US (NY): Taking on the Eastcoast in phased expansion, raising another $10 million

Baking Profitability into the Model: CubicAcres Secures Funding for Sustainable Vertical Farming

Founder and CEO of CubicAcres, Ryan McGann, emphasizes the company’s commitment to sustainable development goals (SDGs) in their vertical farming operations. By minimizing external inputs and designing systems that enhance agricultural land, CubicAcres aims to create a mesh network of vertical farming Grow Hubs tailored to local needs.

Distributing Grow Hubs for Agricultural Production Boost

CubicAcres plans to distribute their Grow Hubs strategically, covering a 50 to 100-mile radius of urban areas. This approach allows various farmers to become eligible partners for the on-site model, significantly boosting agricultural production using existing infrastructure.

Ryan McGann, pictured on the left as he closed the deal back in February with IGS’ David Farquhar.

Expansion Plans and Funding

After securing a $3.7 million funding round in July, CubicAcres plans to raise an additional $10 million to expand their operations. Ryan highlights the East Coast as an ideal location for vertical farming, given its distance from California’s Central Valley and Arizona, where 97% of lettuce is currently grown. Consumers appreciate the freshness and quality difference offered by locally grown produce.

CubicAcres initially supplied full-head lettuces in bulk to restaurants, but they are now working with distributors like Sysco and aiming to include grocery stores in their distribution network.

The company’s goal is to achieve a “Seed to Salad” process with minimal human contact. By utilizing best-in-class systems such as IGS towers and TTAs transplanting machines, CubicAcres plans to grow a variety of leafy greens, herbs, and microgreens for Long Island and NYC residents, with a focus on full head lettuces. They will closely collaborate with restaurants and distribution partners to meet crop demands.

Phased Expansion and Addressing Agricultural Land Shortage

The construction of a 1000m2 farm is underway and scheduled to start production in Q1 2024. CubicAcres plans to add 16 grow towers over a 3-year timeline. The company’s second grow hub will be located in the New York Metro area, potentially in upstate New York, New Jersey, or even inside New York City.

Ryan emphasizes the urgent need for indoor farming in the US due to decreasing agricultural land availability. He highlights a report stating that there is only an average of half an acre per person to support their annual needs, including dairy, meat, fruits, vegetables, and cotton. Additionally, the impending el niño pattern will further accelerate the demand for sustainable farming solutions.

Ryan pictured in his first farming project, using container farms that are still in use for R&D purposes (Photo credit: Freight Farms).

Correction Period and Profitability Challenges

Ryan believes that the vertical farming industry is currently going through a correction period. CubicAcres spent the past two years observing the industry and adjusting their methods and strategies to mitigate risks faced by other companies. Factors such as power costs, labor costs, and bloated R&D overhead have posed challenges for early vertical farming operations.

However, Ryan predicts that this correction period will lead to stronger vertical farming companies that are better equipped to withstand challenges. While there is a high demand for produce grown in vertical farms, profitability remains a challenge.

Recognizing the logistical fragility and quality gaps in Long Island’s agricultural infrastructure, Ryan chose the region as an ideal starting point for CubicAcres’ sustainable vertical farming venture.

For more information:

Ryan McGann, Founder and CEO

CubicAcres

Tel.: +1 631 678 6231

verticalfarmdaily.com

Join us, as fellow seekers of change, on a transformative journey at https://sdgtalks.ai/welcome, where you can become a member and actively contribute to shaping a brighter future.