26 Seasons’ capital raise comes up $1m short

Pickers harvesting strawberries at 26 Seasons' Foxton indoor farm. Photo / Supplied

Farming technology company 26 Seasons’ $5.5 million capital raise has come up about $1m short, but the strawberry grower says it has sufficient funds to start commercialising its vertical farming operation at Foxton in 2023.

Chief chief executive Grant Leach told the Herald the company had reached about 80 per cent of the fundraising target.

Leach expects to make up the shortfall after Christmas.

“The line of demarcation was to reach 70 per cent to commence commercialisation within New Zealand, and we have achieved that, which has been really good,” Leach said.

The capital raised would fund capital expenditure and a small portion would go towards operational expenses involved in the scaling up of the Foxton site next year.

Leach said 26 Season expects to have strawberries in supermarkets by April next year - picked in the morning and on the shelves by the afternoon.

He blamed the economy for the capital raise coming up short.

“I think the current economic climate probably caused it to slow down a little in terms of folks just being a little more cautious in their approach, and were probably just drawing out the due diligence process a bit longer,” he said.

“Those who have shown keenness have come over the line - predominantly high net worth individuals with a couple of institutions.”

Funding was primarily for growing strawberries but with some money allocated for research and development in other berry varieties.

The company expects to grow strawberries from April to October, before the local season kicks in.

Leach said the company’s main competition would come from imported strawberries, and not locally grown fruit.

He said three major supermarket chains had shown support for the product.

The company was co-founded by current Delegat Group chief executive and former Landcorp chief executive Steve Carden.

It uses hydroponics to grow strawberries indoors in five-layer stacks that can reach an average 3.5m in height.

The company says its strawberries are sustainably grown in its indoor vertical farm, a former industrial site converted into a productive indoor vertical strawberry farm that mimics perfect strawberry growing conditions.

Leach said indoor vertical farming is attracting attention globally for its ability to sustainably grow food anywhere while eliminating external factors like seasons, climate, severe weather and global events that threaten crops and disrupt food supply chains.

The company this year supplied its first crop to select retailers in one of the wettest winters on record.

At Foxton, 26 Seasons has a 1,350sq m industrial site capable of producing a million punnets of strawberries annually.

The controlled indoor environment removes external factors like weather, seasonality, pests and disease and mimics perfect strawberry growing conditions 24 hours a day.

The company began in 2017 with an indoor vertical farm in a former Wellington nightclub and expanded last year to include microgreens - young seedlings of edible vegetables and herbs - in a converted warehouse in Penrose.

Leach says 26 Seasons strawberries are grown under a proprietary, high-tech lighting system in vertically stacked beds.

The company says that unlike other Controlled Environment Agriculture (CEA) operations, 26 Seasons’ is comparatively modest in terms of capital investment required and provides excellent returns in a relatively short period of time.