Is the Future of Local Food Hiding Inside Shipping Containers?

Local food is not just a growing trend but also a fertile ground for innovation. Last June I wrote here about BrightFarms’ innovative model of supermarket rooftop farms. Another example is Atlanta-based PodPonics that is also presenting a unique approach to growing local food, combining computer-controlled environmental systems with recycled containers.

PodPonics believes its approach represents the future of farming. On their website they write that “we answer the growing consumer demand for local food by producing it in urban centers, using an approach that does not require arable land.” The person who came up with this approach is PodPonics founder and CEO Matt Liotta. He is a serial entrepreneur with internet and telecom startups experience, who told Fast Company earlier this month his goal was to find a disruptive technology in the field of urban agriculture that will enable production of fresh produce at the point of consumption in a way that is economically viable. The solution he found was a combination of high tech and low tech, using advanced hydroponic growing systems in used shipping containers to grow produce. PodPonics repurposes recycled shipping containers as Grow Pods, and is using advanced technology to create a controlled environment inside them, regulated by a proprietary system that controls temperature, humidity, light, water and nutrients. PodPonics claims it can produce in one container, which is about 320 square fit, an acre's worth of produce.

Using containers is a great idea - not only do they  provide an ideal area for growing produce super efficiently, but they are also inexpensive, highly available, durable, easy to transport and stackable. These containers should assist PodPonics in reaching economies of scale, maintaining a high level of flexibility and making the company economically feasible.

We don’t have data on how much it costs to set up a container as a Grow Pod, nor PodPonics’ ability to match market prices or expected profitability, but we do know investors believe PodPonics can build a viable business. Last month the company reported it completed a seed funding round, raising a total of $725,000 from a group led by international private investors. Liotta was very pleased by the investor interest in PodPonics, saying in the press release: “It’s noteworthy that we were able to raise this amount of capital with relative ease working with sophisticated investors, given the early stage of our venture and the overall challenging economy. It proves we are on to something big, a fact we never doubted.”

Atlanta Mayor, Kasim Reed, also thinks PodPonics is on to something. The company signed an 11-year lease at the Southside Industrial Park with a unit of the Atlanta Development Authority. "I'm delighted that PodPonics has selected Southside Industrial Park to house their innovative urban agricultural operation that will employ up to 30 people over the next two years," said Mayor Reed.

PodPonics hasn’t moved yet to its new location, but is already growing produce in its original location in Atlanta on Ponce de Leon Avenue. There the company is operating five pods producing 150 pounds of lettuce, arugula, watercress and other micro-greens every week that are sold to leading Atlanta restaurants and grocery retailers.

Atlanta though is only the beginning of PodPonic’s journey and Liotta has bigger plans on national level. Recently the company signed contracts with some of the country’s leading produce distributors and next year PodPonics expects to be able to supply universities. After that, large chain grocery stores will be the next target.

PodPonics believes it found the optimal sustainable model to bring urban local food to the masses. Let’s look how sustainable this business really is. From an environmental point of view, it gets a high grade – It uses recycled shipping containers, doesn’t use fertilizers, uses water and energy very efficiently although the pods are powered by electricity from the grid, conserves land and reduces the carbon footprint of produce.

From a social point of view they also get a good grade, creating local jobs and providing access to healthy, fresh and nutritious foods in cities. They also have an educational dimension, supporting schools, non-profit and civic organizations in an attempt to provide more access to fresh food and to teach children that food must be grown and does not come from a supermarket.

The main question regarding the social layer is how affordable the prices of their products will be. This also brings us to the main challenge of the company – creating a viable business. This part is the main challenge every entrepreneur who wants to sell local food on a large scale is dealing with – how to create a profitable business, while keeping prices competitive?

PodPonics has some substantial advantages that should help the company meet this goal - they are able to have year-round crop production and they have much higher crop density and predictable results by completely controlling the growth environment. Liotta and his team will try to use these advantages to benefit both consumers and the company. If they’ll succeed you might be able to purchase soon some fresh lettuce and other produce grown in a recycled container standing in the parking lot of your local supermarket.

Image credit: L Weiling, Flickr Creative Commons

Raz Godelnik is the co-founder and CEO of Eco-Libris, a green company working to green up the book industry in the digital age. He is also an adjunct professor in the University of Delaware’s Alfred Lerner College of Business and Economics.