After taking the time to develop a new product, Goochland indoor farming company Greenswell Growers is seeing “exceptional growth,” President Carl Gupton said.
The company grows lettuce and other leafy greens in a greenhouse operation. Greenswell launched a co-branded product last month with Ukrop’s Homestyle Foods. That product is available at around 90 Kroger stores in the Mid-Atlantic region, and Gutpon said the company is about to make a Greenswell-only branded product available in two more grocery chains in the next month or so.
“We are at such a front end of this industry,” Gupton said. “By being located centrally in the Mid-Atlantic, we can hit 70% of the U.S. population within a day’s drive.”
Chuck Metzgar, John May and Doug Pick founded the company after looking into ways to provide healthy, locally sourced food to people who were food insecure. During his research, Pick, the president and CEO of Central Virginia nonprofit FeedMore, saw how efficient hydroponic greenhouses grew leafy vegetables.
Greenswell raised $10.8 million in 2020 and built a 56,000-square-foot facility to test the idea.
“It was the first of what we think will be three phases,” Gupton said. “We used this greenhouse to prove out our business model. We needed to figure out how everything works and how we can make fresh, local produce and get it into people’s hands in 24 hours.”
The company is set to break ground this summer or early in the fall on a second phase that will triple the size of the operation to 4.2 acres.
To fund the growth, Greenswell recently raised $6.92 million in equity and debt, according to Securities and Exchange Commission filings. Gupton declined to name the investors.
“It’s all our original investors,” Gupton said. “It’s nice to see that your original investors believe in what your do.”
The money will be used to expand the company’s operation and grow marketing and sales activities. Greenswell will have additional capacity come online next year when the expansion is complete.
Ukrop’s has been buying lettuce greens from Greenswell for its salads and sandwiches over the last year. Ukrop’s has an existing relationship with Kroger, and the two companies decided to approach Kroger together about a co-branded product. Kroger liked the idea and now Greenswell ships cases of co-branded salad boxes to a Kroger distribution center.
“We are the new kid on the block and wanted to leverage Ukrop’s brand recognition,” Gupton said.
Gupton said the company’s success has proven that its model works. He said most lettuce is grown on the West Coast and shipped. That reduces the product’s freshness and weather makes the harvest unpredictable. Despite the product’s low cost, Gupton said Greenswell can turn a profit. Unlike vertical farming, Greenswell uses mostly natural light and supplements with artificial light.
”We think we are a smart use of capital because our power demands are less,” Gupton said. “We are able to do things efficiently and automate it.”
The company has 13 employees. Gupton said Greenswell will have to add additional staff in the future but did not provide an exact number. He declined to give revenue numbers.
He can foresee a time when Greenswell provides lettuce up and down the entire East Coast.
“We all have aspirational goals of doing that,” Gupton said. “That might be here in Richmond with a megagreenhouse, or we could look into other markets."
