Infarm looks to raise $200m for vertical farm expansion

Infarm, a German start-up developing indoor farms, is closing in on a new $200m investment, hoping to capitalise on renewed investor appetite for companies that can address food supply problems that arose during the pandemic.

Berlin-based Infarm has closed an initial $140m of a planned $200m Series C funding round, said people involved in the deal, at more than double the valuation at which it raised $100m a year ago. The deal values the company in the hundreds of millions of dollars, these people said.

Unlike other vertical farming ventures that install crops in huge warehouses, Infarm’s smaller “modular” units sit on supermarket aisles and inside restaurants. These hydroponic farms can avoid the use of pesticides thanks to a tightly controlled environment, and reduce lengthy supply chains by offering produce that is fresh at the point of sale.

Hundreds of its small farms growing herbs and salads can be found on the shelves of supermarkets after it struck deals with Marks and Spencer in the UK and Kroger in the US, as well as European supermarkets including Metro, Casino and Migros. Last month it signed up Aldi in Germany.

LGT Lightstone, the “impact investing” arm of the Princely House of Liechtenstein, is said to be among Infarm’s new investors, joining venture capitalists including Atomico, Balderton, TriplePoint, Cherry Ventures and LocalGlobe. LGT Lightstone is also an investor in Lilium, the German air-taxi developer.

Infarm’s modular units sit on supermarket aisles and inside restaurants © Simone M.Neumann –

“Vertical farming is a pandemic-proof business,” said one investor.

Infarm declined to comment. LGT Lightstone did not immediately respond to a request for comment.

But while the Covid-19 pandemic’s pressures on food supply chains have opened opportunities for new producers such as Infarm, it has also hit demand from restaurants, which make up a smaller portion of the company’s business.

While tech investing has continued during the pandemic, lockdowns make it harder for potential investors to perform due diligence on hardware-based companies such as Infarm.

The company was founded in 2013 by Osnat Michaeli and brothers Erez and Guy Galonska. It competes with several other venture-backed indoor farming start-ups including Plenty, Bowery Farming and AeroFarms.

The group was founded in 2013 by Osnat Michaeli, pictured, along with brothers Erez and Guy Galonska © Simone M.Neumann –

Bowery has raised more than $140m from investors including Alphabet’s GV, according to Crunchbase, while SoftBank-backed Plenty has a $400m war chest.

Infarm’s latest fundraising, when complete, would allow it to close the gap with Plenty, which also counts Amazon founder Jeff Bezos and former Google chief Eric Schmidt among its investors. In late March, Bloomberg reported that Plenty was looking to raise at least $100m in new financing.

However, Infarm’s expansion has outpaced Plenty, which remains largely focused on building facilities in its native California.

While larger warehouses such as Plenty’s have high upfront costs and are expensive to provide with lighting and air conditioning, Infarm argues its modular farms are easier to scale and prove appealing to retailers looking for differentiation. Investors hope that it can also build a brand of its own, unlike most agricultural suppliers.

Additional reporting by Emiko Terazono