Wheatsheaf leads $20m raise for indoor farming specialist

Agriculture investment firm Wheatsheaf Group, which prides itself on its sustainable investment agenda, has led a $20 million Series B raise for vertical farming pioneers AeroFarms.

The New Jersey-based company will use the investment to complete construction of its global headquarters, which will also house the “world’s largest indoor vertical farm,” according to a press release. It will grow baby leafy greens and herbs.

Joining Wheatsheaf in the raise were sustainable-focused private equity firm MissionPoint Capital, agri-focused venture capital firm MiddleLand Capital and early-stage tech venture capital firm GSR Ventures.

AeroFarms is also working with Goldman Sachs and Prudential Financial to raise over $70 million to grow the company’s market share in the indoor farming sector.

AeroFarms grows and sells about 20 varieties to food service businesses and grocery stores, including kale, rocket and watercress. It also plans to launch a consumer label in 2016, according to news reports.

The company boasts its aeroponics growing technique allows it to produce 10 times the yield per square foot achieved through hydroponic growth systems and 75 times those seen on conventional farms.  The indoor farms are used to grow greens without soil, sunlight or pesticides, and use 95 percent less water and 40 percent less nutrients than conventional farms.

“We are particularly excited about increasing our research and development efforts in order to improve quality and lower costs through streamlined operations and decreased capital expenditure,” said AeroFarms chief executive David Rosenberg.

Wheatsheaf Group was established by the Duke of Westminster’s Grosvenor Estate in 2012. The firm comprises a portfolio of 15 sustainable agriculture, water and energy companies.

A representative for the fund declined to comment on the value of Wheatsheaf’s investment in AeroFarms. The fund’s previous investments include £12.6 million into BluWrap, a maker of food shelf-life extension technology and $5 million into Enterra Feed, a Vancouver-based animal feed producer.

GSR managing director, Sonny Wu, said the firm saw opportunities for synergy between AeroFarms and other GSR portfolio companies, which include several LED chip and lighting companies.

“When we invest, we are looking for differentiating technology and the ability to scale, and AeroFarms delivers on both fronts. AeroFarms has led the way in understanding how plants see light in order to optimize the plants for taste, texture, nutrition, and yield and we see applications for this technology around the world,” said Wu.