This interview details Grow-tec, a company with a unique indoor vertical farming solution for fruity vegetables (tomatoes and cucumbers). The interview is with Ilan Ofer, Chief Strategy & Marketing Officer of Grow-tec.
What is the origin story of Grow-tec?
The company was founded back in 2004 as a family-owned business by entrepreneur and original CEO, Shlomy Raziel. Initially, the company focused on controlled environment agriculture projects, cultivating a variety of crops. However, since around 2017, the company has shifted its focus towards indoor cannabis cultivation and drying, even launching a successful cannabis drying system.
In 2022, the company announced a proof of concept for a new vertical farming solution that could cultivate fruity vegetables indoors, specifically tomatoes and cucumbers. The technology is capable of growing these vegetables in tiers and achieving yields per unit area that are dramatically higher than any other existing solution. The company's innovative approach convinced angel investors to invest in the company in May 2022, marking a turning point for the company's growth and expansion.
Today, the company has two main lines of business. The first focuses on cannabis drying rooms and indoor cultivation projects, which generate the company's ongoing revenue stream. The second is the company's next innovation, which centers around vertical farming and its unique ability to cultivate fruity vegetables with unprecedented yields per square ft. which are 10 times and more higher than the most sophisticated greenhouses. The company's patented concept of intercropping also allows for the growth of leafy greens (e.g. lettuce) almost for free on vacant sidewalls utilizing existing lighting climate control and real-estate , adding to the product offering and output with only a marginal added cost.
What are the biggest challenges?
As an agriculture innovator, one of the biggest challenges is breaking into new markets. It's not enough to simply have a great product or service; you need to find customers who are willing to give it a try. In Grow-tec's case, we believe that the early adopters will be in specific geographies that are typically agriculturally challenged. These are places where our innovative approach can make a real difference.
We've identified several potential markets, like the UAE, Qatar, Singapore to start with. These are places where water or available real-estate are scarce and the climate is increasingly hostile, making traditional agriculture methods difficult or impossible.
Further down the road we believe that there are also potential customers in places like Japan, Scandinavia, and even some areas in the US, such as the Southwest, that face similar challenges with water supply or climate.
Our innovative methods allow for much more efficient use of water and other resources, not only in comparison to open field farming but also when compared to greenhouses, making it possible to grow vegetables practically everywhere, year-round, with no external constraints. We're still at the pilot stage, and creating inroads and securing initial customer projects is the main challenge at this point.
What is unique about Grow-tec?
The plants are grown horizontally, which induces a different plant behavior resulting in a higher density of vegetables and better yields. We then stack 5 or 6 levels of densely populated plants in a vertical rack, hence the name vertical farming.
The positioning of the plants is another factor to consider. The plants are positioned in a specific way, with a first row of leading plants and a second row of chasing plants. This method ensures that the entire length of the plant produces vegetables, covering the parts of the stem that do not.
Apart from these two factors, several other aspects influence the yields, such as precise monitoring and regular regulation of temperature, CO2, humidity, irrigation, and fertilization. These aspects are controlled through automation systems. Additionally, customized lighting solutions are used which are designed and controlled to cater to the plants' specific spectrum requirements.
What is the impact of Grow-tec so far (revenue, customer quantity, etc)?
Currently, we have a functional pilot in our own facility in Israel that we utilize for testing various kinds of varieties, metrics, outputs, and inputs. This allows us to examine the consumption of inputs such as energy while also demonstrating the technology's potential to customers. We are also currently in advanced discussions with a few of these customers regarding mid-sized projects.
A full-sized cultivation facility implementing this technology would encompass approximately 4,000 square meters of net growing area. However, for pilot projects, we typically discuss a facility that covers roughly 250 square meters of net growing area, though this can vary depending on the customer.
A full-scale 4,000 square meter facility utilizing this system is capable of producing around 4,000 tons of produce each year (tomatoes, cucumbers and lettuce, all in the same facility), resulting in a high return on investment. The payback period varies based on geography and is impacted by factors such as the cost of inputs, including energy, labor, water, and fertilizers, as well as the sale price of the vegetables.
The unit economics can vary depending on the region. Our calculations indicate a payback period ranging from 5 to 10 years, depending on energy costs and vegetables market prices, and such a facility can continue to operate for 20 years or even longer.
How can people learn more about Grow-tec?
We are about to launch a new website, but people can see our current website https://grow-tec.com.
For specific questions about Grow-tec, people can reach out through the website or social media channels.
Follow GrowTec on social media: GrowTec maintains an active presence on social media platforms. Follow us on Social Media to stay up to date on the latest news, events, and developments from the company.
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