AppHarvest

I never really understood the logic of trying to develop capital and energy intensive agricultural projects in a country where land is extraordinarily abundant and productive, and thus I never quite got the appeal of AppHarvest:

It was a familiar message, one that had been touted over and over in nationally televised interviews, public filings, and company reports by AppHarvest’s then-CEO, a Kentucky native and entrepreneur named Jonathan Webb. In 2018, the then-32-year-old Webb returned home with the promise of building a dozen high-tech, hydroponic indoor farms across Eastern Kentucky and the surrounding region, growing tomatoes, cucumbers, berries, and lettuce. Not only would he be piloting an advanced form of climate-resilient agriculture, he would also be generating gainful, blue-collar employment in some of the country’s most economically-distressed counties, where he argued that the coal industry’s downfall left a void that could be filled by sustainable industry…

Webb’s worker-centric pitch raised over $700 million for AppHarvest to get off the ground and catapulted him into the national spotlight, with largely glowing coverage from The Wall Street Journal, The New York Times, CNN, and Forbes. It also convinced a number of big names to join the company’s board: Martha Stewart, activist investor Jeffrey Ubben, former Impossible Foods CFO David Lee, and JD Vance, the venture capitalist and Hillbilly Elegy author who would later win election to a U.S. senate seat in Ohio with a Trump-inspired, anti-immigrant message.

Read the whole thing if you like the peculiar connection of hilarity and depression that Kentucky so often produces. The biggest problem appears to have been a stark disconnect between expectations and capabilities of the available labor force, although I’m not at all convinced that they ever could have made a profit from this project, which of course had to compete with conventional American agriculture. Tomatoes and coal are… different, and it wasn’t reasonable to expect that there’d be a lot of crossover in terms of available labor and transport infrastructure. Tomatoes are grown in California and Florida for obvious reasons, and it’s not obvious to me how making the growth cycle more capital intensive makes it more cost effective… but perhaps I’m just not sufficiently innovative. Disclosure: I know a couple of folks very close to the decision-making apparatus of this operation, and I once apparently visited a local burger restaurant only moments after the exit of Ms. Martha Stewart!