Startup Profile: Sustainable Agriculture on the Roof
April 28, 2011 | Jeremy Ogul
Mike Yohay, CEO of San Francisco-based urban agriculture startup Cityscape Farms, was raised in Brooklyn, NY where he grew up with almost no knowledge of where his food came from or how it was grown. This all changed for Yohay when he went off to study at Grinnel College in Iowa. There he saw firsthand the pollution and topsoil erosion caused by large-scale agribusiness operations. He was also troubled by the fact that despite its rich soil, Iowa exported most of the food that it produced and imported most of the food that it consumed. Yohay also worked in Costa Rica’s La Amistad rainforest, where he participated in low-impact organic farming that supported a local community.
Through these experiences, Yohay realized that “food is something that I saw as really touching all socioeconomic backgrounds and having a profound impact on the environment.”
So, after completing the Green MBA program at Dominican University, Yohay decided he wanted to focus his career on food production and establish a model for profitable, healthy, locally grown food in urban settings.
Cityscape Farms is the embodiment of this model.
Cityscape Farms Aquaponic Greenhouses
Cityscape Farms is in the process of developing greenhouses that utilize aquaponic systems, which combine aquaculture (fish cultivation in tanks) and hydroponics (soilless plant cultivation in water). In aquaponics, instead of growing crops in soil that often requires expensive artificial and environmentally harmful fertilizers, the fish effluent (waste) that accrues in the fish tanks provides an organic nutrient source, or natural fertilizer, for the crops being grown in the hydroponic system. The crops in turn consume the natural fertilizer and in the process filter and purify the water, which is subsequently recirculated back to the fish.
Energy Savings and Other Benefits
According to Yohay, “when people think about the production of food, most people think the biggest energy requirement comes from the transportation, but the reality is that it’s the fertilizer used.” In contrast, in a Cityscape Farms aquaponic greenhouse, fertilizer is generated organically from the fish waste in the system leading to significant energy savings when compared to traditional field agriculture.
Another benefit of the Cityscape Farms greenhouse is that a majority of the water in the aquaponic system is recycled, which both greatly reduces the need to tap into already strained water sources and eliminates the risk of contaminated runoff. Using a self-contained aquaponic greenhouse also reduces the need for pesticides and can additionally cut growing time in half. The greenhouse is also insulated from other variables that traditional farmers have to deal with, including extreme weather and fluctuations in fertilizer costs.
Cityscape Farms Business Model
Cityscape Farms seeks to lease unused commercial rooftops as sites for its greenhouse systems. From these rooftops, the company will grow fresh food that it will market and sell to local restaurants, corporate cafeterias and supermarkets. Cityscape Farms believes this model will benefit building owners by providing both monetary compensation for square footage that would otherwise go unused and a PR opportunity to bolster their green credentials. Cityscape is currently targeting commercial rooftops on buildings owned by green organizations and progressive corporations.
Cityscape Farms is still a couple years away from opening its first rooftop greenhouse in the city of San Francisco. “We’re still in a kind of pre-launch mode,” Yohay says. “We haven’t made any money doing this yet.”
The Market Opportunity
While a robust market for organic food exists in the U.S. ($24.8 billion in sales in 2009), there are only a handful of companies even attempting for-profit urban organic farming. This is where Yohay sees an opportunity. “It’s not like we’re competing for rooftops or vacant lots,” he says. “It’s such a small industry – not even an industry, it’s like a subindustry.” Cityscape Farms says its real competitors are the big agricultural producers. While the urban agriculture industry is small right now, Cityscape Farms believes that it will grow as more people begin to recognize the value of locally and sustainably produced food.
Farming in an urban environment presents logistical and regulatory challenges. For one thing, there are numerous city codes and planning department hoops to jump through. Other obstacles include meeting the seismic safety (a big one in San Francisco) and structural requirements of host buildings, and the liability associated with managing rooftop greenhouses. High electricity costs associated with powering high-intensity lights and climate control systems for year-round production in the greenhouse pose an additional challenge.
Fortunately for Cityscape Farms, San Francisco recently passed an amendment to its planning code that makes it easier to set up for-profit urban farms.
Funding for Cityscape Farms is another hurdle. Yohay could have started out small, but decided against starting with a scaled down version of the concept. “It didn’t pay to do it on a compromised scale,” he said. “I have a bit of a ‘go big or go home’ mentality about it.” A 10,000 square-foot greenhouse, the minimum size that makes sense to him, costs between $50 and $65 per square foot. Funding for the company thus far has come from angel investors and after two years Cityscape Farms has raised nearly half the funds necessary to launch its first aquaponic greenhouse project.
Looking to the future, Yohay said he’d be thrilled to have a handful of greenhouse projects off the ground in the next five years. He anticipates a franchise model within the next decade. After establishing half a dozen or so successful greenhouses in U.S. cities, Cityscape Farms would then look to expand its reach internationally.
Ultimately, the real challenge according to Yohay, is getting people to think differently. “More than anything else,” he says, “it’s sort of a cultural mindshift. People see cities as fatalistic to the environment – there are pigeons and trees, sure, but not much else. We’re really trying to shift that attitude so people can start to see that the city presents a huge opportunity where unused space can be used for food production.”