Canadian vertical farming start-up Adapt AgTech has teamed up with Reef Technology to bring its shipping containers for growing mushrooms to major cities across the United States, starting with Austin.
Reef transforms urban real estate such as parking lots into mobility and logistics hubs and currently operates more than 8,000 locations in hundreds of cities. The partnership will help Adapt place its shipping containers a stone’s throw from customers like restaurants and supermarkets, without having to pay the astronomical rent of a downtown commercial or industrial space.
Adapt opened its first shipping container in Austin and began serving restaurants this week. Over the next few years, the startup plans to expand to more than 50 locations, including Boston, Chicago, San Francisco, Seattle, and Miami.
“Our model is to create hyper-local farms in densely populated urban areas to reduce the distance from farm to fork,” Jonathan Murray, CEO and founder of Adapt AgTech, told australiabusinessblog.com.
Adapt’s network of shipping container farms specializes in “off-label gourmet mushrooms,” gourmet mushrooms that until recently were not available in retail stores in North America. Think pink, yellow, blue and king oysters, chestnut mushrooms and the trending lion’s mane.
“Mushrooms are very suitable for container growing compared to other crops such as leafy greens because of their energy consumption,” Murray continues. “They don’t need a lot of light. It’s really just temperature and humidity.”
Adapt, which launched in February 2022, delivered its first farm at a Toronto location last June. The company has grown since then and now has farms in Ottawa, Vancouver, Halifax, Kingston and Austin. On Feb. 17, Adapt says it will launch a partnership with Loblaws — Canada’s largest retailer — starting with two flagship stores in downtown Toronto, then dozens more in Toronto and Ottawa before expanding elsewhere in the following months.
Adapt will also be rolled out in 2023 with retail expressions under Canadian supermarket chains Sobeys and Pattison Food Group.
“By the end of 2023, we will be available in the stores of at least three of the five largest retailers in Canada, from Halifax to Vancouver and in between, representing more than 3,500 stores,” said Murray.
Adapt recently closed a seed round with Climate VC Congruent and will use the funds to expand its base and take on more support.
Sustainable fruiting, cheaper mushrooms
Adapt AgTech designs and manufactures its shipping containers in Delta, British Columbia. In addition to the five containers currently in use, Adapt has recently begun production of an additional 16 units and aims to deploy more than 25 units over the next 12 months. Some of Adapt’s shipping containers are solar-powered with backup plugs, but with a view to a quick launch in the US, the startup will plug its shipping containers into the power grid. Energy use, Murray said, is low — about 10 kilowatt-hours per day.
The company’s distribution model is similar to a hub and spoke. Adapt uses a centralized hub in Kingston, Ontario, to do all the lab work and colonize the substrate blocks. The startup then sends the blocks to sea containers, where the mushrooms can fruit close to customers. Murray says this allows Adapt to deliver mushrooms within a few hours of harvest, which means not only fresher mushrooms, but longer lasting mushrooms and less spoilage.
The startup deploys and operates the containers and also fulfills orders. An operator oversees everything from harvesting to managing orders to delivering mushrooms.
“All of our containers currently work primarily with one full-time farmer, so we’re empowering them to become what we like to call ‘farm entrepreneurs,'” Murray said. “So unlimited commissions, grow your territory as big as possible. We add containers, we grow your territories. This also allows us to bring new and young people into farming, which is exciting.”
Murray also noted that existing mushroom farm operators have contacted Adapt to convert their home businesses into Adapt farms.
Throughout the process, the startup can remain vertically integrated and thus save money on materials such as substrate, which Adapt itself makes from what is locally available. Adapt’s control of each farm also allows the company to monitor high yielding mushroom varieties and propagate more of them, giving the company even healthier margins and a high quality product that is less expensive than what you would get at the farmer’s market. get, Murray said.