What vertical farming and ag startups don't understand about agriculture
What&#x27;s referred to as &quot;modern farming&quot; is in fact kind of grossly inefficient, destructive, and hopelessly dependent on subsidies as well as a handful of companies supply pesticides, fertilizers and other chemicals needed to squeeze some life out of a dying and eroding soil. We &quot;perfected&quot; that over the last century or so and it&#x27;s used to mass produce only a comparatively small number of  staples. I grew up in an era that was probably peak industrial scale farming (i.e. the seventies and eighties last century). A lot of stuff you find in a supermarket today was simply unknown or considered exotic at best. Bread came in two varieties: brown and white. The flour came from a factory. A lot of the stuff you put on top came out of a tube or a jar. James May (from Top Gear fame) has a hilarious Youtube channel called food tribe where he satirically highlights some seventies era sandwich recipes.<p>This type of farming scales only at the cost of variety, quality, the environment, and our health. Contrary to self serving studies, having less pesticides in your food intake is probably good for you. Also, less corn syrup in your life is definitely a good thing. And more variety in your diet is probably not a bad idea either. In a nut shell &quot;modern farming&quot; is a great way of feeding the poor and a core reason why obesity and poverty is a common combination in modern economies. All the cheap food is great at keeping you alive but not necessarily optimal for a long lifetime.<p>The promise of actual modern farming is vastly more efficient use of resources (water, energy, chemicals, the environment), more variety, better freshness, nutritional value, cost, being able to grow it closer to the place of consumption, etc. It has nice side effects like being less taxing on the landscape and environment and generally being associated with things that give people warm fuzzy feelings, which they tend to attribute some $ value to. I other words, modern farming is what modern farmers want to do because that&#x27;s where the money is.<p>If you look at the value chain in farming, it&#x27;s clearly a very tiered market. At the very bottom you have the basically inedible stuff that is destined for animal fodder and industrial processing. It&#x27;s by definition low margin and high volume. Farming practices in this space tend to be very destructive. It&#x27;s cheap only because the epic cost of cleaning up the mess is not factored in (that&#x27;s for the next generation to worry about).<p>One level up you have the stuff we actually can eat that is mass produced at razor thin margins for the industrial production of food. It&#x27;s the bottom of a value chain where most of the money is made by industries using the produce as the input for their food products.<p>Then we get more into niche farming where quality of production, production process, and the produce is the key goal. This is the stuff consumers pay extra for to get because it tastes good or makes them feel good. Whether it&#x27;s organically produced spelt flour hand ground by some bearded hipster or some japanese beer fed and massaged Kobe beef; this is high value, high margin, produce. Any farmer with a clue wants to be here because that&#x27;s where the money is. High margins and everybody thinks your cool. The only problem is that it doesn&#x27;t quite scale to feeding the planet. But nevertheless this sector has exploded in the last few decades.<p>And then you have actual high tech modern farming which does the former but in a smarter way such as to maximize quality and yield while minimizing cost. Vertical farming fits in here because it gets you fresh stuff pretty much straight from the farm into your shopping basket. The reason it&#x27;s currently applied mainly at the top end of the market is simply because that&#x27;s where the money is right now. But there&#x27;s no reason for this stuff not to eventually gobble up the rest of the market. There&#x27;s probably a lot of stuff that will fail to scale or to deliver but inevitably some it will work pretty much as advertised.<p>In any case, you won&#x27;t find silicon valley involving themselves with shaving of a hundredth of a percent on a tiny margin on producing glorified pig food. There are no 10x returns doing that. It&#x27;s a race to the bottom. Selling fresh basil to city dwelling hipsters on the other hand is a thing short term but hardly the end goal.