Robotic vertical farming startup Fifth Season shuts down

US vertical farming startup Fifth Season has shut down its operations. Pittsburgh Enterprise Occasions was first to report the information.

Sources aware of the matter stated Pittsburgh, Pennsylvania-based Fifth Season closed its doorways final Friday. The corporate was recognized for its vertical farming services that used robotics to develop leafy greens indoors.

The shutdown additionally spells the tip of a pricy enlargement the corporate was planning for Columbus, Ohio subsequent 12 months. 

Why it issues:

Fifth Season’s seemingly abrupt closure is probably going not the final we’ll see for this sector.

Managed setting agriculture — and vertical farming particularly — has lengthy been the topic of a lot hype and promise. However thus far, there’s little or no public knowledge round what works and what doesn’t when it comes to effectivity and return on funding.

Giant farming services are extraordinarily capital intensive. CNBC recently called out Fifth Season’s Ohio facility that was deliberate for 2023. The 180,000-square-foot vertical farm would require a $70 million expenditure — or roughly $17 million per acre. And whereas demand for domestically grown, pesticide-free meals is rising, it’s generally not sufficient to offset the price of working these high-tech operations.

Fifth Season’s closure follows information from earlier this 12 months of French startup Agrocool’s placement into receivership. On the finish of 2021, AeroFarms scrapped plans to go public through SPAC. Simply this week, Netherlands-based Glowfarms ceased all activity after failure to seek out ample funds.

All this implies that vertical farming is at, or no less than very near, the “trough of disillusionment” it’s been heading in direction of for months. That is the point in the Gartner Hype Cycle the place, in accordance with the analysis agency, “Curiosity wanes as experiments and implementations fail to ship. Producers of the expertise shake out or fail. Investments proceed provided that the surviving suppliers enhance their merchandise to the satisfaction of early adopters.

As Henry Gordon Smith recently wrote on AFN, “What comes subsequent is a interval of melancholy and correction.”

Current shutdowns like Fifth Season’s don’t spell the tip for vertical farming. Relatively, they mark the start of a interval of trustworthy dialogue of what does and doesn’t work and, hopefully, extra life like expectations. The vertical farming business simply may lose a number of extra startups within the course of.

What they’re saying:

Maybe the most effective indicator of what occurred at Fifth Season and whether or not robotic vertical farming has a future will be gleaned from former workers. A number of took to LinkedIn this week to specific their ideas:

• “Sadly, this journey is ending with Fifth Season closing its doorways attributable to this difficult macroeconomic setting,” stated one senior meals developer. 
• A software program engineer wrote that, “Sadly, generally the timing is simply incorrect and recessions hit firms in another way. Fifth Season might be shuttering its doorways as of at present and my coronary heart is damaged for the lack of potential, however I’m excited for my subsequent chapter.”
• Lastly, a precept software program engineer wrote, “I nonetheless consider in our imaginative and prescient. Temporal downturns could have [a]ffected us, however I consider it is going to be a realized answer in some unspecified time in the future sooner or later.”