The Dutch branch of vertical farming startup Infarm, best known for its global network of modular container farms, has been “declared bankrupt” according to official documents.
Infarm says the bankruptcy is not impacting its current restructure in which the company is focusing on markets where profitability is likely attainable.
Multiple industry sources say Infarm has raised $40 million – $50 million in new funds from Qatar.
Update: A spokesperson for Infarm told AgFunderNews that the company “won’t be making any comments on the rumors” around the possible new funding.
Previously:
Signs of trouble first cropped up for Infarm at the end of 2022, when the company laid off more than half its staff in an effort to “downsize” operations.
The company, which grows leafy greens in vertical farm environments, closed operations in Denmark, the UK, France, the Netherlands and Germany earlier this year, completely exiting the Europe market in the process.
Infarm has raised over $600 million in total from investors including Astanor Ventures, Lightrock and the Qatar Investment Authority.
Why it matters:
Infarm’s Dutch branch bankruptcy is the latest in a string of them for indoor crop farming companies. Vertical mega-farming companies AeroFarms, Kalera, and greenhouse grower AppHarvest all filed for Chapter 11 bankruptcy protection this year in the US. (AeroFarms has since emerged from bankruptcy and says it is nearing profitability.)
A tough macroeconomic environment, failure to deliver on the promise of large-scale indoor crop farming, and cooling investor sentiment are just a few among the litany of reasons these companies are struggling to stay afloat.
Like AeroFarms et. al., Infarm has also had to grapple with high energy prices, which have impacted the company’s margins, according to Sifted, which broke the news of the Dutch branch bankruptcy. Vertical farms are typically powered by LED lighting, temperature control systems and air control/flow systems, all of which require capital-intensive energy (and fossil fuels).
Sifted speculated that Infarm “may seek to move to Qatar,” which is rich in renewable energy sources such as solar.
A twist?
Industry sources have informed AgFunderNews that, in addition to a potential move to Qatar, Infarm has taken $40 million – $50 million from the Qatar Investment Authority.
AgFunderNews has reached out to Infarm to confirm this and will update this post with further details as they arise.
What they’re saying:
Infarm’s Toronto, Canada farm will continue “unaffected,” according to the company.
“We are focusing on Growing Centres where we have a clear path to profitability in 2023 and consolidating those where this cannot be achieved in the near term,” the company said at the time of its departure from Europe.
“The core trading operations, including our farm in Toronto, are not impacted by the group restructuring. This restructuring is aimed at bolstering the business for the future and we will be sharing some exciting updates on these developments very soon,” an Infarm spokesperson told AgFunderNews this week.
