Berlin-based urban farming startup Infarm announces Japan expansion

From left: Erez Galonska (CEO, Infarm), Takako Tsutsumiguchi (President, Kinokuniya Supermarket Chain), Shun-ichiro Yamashita (President, Muroo), Teruyuki Omote (Executive Officer, Deputy Director General of Life-style Business, JR East), Ikuo Hiraishi (Managing Director, Infarm Japan)
Image credit: Masaru Ikeda

In Tokyo today, Japanese digital agency Infobahn is holding the TOA World Tour Tokyo meet-up as one of the stops introducing Berlin-based outstanding startup conference Tech Open Air to local communities. In the meet-up, Erez Galonska, fonuder and CEO of Berlin-based urban farming startup Infarm, was invited onstage to announced that his company has raised funding from JR East (TSE:9020), one of key local railway operators, to expand into the Japanese market. The Berlin startup is expected to launch the service this summer in the Kinokuniya premium supermarket, a subsidiary of JR East.

Some of our readers may recall that Indoor Urban Farming, the German business entity behind Infarm, secured a total of $100 million dollars in a series B round led by London-based VC firm Atomico last year, which brought their total sum of funding to date up to $134 million US. The stage of the latest round is not defined because it’s specifically set up for partnering with JR East and its retailing arm Kinokuniya. In a response to Bridge’s asking, Infarm declined to disclose how much they have raised at this time.

Infarm was founded in 2013 by Osnat Michaeli and the Israeli-born brothers Erez and Guy Galonska to cultivate greens in the dead of the German winter. We covered them for the first time when their team won the Innovation Weekend Grand Finale pitch competition, the startup showcase event hosted by Tokyo-based VC firm Sunbridge Global Ventures back in 2015.

Infarm founders: CMO Osnat Michaeli, CEO Erez Galonska, CTO Guy Galonska
Image credit: Robert Rieger, FvF Productions UG

With Infarm’s solution, its cloud constantly optimizes temperature, humidity, lighting, pH and other environmental factors so that leaf vegetables such as herbs and lettuce can be stably grown in it regardless of the climate. Just requiring power, water and WiFi to work, it is so flexible to fit any type of location. For the current model, seeding is performed at the Infarm hub facility while each plant piece will be semi-automatically exported out of the farming unit when it’s ready for shipping. The market-ready pieces are sent into the facility at a supermarket so that consumers can purchase them fresh while they are still growing and being stocked in the storefront.

Infarm has expanded into France, Switzerland, Luxembourg, Great Britain, Denmark, Canada and the United States, as well as its home turf of Germany, partnering with local supermarkets such as Irma (Denmark), Kroger / QFC (US), Marks and Spencer (UK), Metro (Europe) and Edeka (Germany) to sell locally-grown vegetable products. With more than 600 Farming Units in stores and distribution centers around the world, they are shipping more than 250,000 plants a month. For Infarm, their sales at the Kinokuniya supermarket will be the first not only in Japan but also in the entire Asia region.

Infarm is establishing a local subsidiary called Infarm Japan in Tokyo to enable the expansion into the Japanese market. As Managing Director of the Japanese entity, Infarm appoints Ikuo Hiraishi, the organizer of the aforementioned startup pitch competition as well as CEO of DreamVision. DreamVision has taken over the fund management of Sunbridge Global Ventures which participated in the seed round of Infarm.

Inhub, Infarm’s farming solution
Image credit: Infarm

In addition, Japanese cold supply chain company Muroo, which boasts one of the largest chilled logistics networks in Japan, will partner with Infarm to help the latter roll out their facilities all across Japan. Muroo’s President Shun-ichiro Yamashita was a student of the MBA class that Hiraishi was teaching as a visiting professor at Hosei University Graduate School of Business in Tokyo.

Erez Galonska told Bridge in an interview:

We are excited about the expansion. Japan has unique problems to tackle, such as a large amount of food loss, challenging sustainable agriculture in hash natural environments including frequent typhoon attacks, and also aging farmers…So I believe our capability that requires less human operation to deliver fresh vegetables is significant. […]

Since JR East and Kinokuniya were looking for innovation, we thought synergies could be found by partnering with them. As expanding into Japan, we will adjust our product lineup to fit local consumer’s preference by adding Asian leaf vegetables.