AppHarvest CEO details how company uses tech for farming indoors

AppHarvest CEO Jonathan Webb speaks with Yahoo Finance reporter Julie Hyman at the SXSW about tech innovation in the farming space and the future of the industry.

Video Transcript

DAVE BRIGGS: Welcome back, everybody. How are sustainability and technology remaking the future of farming, and in the process, producing a tomato that is even Martha Stewart approved, believe it or not. Julie Hyman has the latest on that story with the CEO of AppHarvest down at South by Southwest. Hi, Julie.

JULIE HYMAN: Thanks, Brad. Hi. Thanks so much for that. Indeed, Martha Stewart approved. She's on the board of the company, and she likes the tomatoes. I mean, they're tomatoes. They're delicious if farmed correctly. Jonathan Webb, CEO of AppHarvest, is, indeed, with me. Before we dig into the heavy stuff, why don't you tell us that story about sending Martha Stewart the tomato?

JONATHAN WEBB: Yeah, so been very fortunate to have Martha on our board and really consider her a mentor. And anybody who's an entrepreneur looks up to her, I'm sure. I know we do, but very attention to detail and before we send any product out to stores initially, I can assure you, I was there with the team, getting that package up to Martha, and got the phone call that thumbs up, they taste great, send them out. So we were, first night sending those up, a little nervous to get the feedback. But yeah, she's been an incredible resource for us and just a huge name in food that has been very helpful with us early on.

JULIE HYMAN: Well, great. You guys not long ago, I believe at the end of February, came out with your numbers. And you also talked about your goals for this year. Right now, you have one operational farm. So to be clear to everyone watching, these are indoor farms to controll the environment. Vertical farming is another word that people use for it. And you're aiming to open three more farms by the end of the year and also expand your product offerings beyond tomatoes. Are you going to meet the target? I mean, you have to get building materials. You have to get labor, which is challenging in some places right now. How's the project looking?

JONATHAN WEBB: We're really, really proud of our team in Kentucky that's been able to really navigate the supply chain issues in the middle of the pandemic. We have three more facilities coming online this year, totaling about eight million square feet. And to put that in perspective, our Moorhead facility, just under 3 million square feet, is about 50 football fields in size.

So large stuff, a lot of steel, a lot of glass, a lot of lights going up. And our construction team has been phenomenal. We're getting close on just a couple of those facilities and plan on having all three up and running before the end of the year. And it does-- we do get a diversified crop at that point, so salad greens, a variety of leafy greens, strawberries, and a whole host of different variety of tomatoes that'll be on grocery store shelves all across the US.

JULIE HYMAN: One of the things that has been a theme of South by Southwest that we've talked with a lot of VC folks about is the number of companies that have remained private and have gotten enormous, even though they're still staying private companies. You guys made the decision to come public. And the sort of class of 2021, if you will, of companies that came public, a lot of them are not doing so great. Unfortunately, for you, AppHarvest is among them. Do you regret coming public when you did? And how do you kind of now adapt to being a public company CEO?

JONATHAN WEBB: We see this as a couple decade journey. And really, we're in our first decade. And for us, being transparent with not only the consumer, but having that transparency of a public company, as we build a large global food company, we think the long-term benefits are great. And we do stand by kind of going and taking that message directly to the Street and getting that rigor of Wall Street early, which I think will make us stronger in the long run.

But for us right now, it's just, we have the capital we need, and we're focused on building and operating, and just head down on execution. So, you know, right now, it's just build and grow the business. But that term, CEA, Controlled Environment Agriculture, it's really the third wave of sustainable infrastructure.

And you look at renewable energy 20 years ago, electric vehicles 10 years ago, if we want to get CEA to be institutional at scale, not only in households with consumers, but I was in DC a week ago, meeting with both sides of the aisle, you really need that rigor of the public markets and that attention of the public markets to help institutionalize an industry. And for us, at AppHarvest, this isn't just about a company. It's about getting the industry to turn the corner at scale globally. And we don't think we could do that if we weren't in the public markets.

JULIE HYMAN: And not just for CEA, but do you feel like for sustainability generally and for companies that are trying to put forward various sustainable industries, do you feel like we need to have more of a public market wave to push that forward as well?

JONATHAN WEBB: Absolutely. I mean, we need-- innovate or die, right? And that's literally Gen Z, millennials that we were talking earlier about, the optimism here at South by Southwest. Those next innovative ideas are coming from the people wandering these streets here in Austin. And, you know, absolutely, the public market needs to have a robust category of companies that are building stuff that matters. Tech for good-- the consumer wants it. The regulators are pushing that direction. You obviously see the capital flowing into ESG.

And yes, it might go up. It might go down. But the reality is, we're going to fix these problems through the private sector. These global problems that we all face will be fixed through good companies, or we're going to be in a lot of trouble in 10, 20, 30 years from now. And I think my generation and even below, we realize that. We don't have a choice. We have to build the companies. We have to work at the companies that are offering good solutions. And it's not going to be easy, and we're going to get punched along the way.

But I think it's that resiliency that I hope this generation is going to fight through. And that mentality is, yes, we're going to see more and more of this through the public markets and more companies on Wall Street that actually matter, versus are just out there selling a worthless product that's not good for people and not good for planet and arguably questionable for shareholders. It's combining all that together, and that's the hard thing.

Not just looking out for the next three months, but doing that while also looking out for the next decade and the decade after, that's hard. It's easy to be a CEO that's looking for the next three months. It's hard to be the one that's looking two decades down the road while thinking of the here and now.

JULIE HYMAN: Jonathan, thanks so much. Good stuff. Jonathan Webb of AppHarvest, really appreciate it. Thank you. Back to you guys.