Running a for-profit business with a not-for-profit mission

Running a for-profit business with a not-for-profit mission

Running a for-profit business with a not-for-profit mission 150 150 Stein

Vertical Harvest is using controlled environment agriculture to give people with disabilities the opportunity to improve their livelihoods along with the sustainability and economies of their communities.

Jackson, Wyo., might not be the first place you think of when it comes to innovation in controlled environment agriculture. Vertical Harvest, which began operating in 2016, produces leafy greens, tomatoes and microgreens in a 13,500-square-foot vertical greenhouse.

“From the beginning Vertical Harvest set out to create a model that could leverage the greatest impact in communities,” said Nona Yehia, co-founder and CEO. “We are a model that is setting forth to cultivate healthy people, communities and economies. It is through that understanding that all those things are linked to create sustainable communities. We know that successful communities are sustainable communities.”

Yehia said Vertical Harvest was born out of two critical needs in her community.

Nona Yehia, co-founder and CEO at Vertical Harvest, said her company is a model that aims
to cultivate healthy people, communities and economies.

Photos courtesy of Vertical Harvest

“Number one was that we import the vast majority of food that we eat,” she said. “By the time it arrives, it’s not that great to eat. Number two is that Jackson is a burgeoning local community, but it has never been a place that has been known to build careers. People come here to ski and party and then they leave. Business owners were having a really hard time keeping consistent employees, making it really hard to run a business.”

Creating a diverse, inclusive and profitable workplace

One of the things most unique and innovative about Vertical Harvest is the workforce it employs.

“What was really important to me and to company co-founder Caroline Croft Estay was that Vertical Harvest would provide a place where underemployed populations could feel that they were contributing in a profitable environment,” Yehia said. “By employing people with physical and intellectual disabilities we were exposing peoples’ abilities rather than focusing on their disabilities. We were creating an employment bank that was actually beneficial to the bottom line. This was a big part of why we wanted to be a for-profit organization as well.”

From the beginning Vertical Harvest was set up as a L3C or a benefit corporate model.

By employing people with physical and intellectual disabilities, Vertical Harvest has developed a workforce that is beneficial to the company’s bottom line.

“We wanted Vertical Harvest to be a scalable, replicable model that doesn’t have to be supported by a charitable or philanthropic organization,” Yehia said. “We wanted it to be a model that could be a part of the civic infrastructure and could perpetuate its own growth. The scalability and replicability of Vertical Harvest was why we chose the L3C model.”

Croft Estay was an employment facilitator trying to find consistent, meaningful work for her clients with physical and intellectual disabilities.

“These were people who grew up in the community, who wanted to contribute to their community and wanted to find consistent meaningful work,” Yehia said. “This is where we put food and jobs together in this vertical capacity. From the beginning we were targeting a common problem that businesses undergo in our community.

“Right from the outset other business owners were saying they were having this problem and they saw that Vertical Harvest was not. They asked us to help them. There is not only support for the individuals with disabilities, but there is support for the whole employee team to create a diverse inclusive workplace. The most valuable thing that we have built out of this commitment is our culture. We all know that businesses live or die on the quality of the culture that they have built. It is one of the most amazing things that we have built through this commitment to diversity and inclusion.”

Vertical Harvest, which initially built a 13,500-square-foot vertical greenhouse (shown) to
produce leafy greens, tomatoes and microgreens, is planning to expand with a 50,000-square-
foot prototype.

Developing a premium brand

Arik Griffin, who is Vertical Harvest’s chief financial officer, said one of the things the company has discovered is that part of the power of Vertical Harvest’s brand is the humanitarian good it is doing.

“People want to support us and buy our products,” Griffin said. “The restaurants and grocery stores like us for our quality and for the humanitarian message that they can get behind as do the consumers in the market place. People love our quality and they love our message. That translates into a brand premium.”

Yehia said it also helps that more people want to know where their food is coming from.

“Everybody has someone they know or a family who has a disability and the struggles that person goes through,” she said. “The reason that I am so passionate about this project is because I have a brother with a disability. At a very young age I realized he wasn’t going to have the same opportunities that I was going to have to create a career. That really resonates with people.

Vertical Harvest has expanded its customer base for its leafy greens, tomatoes and microgreens from Wyoming to include Montano and Idaho.

“We are creating opportunities and we have created an employment model where we bring out the abilities and it changes perceptions of what people are able to do. That creates a foundation of trust and strength with the community that really resonates with people, especially right now. It is what businesses can do. There is a real reward in benefitting people outside of your own stakeholder groups. This is something that is going to become more attractive as we move into 2021 and beyond.”

Unlimited expansion

Yehia has no doubt that the model Vertical Harvest has created can be profitable.

“Our incubator farm in Jackson will achieve profitability next year,” she said. “Vertical Harvest’s position in the industry is unique. There are a lot of these farms that have not succeeded. We have created a group of stakeholders who are committed to seeing Vertical Harvest and its prototype achieve profitability.

“Our two biggest hurdles that we learned are the production facility was too small to start out with and our market is too small. Jackson is a seasonal market. It is a smaller market than what our production system can produce in order to be profitable. We’ve expanded our customer base to include Montano and Idaho.

Arik Griffin, chief financial officer at Vertical Harvest, said part of the power of the company’s brand is the humanitarian good it is doing, which has been supported by its customers and consumers.

“We have worked very hard to understand the right crop mix, the correct market size and the correct farm size that can create a return that would be attractive to social impact investors. We have created a 50,000-square-foot prototype that when placed in the right markets will succeed and that will occur quickly. We knew that we could take what we’ve learned from our successes as well as our failures to create this model that fits within the objectives of social impact finance.”

Vertical Harvest is looking at building five new greenhouses in the next five years. Its next project will be built in Westbrook, Maine, in 2021 with crop production expected to begin the following year.

“We want to bring this model to every community that we possibly can within the country and internationally,” Griffin said. “We have as our mission providing good food and good jobs to local communities. Another piece of our mission is to spread that out, to bring it to as many people as possible. We’re in the first stage of our Series A capital raise. We are raising funds in order to provide the infrastructure at the corporate level so that we can expand.

“The other thing we need to achieve this is hearing from communities and finding local stakeholders who want to do impact investing and make a difference in their communities. Bringing together the people who want to make a difference. We also need to make sure we are constantly in touch with experts in the CEA industry trying to nurture our relationships with the very best people.”

For more: Vertical Harvest, (307) 201-4452; info@verticalharvestfarms.com; https://verticalharvestfarms.com/.

This article is property of Urban Ag News and was written by David Kuack, a freelance technical writer in Fort Worth, Texas.

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