# Bowery Farming (2015 – 2024)

- URL: https://girisimcikafasi.com/en/startup-graveyard/bowery-farming/
- Sector: Food and drink
- Country: United States
- Total funding: $472 million
- Cause of closure: Business model failed

## What did it do?

Bowery Farming was a New York-based company that grew lettuce, leafy greens and herbs without pesticides using vertical farming in industrial warehouses in New Jersey, Maryland and Pennsylvania. It monitored its plants continuously with sensors, robots and its own software, BoweryOS. It sold its produce to chains such as Whole Foods and Walmart and to various food delivery companies.

## Why did it shut down?

Although the company raised $472 million and reached a valuation of $2.3 billion, its produce remained expensive and demand for it was weak. A plant disease that spread through several facilities caused serious crop losses. According to PitchBook, acquisition talks that might have saved the company also came to nothing. In November 2024 Bowery ceased operations and laid off staff at its facilities in three states.

## The story

In May 2021 a New York-based vertical farming company closed a $300 million funding round, with celebrity investors ranging from Natalie Portman to Justin Timberlake, and reached a valuation of $2.3 billion. A lettuce-growing start-up joining the ranks of billion-dollar companies marked the peak of optimism about agricultural technology. Three and a half years later the same company had closed its doors.

Bowery Farming was founded in 2015 by Irving Fain, who had previously sold CrowdTwist, a company he co-founded, to Oracle for $100 million; David Golden and Brian Falther joined as co-founders. The company turned industrial warehouses into multi-storey farms. Thanks to sensors, robots and BoweryOS, which photographed the plants and analysed the data in real time, lettuce, leafy greens and herbs were grown without pesticides and with little water. Commercial farms opened in New Jersey, Maryland and Pennsylvania, a plant science centre called Farm X was set up in Kearny in 2021, and its produce reached more than 850 points of sale, led by Whole Foods, Walmart and Albertsons stores. A total of $472 million was raised from funds such as GV, General Catalyst, GGV Capital and Temasek; the final round, in 2021, was led by Fidelity.

Indoor farming, however, was expensive, and the produce on the shelves stayed expensive too. Demand at those prices was weak. On top of that, a plant disease that spread through several facilities cut harvests sharply. According to PitchBook, when acquisition talks that came to nothing were added to this leaf-destroying pathogen, the company's routes to survival closed off.

In November 2024 Bowery ceased operations and laid off staff at its facilities in New Jersey, Pennsylvania and Maryland. When it closed, it was known as the largest vertical farming operation in the US.

The lesson from Bowery is that a technologically impressive production method also has to stand up economically. Software and robotics may have raised yields, but the cost of growing indoors could not be squeezed into the shelf price of ordinary greens; and a single disease outbreak wiped out an already thin margin entirely.

## Lessons

- In an energy- and equipment-intensive production model, do not expand capacity before your unit cost gets close to the shelf price of the competing product.
- Do not roll out nationally before testing in a single city how much of a price premium a message such as 'pesticide-free and local' actually earns from customers.
- If you grow a single type of crop indoors, one disease can hit every facility at once; prepare isolation between sites and a contingency plan.

## Sources

- [Bowery Farming](https://en.wikipedia.org/wiki/Bowery_Farming)
- [Vertical farming "unicorn" Bowery to shut down](https://www.axios.com/2024/11/05/bowery-vertical-farming-close)
- [Wilted greens: How a leaf-eating pathogen, failed deals brought down Bowery Farming](https://pitchbook.com/news/articles/bowery-farming-collapse-leaf-eating-pathogen-failed-acquisition)