Controlled Environment Agriculture: Opportunities and Challenges for Investors
Controlled Environment Agriculture (CEA): a few years ago, Vertical Farms was one of the hottest segments for food & ag venture investors. Companies like Bowery Farms and AeroFarms closed late-stage growth rounds with hundreds of millions of dollars of VC funding, AppHarvest went public at $1bn+ valuation via a SPAC merger, and global scale seemed all but inevitable for the segments’ leaders. However, as inflation and interest rates rose in 2022 and 2023, investors turned away from the sector, and companies began to struggle and even go bankrupt. The narrative shifted. Now, profitability is at the top of investors’ minds, not growth, and questions remain about the fundamental viability of the space. We dug into the segment to understand where value might lie today.