An Infarm Growing Centre. Image credit: Infarm

Brief: Vertical farm network InFarm to lay off ‘more than half’ of workforce, downsize operations

November 29, 2022

  • Vertical farm startup Infarm will lay off more than half of its workforce, around 500 employees.
  • The Berlin, Germany-based startup cites skyrocketing energy prices and the wider downturn as reasons for the cuts.
  • Infarm will consolidate its large-scale vertical farms, called “Growing Centres,” in markets most likely to achieve profitability in the near term.

Why it matters:

In an email sent to employees, Infarm cites “escalating energy prices and tough financial markets” as reasons for widespread layoffs and an overall “strategy shift.”

“Energy prices have escalated (doubled across Europe), which puts a lot of additional pressure on our business and seriously impacts our cost of production in affected markets,” states the email. It also mentions supply chain issues and rising costs for materials. 

Since its founding in 2013, InFarm has cultivated an indoor farming system to grow produce in carefully controlled environments. To date, the startup has farms of various sizes in more than 1,800 retail stores across 11 countries. It has also raised $604.5 million from Qatar Investment Authority, Lightrock and others.

The company grows mainly leafy greens, though it recently said it had successfully trialed wheat indoors.

Now, Infarm says it is forecasting “slower growth caused by a significant downturn.”

To adjust, it will consolidate is Growing Centres in core markets of Frankfurt, Germany; Copenhagen, Denmark; and Toronto, Canada. Infarm says it can achieve profitability in these markets in 2023.

It will also open a Growing Centre in Baltimore, Maryland in the US.

Meanwhile, Infarm is considering downsizing operations in the UK, France and the Netherlands; operations in Japan are currently under review.

“We grew our teams to support a global growth strategy, but today, it is clear that a consolidation and focused growth mindset is required to overcome the challenges,” the company notes in its email.

Infarm is the latest indoor farming company to announce layoffs and/or shutdowns. Also in November, Netherlands-based Glowfarms ceased all activities, and US vertical farm Fifth Season shut down. Also this month, indoor farm robot startup Iron Ox laid off half its staff and Kentucky’s AppHarvest is running out of cash to fund its high-tech greenhouses.

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