News

The Growing Importance of Controlled Environment Agriculture

As the global population grows and resources – be it land, water or energy – become increasingly scarce, traditional agricultural methods are being challenged. Enter Controlled Environment Agriculture – a revolutionary approach that is leveraging technological advancements to optimise the growing conditions for crops and other food sources.

Recognising its transformative potential, the sector is piquing interest from investors – including both traditional FMCG players and infrastructure funds – with Vertical Farming the most publicised area. As leading providers of due diligence and strategy advice to the European Food & Beverage industry, Food Strategy Associates have rapidly-growing expertise in advising within the space.

Our Expertise

On a recent assignment, we provided Commercial and Operational Due Diligence to a prospective investor into a UK-based vertical farm which included:

  • Profitability: Reviewing the profitability potential of the business, analysing current and projected unit cost and the assumptions underpinning these
  • Competition: Competitive intensity from incumbent and future supply sources
  • Market: Assessing the size of the target addressable market
  • Operations: Modelling the current and future-state capacity of the business, and performance on operational fundamentals
  • Growth: Critiquing management’s growth plans

“Food Strategy Associates expertly navigated the key commercial and operational due diligence areas we identified upon engagement and were able to additionally pinpoint crucial considerations that informed our funding decision. Their first-hand experience in the incumbent leafy salads supply chain, combined with their growing expertise in the emerging controlled environment sector, provided invaluable insights. This made them the ideal partner for our diligence exercise.”

Investment Director, Private Equity Client

Beyond this, Food Strategy Associates Partner, Nigel Devine, has completed capital investment feasibility studies on two further UK vertical farm operations, and is involved in two recirculatory aquaculture systems start-up projects. During his time in industry, he was a Factory General Manager for Geest, gaining first-hand experience of the incumbent leafy salad supply chain, allowing him to provide a unique perspective of the commercial and operational challenges vertical farms must overcome.

If you are looking to invest in the Controlled Environment Agriculture space, or a Controlled Environment Agriculture player looking to raise additional funding, please get in touch with Nigel at nigel@foodstrategy.co.uk to find out more about our expertise and how we can help you and your business.