Vertical farming startup Oishii raises $50M to develop strawberries

Dive Transient:

  • Manhattan-based vertical farming startup Oishii has raised $50 million in a Collection A spherical led by SPARX Group’s Mirai Creation Fund II, which incorporates Toyota Motor Corp. amongst its founders. The startup claims to have a proprietary method to pollinating strawberries indoors utilizing bees impressed by conventional Japanese farming strategies.
  • The brand new funds might be used to construct vertical strawberry farms in new markets whereas increasing Oishii’s flagship Manhattan farm. The corporate may also put money into additional R&D, creating new strawberry varietals in addition to different kinds of produce, together with tomatoes, melons and peppers
  • Whereas vertical farming isn’t new, most operations deal with producing leafy greens and herbs. Oishii is without doubt one of the first vertical farming startups to dig into indoor strawberry cultivation alongside fellow vertical farming startup Loads.

Dive Perception:

Indoor farming has attracted enterprise capital buyers’ consideration lately as a result of its potential to deliver recent produce to main metropolitan areas year-round whereas utilizing fewer assets than standard subject farming in some circumstances. What makes Oishii distinctive, nonetheless, is its deal with cultivating strawberries indoors. The fruit has been significantly difficult to lift inside as a result of its longer cultivation cycle and sophisticated pollination course of in comparison with leafy greens and herbs.

Oishii first hit the market in 2018 with its Omakase Berry, a Japanese varietal recognized for sweetness, aroma and a creamy texture. It claims that it was the primary to supply the berry within the U.S. To realize indoor strawberry cultivation, Oishii mentioned it faucets conventional Japanese rising practices and AI-enabled automation, and makes use of bees to deal with pollination. The startup hasn’t shared many particulars about how this course of works, nevertheless it seems to be the one vertical farming operation that enlists bugs.

Shoppers are craving strawberries greater than ever, based on Rabobank’s US Strawberry Market Replace 2021. Shipments of strawberries to the U.S. elevated roughly 4% year-over-year throughout 2020 for conventionally grown berries, whereas natural strawberries noticed an 11% bounce. The 2020 crop was affected by some weather-related occasions; this makes indoor cultivation, the place operators management the climate across the clock, a pretty choice for rising the berry. 

The variety of strawberry acres planted in California elevated 3% in 2020, as nicely, reaching the very best stage on report since 2015, based on the Rabobank report, whereas Florida acres planted had been up 5%. These figures are significantly spectacular contemplating the devastating affect of COVID-19 on shopper buying patterns, the provision of on-farm labor in the course of the strawberry harvest, and provide chain hang-ups. This previous April, main strawberry producer Driscoll’s reported a 20% drop in gross sales due to the pandemic.

Oishii has some stiff competitors on its heels. Driscoll’s lately teamed up with vertical farming startup Loads to discover indoor strawberry cultivation. Loads is making use of Driscoll’s proprietary genetics and berry experience to its indoor farming know-how. A number of the objectives of the partnership embrace perfecting a constant taste, texture, and measurement for the berries whereas mitigating the affect of climate.

Indoor farming startups are nonetheless getting loads of consideration from buyers even when they aren’t rising berries. BrightFarms raised $100 million in October 2020. It gives branded packaged salads and sells by means of quite a lot of main grocers together with Walmart, Kroger, and Ahold Delhaize’s banners. 

Revol Greens scooped up $68 million in funding for growth whereas Kentucky-based high-tech greenhouse operator AppHarvest lately went public by means of a SPAC financing. The latter counts Martha Stewart and former Not possible Meals CFO David Lee as board members. Ikea-backed AeroFarms has additionally raised over $200 million in enterprise funding for its New Jersey-based aquaponics operation.

Bayer can also be getting in on the indoor farming sport by means of its funding arm in partnership with Singapore-based international funding agency Temasek. The duo are forming a brand new enterprise referred to as Unfold that can again startups in vertical farming. This consists of creating new seeds and agronomics tailor-made to indoor rising operations.

 

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