Dave Augustine, co-founder and CEO of Living Greens Farms of Faribault, Mn., is expanding from a three-year-old 5,000-square foot prototype "indoor farm" to 45,000 square feet.
A veteran corporate electrical engineer, Augustine and Chairman Dana Anderson, the other co-founder, have financed Living Greens so far with $7 million in 40 friends-and-family member equity, and sales of produce to food cooperatives and several grocers.
"The expansion is half built," Augustine said last week. "Our technological advantage is taking common growing equipment and re-engineering it so that we can grow a lot more product in a lot less space for less capital cost, less labor, energy and water."
Augustine, who projects profitability next year on sales of about $4.5 million, has started to solicit institutional investors for up to $20 million in additional equity capital.
Living Greens Farms of Faribault is growing indoors
CEO Dave Augustine is expanding to 45,000 square feet and hopes to raise up to $20 million from institutional equity investors.
Living Greens has signed a distribution deal with Robinson Fresh, a unit of third-party logistics firm CH Robinson, which will be the distributor of lettuce and microgreens to local retailers such as Lunds and Byerly's, Kowalski's and some Hy-vee stores.
Living Greens uses an "aeroponic," vertically stacked system that it says uses far less water less resources, is disease resistant and grows faster without herbicides or pesticides and grows lettuce and herbs indoors in a nutrient-rich air-mist environment without soil.
Aeroponics isn't new but it's becoming economically viable and may revolutionize agriculture as the cost of traditional farming rises, according to the Minnesota Department of Trade and Economic Development. Virtually any seasonal crop can be grown, including potatoes, cranberries and cabbage.
Anderson said Living Greens can grow on one acre what traditional farms grow on 200 acres. The system uses 95 percent less water and fertilizer, reduces transportation costs and offers year-round production without the uses of pesticides. Plants grow twice as fast as they would in soil.
By supplying local customers, the days and miles in the supply chain is reduced while nutrients and quality increase, Living Greens contends.
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