October 13, 2022

By Lynda Kiernan-Stone, Global AgInvesting Media

Soli Organic, the only soil-based indoor farming company in the U.S. growing USDA certified organic produce, has closed on nearly $125 million in Series D funding led by global investment group CDPQ.

Leading European investment firm Movendo Capital B.V. also joined the round, which included follow-on investments from existing investors S2G Ventures, Cascade Asset Management Company, and XPV Water Partners.

Founded in 1989, Soli Organic was known as Shenandoah Growers until October 2021 when the company raised $120 million through an agreement with leading developer-led investment management firm Decennial Group, and relaunched with a new corporate name and brand – Soli Organic. 

The company is the first leader in the produce category to transition from field production to soil-based controlled environment agriculture. Its proprietary system and use of soil, water and energy-efficient technologies, and strategic farm locations have enabled it to achieve exceptionally low per unit costs for organic produce, on par with outdoor traditional production, and much lower than rival indoor agricultural producers – even non-organic.

“Through our proprietary soil-based, organic, indoor production system, Soli Organic is the first company to unlock the full value of controlled environment agriculture, including considerable cost savings and environmental benefits,” said Matt Ryan, CEO of Soli Organic, in October 2021. 

The company notes that to-date, it has relied on very little venture funding, instead opting to reinvest profits into technology development in pursuit of price parity with field-grown organic produce. Recently, Soli Organic unveiled its “Indolce” basil, priced at nearly a dollar less per ounce on average than field-grown organic produce, and the first of many new comparably priced products in the pipeline to be rolled out in the near future.

“Throughout our 30-year history, first in organic field agriculture and now as a leading indoor organic farming company, Soli Organic’s north star has always been what consumers care most about: organic, flavor, quality, freshness and affordability,” said Ryan.

“Our unique technology advantage enables us to offer a superior consumer proposition. Growing indoors in soil confers both high quality and better unit economics, breaking the paradigm that organic food must cost more,” continued Ryan. “We’re excited to work alongside world-class partners like CDPQ, Movendo Capital, and returning investors to bring our products to more consumers across the country.”

Combined with the $120 million in financing mentioned above, and another $50 million in venture debt financing from Horizon Technology Finance and Bridge Bank, the capital raised through this Series D will be used to continue the build-out of additional large-scale, high-tech, soil-based indoor farms, transforming the company’s national footprint.

Currently in the process of scouting sites for its next farms in the U.S. Midwest and Northeast, eventually, Soli Organic plans to have a total of 15 farms strategically located across the country, including high-tech facilities in the Mid-Atlantic, Southeast, and Pacific Northwest, along with several smaller early-generation facilities currently in production. 

“We believe that Soli Organic is one of the most promising companies in indoor farming,” said Sanjeev Krishnan, chief investment officer and managing director, S2G Ventures, and member of the Soli Organic Board of Directors.

“With transformational soil-based growing technology, the company has solved the quality, affordability, and crop diversity issues that challenge others in this space, all while being organic.”

Krishnan continued, “For returning investors, Soli Organic offers a track record of strong performance – buoyed by effective and creative leadership and a relentless focus on unit economics as the company continues to scale – all while offering considerable ESG benefits for investors and others seeking to reduce the impact of the food system and boost access to healthy food options.”

For CDPQ, a key driver behind this investment is sustainability and ESG, according to Geneviève Bouthillier, managing director, private mid-market companies, who noted, “Vertical farms like Soli Organic’s are a fresh approach to grow food in a sustainable way.”

“This investment is in line with the mission of CDPQ’s Climate Innovation Fund (CIF), which aims to support initiatives that provide innovative solutions to the challenges posed by climate change, alongside like-minded investors such as existing partner S2G Ventures.”

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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