In this episode, our guest is David Farquhar, CEO of IGS. IGS is an agritech business that started in 2013, revolutionising the indoor growing market. David joined the team in November 2017 and successfully raised a £7 million series A funding round and total investment to date of £13.8 million. Now, IGS are looking towards global expansion. David will tell us more about the patented technology IGS have created - their TCEA total controlled environment agriculture platform and the Intelligent Grid technology to control environmental elements, including lighting, watering, CO2 levels and nutrient delivery whilst benefitting from significant gains in controls and cost reductions.
Tune in to hear about these cutting-edge technology platforms creating ideal climates for plants and people, here's the conversation between Rob and David.
Learn more about IGS: https://www.intelligentgrowthsolutions.com/
Follow David on Linkedin: https://www.linkedin.com/in/davidgfarquhar/
Hi, welcome to the Forward Food Tech podcast where we explore the future of food and agriculture with the people who are taking us there. In this episode, our guest is David Farquhar, CEO of IGS. IGS is an agritech business that started in 2013, revolutionising the indoor growing market. David joined the team in November 2017 and successfully raised a 7 million series A funding round and total investment to date of 13.8 million. Now, IGS are looking towards global expansion. David will tell us more about the patented technology IGS have created - their TCEA total controlled environment agriculture platform and the Intelligent Grid technology to control environmental elements, including lighting, watering, CO2 levels and nutrient delivery whilst benefitting from significant gains in controls and cost reductions. Tune in to hear about this cutting-egde technology platforms creating ideal climates for plants and people, here's the conversation between Rob and David. David, I'd like to welcome you to the Forward Food Tech podcast, really excited to have you on board because this is the first podcast where we're identifying and dealing with the topic of vertical farming and its potential for the future. Just quickly introduce iags and how long you've been doing this and where you're going with it now. Yeah, thanks, Rob. I'm very happy to be here. So IGS is an eight-year-old company founded by a real farmer up in Aberdeenshire, he was growing microgreens and high end veg, sort of baby vege in poly tunnels and wanted to do that 12 months of the year. Perfectly feasible up there because of the very long summer days, and actually it's a lot a lot of sunshine, great in the summer, but in the winter, absolutely impossible. So the need was to find a way of delivering supplementary lighting. Most crops will take up to 18 hours a day, if you think about the length of a summer day during in a temperate climate, during the growing season. And so in theory, you can deliver 18 hour days, 12 months of the year, 365 days of the year. So what Henry wanted to do was to see if he could provide that supplementary lighting perhaps along with some monitoring and some climate control. And it just so happened that an American professor, who was at the time at St. Andrews University had invented the LED light back in the day and Henry teamed up with him, John Allen. And together they proved on something the size of your desk that yes, indeed you could grow crops or cause them to grow using manipulated LED light. And the whole story kind of went from there. The business spent five years in stealth mode, I joined late '17, barely '18. Since when we have raised our series A finance from three of the biggest agri tech investors in the world plus the Scottish Investment Bank. We've put a team in place, a world-class management team in place began to really expand the crop range. And we went from zero sales to annualised 35 million in the second half of last year. So we're very excited. We're now shipping systems around the world as far afield as Australia and commissioning them and supporting our farmers. Wow, that's an incredible lift off there, you must be really pleased. What is the big difference that ICS has over the other guys in this sector? Well, first of all, our strategic position is to be a tech provider, the old American analogy that the guys who provided the picks and shovels made more money from the Gold Rush than the miners did, whether we'll make more money than our farmers is very unlikely. But we certainly aim to be the providers of those best tools. And so that's a deliberate position, unlike quite a lot of the well known brands you will have seen who are trying to build their own farms and go around the world and grow stuff. Our belief is that the Western world didn't even invent agriculture. It was invented between the Tigris and the Euphrates. So who are we to tell those people want to grow or how to grow it? And so our job is to simply empower and enable local farmers around the world who may have national or city or regional ambitions and provide them with those tools. What makes our system different is we've cracked the three really thorny problems. Number one, how do you power hundreds of 1000s of LED lights in a way that is first of all energy efficient, but secondly gives you precision of control which will enable you to create any spectrum. So in other words to be able to mimic real light wherever the crop you're growing would naturally find its summer. And so therefore, you got to be able to do things like pulsing dimming beam angle, spectrum, brightness, all of these things and you have to be able to create your mimica diurnal range. And you have to be able to mimic the growing season because what the crop needs when you're germinating, the seed is not the same thing that it needs when you're hardening off at the end. So that's the first one, the efficient and precise control and delivery of light. The second one is, as well as having hundreds of 1000s of LEDs, you've also got at least 10s of 1000s of living, breathing plants. So you're putting these organisms in a metal box, and that's always going to be a clash. So ventilation is a huge challenge. The crops will take in carbon, they'll take in water, they'll take in nutrients, and what they will push out is hot, humid, oxygen, you don't want any of those things. So managing the near-field ventilation on the level of something like a growing tree is enormously important to deliver the right sort of wind if you like ventilation to the crop. But then secondly, you've got to get rid of that unwanted hot humid oxygen afterwards, because that's just going to drain all the plants around, the ones that are transpiring. So background ventilation, and foreground ventilation, massive problem, which we've cracked and patented, like the controls on the lights. And then the third one is you couldn't get the human beings out. So all these pictures that we see of people wearing white lab coats, a hairnet, a pair of goggles and carrying a clipboard. That's a super piece of technology is the clipboard, you know, poking the crops, and sticking their noses into them breathing on them, bringing in pest and disease. No, wrong thing to do. Artificial intelligence, if you tell it what the correct weather recipe is, it will deliver exactly that using this machine. What do you need human beings for? Nothing. And as somebody that I've come from the field scale strawberry industry, particularly polytunnels and tabletop, I'm really interested to hear that you've developed technologies there that I guess that we've been trying to deal with, as an industry for decades. And because you're investing in and solving problems that I guess weren't there in the first place until you started doing what you just said, plants in a box, you've then created solutions for other crops. So before we dive into that, I just want to challenge you for a second, I understand it's close now to $2 billion has been invested in this industry of yours, the vertical farming industry with some headline people from IKEA to Google, to these celebrities to you name it. There's been a vast range of people that have believed in this industry. And yet, I just got a quote from Dr. Paul Kathie, I think I hopefully I pronounced that correctly. He's a plant physiologist, and especially the vertical farming. And his words are 'you can't fit the planet with lettuce alone'.I just wonder with all this pursuit of essentially, largely the cropping does tend to be a leafy lettuce, that does tend to be high value, arguably, some could say expensive. And they might be okay in your pseudo kitchens and fancy restaurants. But does that feed the planet? So help explain to me and then the normal human beings out there that hear about all this investment going to vertical farming on how we're going to feed the planet? Yeah, and it's absolutely appropriate question. The first thing I will say is that there is far too much hype, most of it actually bs and some of it just straight lies talked to by this industry. The industry is in great danger of tripping itself up. I saw someone's video the other day claiming they had a 100% closed loop or recycled irrigation system that is impossible because the crop is 95% water. So what happens to the water that the crop takes up? Are they telling me they're extracting it back out? And they're selling dried herbs or something? It's just nonsense. So the first thing to say is that if you take the crossroads between feed the world and climate change, which really are the two big things that I believe we can help contribute to, vertical farming will be part of the answer. A good example is the Singapore '30 by 30 Food Strategy'. So they want to grow 30% of their crops in Singapore by 2030. They have described the diet which is 50% fruit and veg, 25% protein and 25% staples. So obviously we can grow the fruit and veg or some of it, their belief is that they will be able to do 20% of fruit and veg and 10% of protein and that will become their 30%. So I would say that vertical farming, once it matures, we'll probably be able to supply somewhere between 20% and 25% of the diet in terms of the number of varieties. It then becomes a question of how much of those varieties people consume in different parts of the world. We'll also be able to help with climate change, but we're not going to solve that on our own either. So let's get real about it. So that I think it's very important to have That dose of realism. When you look at the economics, one of the big American systems, we saw some of their numbers recently, and they grow big warehouses mostly full of kale and their prices are sort of $13 to $15 a pound to produce kale. I don't understand how you're ever going to make any money doing that if people do talk about leafy greens a lot. So let's just take one example, Basil is roughly 40% of world hair production because of the popularity of Italian cuisine. If I go to my local supermarket, I'll get a 30 gram little cellophane pack. And that would equate to about 30 to 35 a kilo, depending on the season. The wholesale price in the Spittlefields market in London is 28 for organic and 20 for non-organic, our farm gate cost of production is 2.70. So from an economic point of view, we can make our farmers extremely competitive. But the good news is we've gone way beyond those leafy greens. So we're doing things like started plants for tomatoes and strawberries to go out into poly tunnels we've done brassicas, such as broccoli, we've just harvested six varieties of seed potato, all absolutely perfect. And the great news is that instead of taking the growing season to go from a stem to a baby tuber the size of your pinky fingernail, and then cold storing it over the winter, and then putting it planting it out to grow the seed potato in another season. So a total of 18 months, we got there without having to replant a thing, in 75 days. So it's incredibly quick by comparison. And we've done carrot, we've done celery, we've done radish, we've done baby turnips, all sorts of things. So roots, fruits and leafy greens. That's, that's a big difference. You gave some cost there for your basil, I was looking at the numbers from other vertical farms, they wouldn't be close to that, would they? We haven't seen anything that's close to it, because the yields are not great, they're not very efficient. And they haven't cracked those three big things. The labour, the energy and the ventilation. A lot of people talking about it. But I haven't seen any evidence of it yet. But I'm sure there'll be some comments on this , so we'll see. So these other areas, I'm particularly interested as somebody that 's in strawberries, we had a massive problem with Phytophthora. I know you and I have had previous conversations about this and understand nematodes and potatoes, particularly certainly at the seed industry. And it seemed that sto ome extent farmers are expected to actually accept a level of pathogens or basically unhelpful diseases. It's just part of the process of buying their plant project. And I guess what you're talking about there, reading through the lines is a totally biassed secure environment. That's correct. I mean, the stats that I heard about the strawberry industry in the UK, the startup plants, I believe, mostly come from the continent or North Africa, and something like 35% to 40% of them are never planted because they're diseased or damaged, or they've got bugs on them or whatever. And my understanding is that cost the industry about 12 million a year, just in that. And we've seen similar things that you mentioned nematodes with a seed potato. Yeah, absolutely. But the guys we've worked with on the on the broccoli, they bring up a 100 million starter plants from Lincolnshire in Lancashire every year. And the building of a vertical farm to grow their starters will justify itself just by reducing the transport costs alone. And the other great thing about it is it normally takes six weeks to get to about a six inch plant that you can put out. Ours takes about 11 days. So it's very, very quick. And that's when you start to see the productivity gains that a plant breeders only could have dream in the middle of the night previously. So talk about the wider industry because I understand that you invented a new system to transport your electricity within your vertical farm system. I know your current system is selling incredibly well around the world from what you said already. But then I understand you've got this system, which I think you called the Grid that has transformed how you can circulate power. Can you talk more about that and the other ways of potentially affecting what I understand is called horizontal glass, horizontal farming, which to me is glass and poly. But why do you think that's an opportunity for that industry? So going back to the start of my story. So Henry Aykroyd, our founder, was doing just that up in Aberdeenshire. And he was looking for something that would provide this supplementary lighting. So the obvious thing to do would be to create something you could suspend from the ceiling of a greenhouse or glass house or a polytunnel. And so that's exactly what was created. Rather than using copper cabling and things like cable trays, which are obviously heavy and will drag and and they're very expensive. We invented a system or rather our co-founder Dave Scott invented a system which uses the sort of transformer you'd use to power a sawmill, it doesn't have to be terribly big, but basically it generates low voltage electricity. So low voltage AC, and it sends it through triple aluminium busbars. So basically aluminium tubes, very light and can be put together with a patented connector. So we have a patent on doing this, we don't use single phase electricity, like every other LED installation in the world. And if you know anything about your physics, it's a sine wave, it's basically going up and down. And when it's in the middle, not the top or the bottom, it's switched off. So basically, the this electricity single phase is switching LEDs on and off 50 times a second. Our system overcomes that we use the three phases to balance each other, and then we rectify it to DC, which gives it the perfect amount of power to drive LED lights. And that is why we're able to be energy efficient. That's why we use this as the distribution system, but also the system of control over the lights. And that's why we can make any spectrum and we can basically mimic any climate that you like. And we use that in the horizontal sense in a polytunnel or a glass house. And then we use it in a vertical sense inside the vertical farm. And I could only assume then that would also lend itself to other IoT devices that could be plugged into that were necessary. For climate control, for monitoring, whether it's cameras or sensors, or whatever, absolutely. I came across the other day an Israeli business and they've invented a sound wave that makes all insects below three millimetre explode when they hear the sound. I don't know whether it was a spoof call, I'm gonna get one on April the first one day. But you have to put one of these sound speakers that send out that sound wave every 10 metres. So this could be another device to put on your grid. And we discovered a bug killer totally by accident. It was Armistice Day, I think it was 2018 and I asked the guys, if they could grow red poppies for Remembrance Sunday. We didn't have enough time. We do grow flowers, but we didn't have enough time. So what they did was on Remembrance Sunday, they turned off everything apart from the red lights, and we put a webcam into the tower. And you know, people really liked it. But when we came back in on Monday, the tiny little flies that we got off some batch of peat or whatever it was had all gone. It turns out that they can't see red light. And so the only light they could see was the UV light in the bug zapper at the back of the tower. So we actually had a massacre on Remembrance Sunday, but it was a massacre of flies. That's great story. Anyway, the point is that that stuff is going to get invented as we get more elaborate. And the more data and more knowledge you get, I can only assume that we're gonna want more things to go on these devices. Yeah, and there are lots of great manufacturers around the world who are making the lights, making the sensors, making the cameras. And so our job is to provide basically an infrastructure that makes the most of all of these various inventions, and then you simply clip them onto the bus bars and away you go. Guess again, back to the the vertical farm industry, how you've come up with innovations to solve problems that were there. And then from a classic sense that fascinating transfer then of those innovations come about through. So for instance, data, analysing the data starting to micro-precision manage different AV tests of different recipes of different sequencing, all kinds of different things that you can do. Starting to deploy that in a horizontal farm in a glass house or permanent poly environment could have massive implications on the industry. Yeah, from a data point of view, we think about generating what we call growth recipes. So the growth recipe is, if you think about the weather, if you want to simplify it, the weather consists of the sun, the wind and the rain. So you've got like a three dimensional almost like a hollow cube. Each one of those dimensions has eight to 10 major factors. So we talked about some of them on the light earlier, if you think about the wind, you've got wind speed, you've got a volume of gas, you've got a mix of gases, you've got temperature, and so on and so on. And what you're really looking for with that is a very even flow of a large mass of air moving very slowly, so you don't ruffle the canopy of the crop. And you get very even growth, which is what a lot of off takers are looking for. You then discover that each one of these factors has got an almost infinite number of possible values. Let me go back to light spectrum. Think about when you're going to repaint your bathroom, you go into a DIY shop and you stand there looking at the colour swatches and you follow it with your partner after five minutes because there's too much choice Well, that's what light is like. There is an infinite number of possible colours. And so therefore, you've got to be able to make that but the beauty of it is you can then experiment. So if you've got the ability to control the sun, the wind and the rain in slightly different ways, in different areas of either a polytunnel or trays in a vertical farm, you've got this massive workbench in effect, and you can discover what the optimal growth recipe is for each variety. And then once you've locked that in the artificial intelligence will just continue to deliver it. And then we would use machine learning to watch what happens to the crop as we apply that growth recipe. And of course, you can vary substrate and the seed you buy and all that kind of thingas well. And you provide that data processing? Yes, yeah, it's all done in the in the cloud. And it's all done from the farmers mobile phone. So you don't need an IT department to do this. Farmers don't want IT departments, they just want to get on with growing. And the potential to start using the machine learning that could start to learn across all the different ways of doing this. But then they learn from each other almost. To accelerate this. And to be at the front of that would be pretty damn interesting. We've seen it in other sectors. Previously spoken to you about a German business that's reduced the plant selection by 80%, just by better data science, for Plant Breeding. Then we start to apply that across the growing system or propagation to then growing systems. There's incredible efficiency gains here. Cost savings, genuine cost saving. So let me get back to the point is if we can, we can feed the planet, because we're actually removing costs, not adding costs. I think the perception is the vertical farm industry is perceived as adding costs. Yeah, what you're telling us here today is the opposite. And we're gonna reduce costs across the entire industry of horticulture, not just vertical farming. And with with that experimentation we discussed a moment ago, it's not just about growing a wider and wider range of crops, but it's about growing them more efficiently using less energy and so on, and so on. And, in fact, we have now agreed a vertical farming tariff with one of the power companies, because the way our farm works, you can actually give control of it to the electricity supplier, and they can switch it on and off when it suits them, the crop doesn't mind when it gets its 18 hours of sunlight, it doesn't have to have it during particular hours. And it doesn't have to have it in a single block. It turns out that provided you allow the crop to rest for cumulated, six hours in every 24 It seems to be fine. And so therefore we can continue to innovate and change these things and make them more and more efficient. The opportunity here as well is that it's not dependent on where it is. And this will apply to vertical or horizontal. Absolutely, we can stick this thing anywhere. I mean, it's one of the five or six major environmental improvements, as well as economic is the ability just to put this thing up wherever you like. So on a piece of unusable and used brown field land close to a point of consumption, you're going to massively reduce the food miles and the carbon debt. So pulling this all together. The horizontal farming industry can now benefit from vertical farming, vertical farming plays because of its 'go anywhere' thinking. But to actually take the hundreds of acres of vertical farming into the many 10s of 1000s of hundreds of 1000s of hectares of horizontal glass and permanent poly. That is a enormous market. Exciting opportunity in our post COVID world of needing to eat better, hopefully more affordably and everything else. David, it's a really exciting time. And I think talk about a moment in history, where Gosh, we need this more than ever. And I look forward to finding out your next next steps in the near future. Thank you. Great, thank you, Rob. It's been a pleasure. Wow, what an amazing call. All the flack that vertical farming has had from the non-believers, if that isn't evidence of potential transformational change that could be happening for the entire horticultural industry. And I guess the lesson here, the biggest lesson that I think I've learned today is thinking about this as an omni channel. By that I mean, it's not should it be vertical farming, should it be horizontal, it's going to be all of it. And innovations that are happening in both are going to work together with both. So now we're talking about vertical farming technologies being applied across hundreds of 1000s of hectares of poly and glass. That is going to change how we buy food and how we eat food in the fresh produce sector. If that isn't the most important thing we can do right now in this crazy planet we live in because we can't live off lettuce alone. But we can live off a whole wide range of fresh produce that these systems can grow. So super exciting times. Thank you for listening today. I hope you found that interesting. I certainly did. We're always looking for speakers and topics to talk about at Forward Food Tech podcast. If you feel want to get involved and give me a shout, contact details will be in the notes. Other than that, have a great day. Thank you for listening! Thanks very much for listening. If you enjoyed this episode, please subscribe, give us a five star review and share the podcast with your friends and colleagues. For more information and takeaways from this episode, please visit forwardfood.tech. See you next time!