Sprout Stack’s vertical farm delivers the best damn salad you’ve ever eaten
Hugh McGilligan wants you to eat a salad. He’s not your doctor and he’s not making a commentary on your weight. He is, however, proud of his product and he’s willing to put his money where his mouth is.
“I’ve actually offered a money back guarantee—paid for out of my own pocket—if people aren’t convinced that it’s the best damn salad they’ve ever eaten,” he told VENTURE.
What’s so unique about Sprout Stack, the company for which McGilligan serves as CEO, is it does its farming indoors in the Northern Beaches not far from the heart of Sydney. That best damn salad you’ve ever eaten was grown in a recycled shipping container. It’s Australia’s first and so far only commercial-scale vertical farm, and McGilligan is on a mission to show why Sprout Stack’s way is better than what farmers have been doing for thousands of years.
The No. 1 factor in produce is freshness. From the second a plant is plucked out of the ground, it’s a race against time before it goes bad. The sooner it’s eaten, the better it tastes.
“We are in-store within hours of harvest as opposed to within days of harvest, which is the case for our competitors,” McGilligan said.
Sydneysiders accustomed to getting their produce from Gippsland or the Lockyer Valley find Sprout Stack’s offering tastier, more vibrant, and with a better texture in addition to being more nutritious. They’re even willing to pay more for it.
So how does Sprout Stack do it?
With a controlled environment and a computer program named after a carnivorous plant. Drosera, Sprout Stack’s proprietary management system, provides “a perfect summer’s day to our plants 365 days a year” with “just the right amount of nutrients, just the right amount of hydration, and 16 hours of sunshine.”
Not only does this skirt the vagaries of weather, the controlled environment eliminates the need for agrichemicals and conserves resources. McGilligan estimates Sprout Stack use 2-5% the amount of water and 15-20% the amount of fertiliser that traditional farming does.
In a closed loop system, Sprout Stack delivers a hydroponic solution directly to the plants. Any unused solution is captured for the next cycle. What is used is transpired by the plants and a dehumidifying HVAC system captures it in a sump pump, delivers it to a water salvage system, sterilises it with UV light and puts it back into the farm.
“We’re using tens of litres of water per harvest as opposed to terralitres of water that a traditional farmer might use,” he said.
What’s more, Drosera tells McGilligan’s team when to plant varietals with varying growth cycles so they’re all ready on the same harvest day. By the next morning, they’re at the grocer’s ready for your lunch.
In addition to providing a salad as good as what you’d pull out of the garden—“actually, I’d say we’re even better than stuff you might pull out of the garden because in the garden you’re exposed to all sorts of nasty pathogens,” McGilligan said—Sprout Stack delivers on the consumer’s vision of locally produced, eco-conscious, community-orientated food.
“We have a company constitutional commitment to the triple bottom line” of profit, people, planet. Minimising resource input, waste, and carbon footprint are hallmarks of Sprout Stack’s operation. Not only does the controlled environment conserve resources, eliminating the need for plowing and tilling avoids carbon release and soil degradation. Growing so close to consumers cuts down drastically on shipping emissions.
McGilligan acknowledges the macro trends of population growth and attendant need for increased food production over the next few decades, but he sees Sprout Stack as providing for a much more specific need. “We cannot produce the amount of food we need to produce simply by throwing more resources into a system that is increasingly strained,” he said. “However, I don’t believe it’s a Malthusian crisis. We’ve faced Malthusian crises in the past, and we will solve these.”
The magic of Sprout Stack, and vertical farming in general, is not so much simply making more food, but making better quality food and doing it more efficiently.
“We need a revolution in the way we think about productivity,” he said.
Climate change in the form of droughts and bushfires has made it increasingly difficult for traditional farming to yield high volumes of quality produce and make good use of resources. It’s also, along with COVID-19, accelerated trends of consumers caring more about where their food is coming from, what goes into growing it, and how long the supply chain is that delivers it to their plates.
Growing Like a Weed
So, is Sprout Stack’s promise of sustainability and the best damn salad you’ve ever eaten resonating?
“We went through a very uncomfortable place when we went through the initial lockdown (last autumn). We lost all of our foodservice clients, and that was a real blow because foodservice clients were quite lucrative for us. However, what we lost in foodservice we gained triple-fold in our retail base,” McGilligan said. “The changes that COVID has forced on society has been very good for at least the principle of vertical farming.”
The company has thrived through massive disruption. It started as an equipment manufacturer, with the intent to sell the growing system and setup to a distributed network of client farmers. They figured the best way to market the system was to have a multimillion-dollar business growing salads with the system. There are four mixed salads available in stores, plus “a range of wheatgrass for the hippies.”
Sprout Stack is unique in Australia—“I don’t know whether this makes us particularly brilliant and prescient or somewhat stupid, I’m still trying to figure that out.”—and aims to corner the market on vertical farming. The focus now is dominating NSW from Newcastle to Bowral before expanding to Melbourne, Brisbane, and Perth in 2021.
“Frankly, by the time we’re going to Perth, it’s as easy and perhaps even easier and more economical to expand into Asia,” McGilligan said. “We’re overwhelmed with demand and currently closing a round of fundraising, looking for investors to maintain our momentum. We’ve tripled the business over the past year.”
Sprout Stack has also increased its efficiency, lowered the cost of goods sold, and derives a good gross margin from each harvest, paving the way for expansion.
As for that guarantee? So far, McGilligan’s money has stayed in his pocket.