Agtech startup AppHarvest has secured an $82 million investment from Equilibrium Capital’s Controlled Environment Foods Fund to build its 60-acre high-tech greenhouse in Morehead, Kentucky.
In addition to the cash infusion, the startup has also raised a Series A equity round of an undisclosed amount, led by ValueAct Spring Fund with participation from existing investor Revolution’s Rise of the Rest Seed Fund.
CEO Jonathan Webb shares that the Series A funds are earmarked for building out the startup’s team in advance of the facility opening in 2020. The $82 million, meanwhile, will go directly toward construction.
“We’ve grown our staff considerably [in the last year], bought our property and started construction, but I’m most proud of our community work,” Webb tells Hypepotamus.
Webb founded AppHarvest as a way to provide high-paying jobs, alternative education, and new methods of farming to Kentucky, one of the U.S. states with the highest unemployment rates after the loss of the area’s coal mining jobs.
AppHarvest also launched an agricultural entrepreneurs program this year at a local Pike County high school. They built a high-tech farm inside a shipping container and let students decide what to grow and how to allocate the harvest.
“Our goal is to build on the already increasing interest in AgTech in Eastern Kentucky. As more and more people become exposed to the AgTech industry, that will create a burgeoning workforce. But, above all, we seek to instill in students the excitement of entrepreneurship,” he says.
With the cash investment, AppHarvest has begun construction on the 60-acre controlled-environment greenhouse. The facility will grow tomatoes and cucumbers.
The greenhouse will be equipped with irrigation systems that will reduce water usage by 90 percent (compared to open-field cultivation), vertical crops, and technology to control the environment year-round. Built-in software will react in real-time to incoming weather patterns and temperature changes, and address fertilizer and humidity needs.
Once complete, the facility will create 285 full-time permanent jobs and provide opportunities for further education.
“We’ve already begun working with area universities on the program. The support from the community and state as a whole has been incredible. These truly are the hardest working men and women in the country, and we’re beyond excited to start operations next year,” says Webb.
The Kentucky-born founder and his team originally envisioned the high-tech greenhouse in Pikeville, Kentucky, on a reclaimed surface mine site area. However, upon surveying the area, Webb shares that their 2.7 million square feet glass-and-steel structure would not be suited for the land.
They decided to move the facility to Morehead, Kentucky.
“AppHarvest has a unique and exciting model to provide cost-effective produce through sustainable farming methods,” said J.D. Vance, Revolution’s Rise of the Rest Seed Fund Managing Partner.
“At the same time, we’re hopeful the company will be a boon to the region’s workers and communities. We’re very proud to have been supportive of the AppHarvest mission, and we’re excited to partner with them in the years ahead.”
Webb emphasizes that as a benefit corporation, he hopes AppHarvest helps create more sustainable farming initiatives and increase the shelf life of the country’s produce by growing it locally.
“By establishing a homegrown food supply here in the central location of Appalachia, we’ll be able to reach 70 percent of the U.S. population in just a day’s drive. Instead of food that’s picked long before it’s ripe, people will enjoy flavorful tomatoes and cucumbers picked, in many cases, the same day,” says Webb.
The first greenhouse is expected to open in 2020.
