Soli chief executive Matt Ryan told Agri Investor that Cascade’s investment marked its first foray into controlled environment ag. The size of the investment has not been disclosed.
“Cascade gets it,” said Ryan, who served separate stints as executive vice president for strategy and marketing at Starbucks before joining Soli in June.
“The history of us as an agriculture company that really truly understands growing, and is not just a science company doing an experiment – that really appealed a lot to them,” he said. Cascade declined to comment.
Soli, which is headquartered in Rockingham, Virginia, was established in 1989. It supplies 20,000 retail locations with organic herbs and greens through a network of processing facilities and seven soil-based indoor farms.
Cascade’s investment was announced alongside Soli’s $120 million financing agreement with Decennial Group, a social impact-focused real estate investment firm headquartered in Chicago. The financing will support the construction of CEA facilities within Opportunity Zones, benefiting from a 2017 law designed to spur investment in economically disadvantaged US regions.
“Not every one of the facilities we can [build] or will build will be in an Opportunity Zone, but if we could replicate the deal with them again, we would certainly do it,” Ryan said. “We are looking at everything and that’s an important part of what we have to do in a capital-intensive business.”
At an average construction cost of between $40 million and $50 million each, he explained, Soli expects its agreement with Decennial will support the construction of about three facilities, with minimal need for additional investment. Soli’s plans call for the construction of eight facilities and it expects to begin production from a South Carolina farm, already under construction, by mid-2022.
Ryan added that while that search for financing options does not currently include special purpose acquisition companies, Soli continues to monitor the market.
“There have been some recent missteps in the SPAC market lately – not just in our sector, though certainly in our sector – but across the board,” he said.
“It’s been a choppy market and is not necessarily the best way of raising capital at this very juncture in time. We’re open to it, if the market turns and we see signs it makes sense for us, but certainly other means – private rounds and IPOs – are on the table as well.”
Cascade’s recent investment came alongside another investment of an undisclosed size by Alexandria Venture Investments, which contributed to a total of $125 million Soli has raised from equity investors that include S2G, Middleland Capital and others.
Ryan joined Soli after more than seven years in Seattle-based roles at Starbucks, following 15 years with the Walt Disney Company, according to his LinkedIn profile. He said his time with Starbucks included direct exposure to the agricultural supply chains critical to the coffee giant’s global business.
As part of the rebranding reflected in the company’s name change, Ryan explained, Soli’s product offerings will transition from the current ‘That’s Tasty’ brand to ‘Soli Organic’.