving it a place on Plenty’s board — and at the table. closed.
Walmart relies on vertical farming, saying it can deliver “the freshness and quality Walmart customers expect year-round.”
Vertical agricultural statistics
Vertical farming brings farms to cities and towns. Farms are established with addresses in major new agricultural capitals such as, well, Chicago, Baltimore and New York. Even when some store racks are going bare, other businesses are turning to vertical farming as a solution.
Don’t be so confident if you think farming is more about land than technology. According to Finistere Ventures’ AgriFood Tech Investment Review 2020, there is more money flowing into high-tech agriculture. In 2020, global investment in agtech companies is expected to reach $22.3 billion, including $5 billion in agtech and $17.3 billion in food tech. Finistère expects 2021 to surpass this record year as agricultural technology advances.
“We expect 2021 to outperform 2020 as funding continues to flow into tech categories with absolutely huge potential for disruption, like indoor farming…,” according to Arama Kukutai, co-founder and partner of Finistere Ventures.
How environmentally friendly is this company? According to Fortune Business Insights, the global vertical agriculture industry was worth $3 billion in 2020 and is projected to be worth $3.6 billion in 2021 and $17.6 billion by 2028. However, when the money hits, it could be a drop in the bucket.
“With increasing populations and continued advances in global food markets, options for more robust agricultural production must be brought closer to urban areas,” according to Fortune Business Insights, which considers vertical farming part of “ a viable agricultural solution”.
Vertical farming is on the rise
This all translates into seed funding for start-ups as well as investment from companies like Walmart. According to The Associated Press, at least 74 indoor farming businesses were launched in 2020, according to consultancy Agritecture. Companies are expanding their market share, not just their product offerings.
Gotham Greens, which has 500,000 square feet of greenhouse space, claims to use 95% less water and 97% less land than typical farms, saving energy and waste.
When it comes to agriculture, other businesses are on the rise. According to TechCrunch.com, Brooklyn-based Upward Farms plans to create a 250,000 square foot vertical farm in northeastern Pennsylvania. It will grow microgreens, which TechCrunch.com described as “a popular choice for indoor gardening due to its versatility and reduced space requirements.”
Green thumb for investment in vertical farming
Investors are testing their green thumbs in hopes that vertical farming will pay off. According to Fortune Business Insights, McCain Foods announced a “significant investment” in Truleaf Sustainable Agriculture, a Canadian vertical agriculture company, in February.
Meanwhile, Walmart is experimenting with agriculture by investing in it. Could Walmart be wrong? It’s still possible, but the company hasn’t gotten this far by making so many bad investments. Could this be the start of something bigger as companies bet (on) the farm?
According to the company, “Walmart is the first major US retailer to aggressively engage in vertical farming,” and it is working with many “to bring fresh produce to Walmart retail stores.” Oh, and if all goes well, it can also help investors profit from it.