Oishii’s latest funding round is announced, an indoor ag firm pivots to bitcoin mining and cannabis turns in a rough 3Q.

1. Oishii’s Latest Funding Round hits $150m

Oishii, a Jersey City-based vertical farming startup, has raised $150 million in Series B funding. The company, which specializes in growing berries and tomatoes using indoor farming techniques, initially announced a $134 million round in February, but increased it due to continued investor interest. New investors Resilience Reserve and Miyako Capital joined existing backers in the round. Oishii plans to use the funds to expand into new markets and invest in research and development.

The company recently launched its largest farm to date, a 237,000-square-foot facility in Phillipsburg, and has expanded its retail presence to include Harris Teeter locations in the Mid-Atlantic and Wakefern Food Corp. supermarkets in the Tri-State area. Additionally, Oishii plans to establish an R&D facility in the Tokyo metropolitan area by the end of 2025.  The company is part of a wave of “next gen” vertical farmers, using business models that go beyond “scaling leafy greens” to attract investors and customers.

Zordi gets funding of $250k from startup competition

Zordi, an agtech robotics startup, won a $500,000 prize at the recent GROW-NY competition. The company develops AI-powered robots for vertical farming operations. These robots are designed to perform tasks such as seeding, transplanting, and harvesting in indoor farming environments. 

Agrify secures additional funding

Agrify Corporation (Nasdaq: AGFY), a listed CEA equipment provider, announced a $25.9 million non-brokered private placement. The funding round was priced at $22.30 per share and was expected to close on November 21, 2024.  The proceeds will be used for general corporate purposes, including working capital and business development. As part of the transaction, Chairman and Interim CEO Ben Kovler purchased 10,000 shares at $38.76 per share. Prior to this, Agrify secured a convertible note financing of up to $20 million from cannabis CPG firm Green Thumb Industries, with an initial draw of $10 million on November 5, 2024.  Ben Kovler is also the CEO of Green Thumb Industries.

2. Two acquisitions and a pivot in November

Our Indoor Ag Buzz Index™ combines the popularity of a range of indoor farm-related phrases in the media into an index.   The index remained steady vs last month with a stream of incremental announcements in the month:

AgriForce acquires bitcoin mining firm for co-location

AgriFORCE Growing Systems Ltd., a company previously focused on agricultural technology, has announced a significant shift in its business model. The company has acquired Miner One Capital Corp., a Bitcoin mining operation, in an all-stock transaction. This acquisition marks AgriFORCE’s entry into the cryptocurrency mining sector, diversifying its operations beyond its original focus on controlled environment agriculture. As part of this transition, AgriFORCE plans to change its name to “Canndica Group Ltd.” to reflect its new direction. The company intends to leverage its expertise in facility design and operations to optimize the Bitcoin mining facilities. This strategic move represents a notable pivot for AgriFORCE, one of several firms looking to supplement CEA income with synergistic revenue streams.

Nebula acquires Delta 9

Nebula Group, a defense and development company specializing in emerging economies and leveraging small to mid-sized enterprises, has acquired the Delta 9 Grow Pod business from Delta 9 Cannabis Inc., a Canadian vertically integrated cannabis company. This acquisition has led to the formation of Nebula Grow, operating under “The Horticulture Company,” which aims to provide cultivation solutions for the controlled environment agriculture (CEA) market. Kelsey Friesen, former Director of Delta 9 Pods, has joined Nebula Grow as its Director. The new company plans to integrate the Grow Pod business into Nebula’s existing Climate Control Systems division, focusing on advanced grow pod solutions for ag applications, including vertical farming and urban agriculture.

Urban-gro adds cannabis business

urban-gro, Inc. (Nasdaq:UGRO), a Design-Build firm, has launched a new Processing and Extraction Division to expand its cannabis sector offerings. This strategic move focuses on post-harvest operations, providing integrated design, engineering, and construction services for extraction spaces, including C1D1/C1D2 hazardous environments and dry rooms. The company has hired a Business Development Director with eight years of experience in construction and post-processing to lead the division. 

3. 3Q Results Bifurcate, Cannabis Struggling, Produce Soaring

With November came the first wave of 3Q results, which confirmed what many suspected: cannabis is still a rough market, but those pivoting or refocusing on higher margin products are seeing results.

Here are the major trends we noted in the results:

• Focus on Proprietary Brands: Companies like Hydrofarm and GrowGeneration are emphasizing proprietary brands to improve margins and differentiate themselves in a competitive market. 
• Operational Efficiency: With a strong focus on cost management and operational efficiency, companies are reducing SG&A expenses and consolidating operations. For instance, GrowGeneration’s restructuring plan aims to cut expenses by approximately $12 million annually.
• Cannabis Market Challenges: Companies serving the cannabis industry are facing significant headwinds.  An oversupply in the cannabis market is leading to reduced demand for cultivation equipment and supplies. Hydrofarm reported a 13.7% decline in product volume/mix primarily due to this oversupply.  The oversupply is also causing downward pressure on prices. Hydrofarm noted a 4.9% decrease in prices contributing to their revenue decline.
• Strategic Pivots: In response to these challenges, companies are diversifying their product lines and exploring new market segments. For example, Edible Garden’s expansion into fresh produce production at its Michigan facility is a strategic shift.  Companies are investing in technology to improve efficiency and competitiveness. This includes implementing advanced greenhouse management systems and high-speed packing lines to optimize operations and reduce costs.

3Q Results in November

Stock Ticker	Company Name	Q3 2024 Revenue	Q2 2024 Revenue	Q3 2023 Revenue	% Change Q3 vs Q2 2024	% Change Q3 2024 vs Q3 2023
AGFY	Agrify Corporation	$1.9 million	$3.0 million	$3.1 million	-36.7%	-38.7%
EDBL	Edible Garden AG	$2.6 million	$2.1 million	$3.3 million	+23.8%	-21.2%
GRWG	GrowGeneration Corp.	$50.0 million	$53.5 million	$55.7 million	-6.5%	-10.2%
HYFM	Hydrofarm Holdings Group, Inc.	$44.0 million	$54.8 million	$54.2 million	-19.7%	-18.8%
IPW	iPower Inc.	$23.3 million	$19.0 million	$20.2 million	+22.6%	+15.3%
LOCL	Local Bounti	$10.2 million	$9.6 million	$6.8 million	+6.3%	+50.0%
VFF	Village Farms International	$83.4 million	$92.18 million	$69.5 million	-9.5%	+20.0%

Sources

iPower Reports Fiscal First Quarter 2025 Results

GrowGeneration Reports Second Quarter 2024 Financial Results

Hydrofarm Holdings Group Announces Third Quarter 2024 Results

Village Farms International Reports Third Quarter 2024 Financial Results

Agrify Corporation Announces Results for Third Quarter 2024

Edible Garden Announces Third Quarter 2024 Financial Results

Local Bounti Announces Third Quarter 2024 Financial Results

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Featured image courtesy of Unsplash.

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