David J. Lee, President and Board Member of AppHarvest, joins Yahoo Finance Live to discuss sustainability in farming and outlook for the company.
ALEXIS CHRISTOFOROUS: The agriculture tech company AppHarvest recently released strong quarterly earnings, their first as a publicly traded company. Joining us now is AppHarvest's President and Board member David Lee. David, good to see you, and congratulations on the move to AppHarvest because the last time you and I spoke, you were CFO of Impossible Foods.
So I'm seeing a bit of a pattern here. You like to join these companies that are disrupting their space. Tell me what prompted you to make the move to AppHarvest.
DAVID LEE: Well, for me, it was about the mission. Jonathan Webb at AppHarvest, he has a chance not just to help the environment, help people's health, give them fruits and vegetables they desperately need. He has a chance to create a renaissance right in Central Appalachia to take a part of the country that's seen the demise of coal mining and create growth for a community, giving skilled labor a living wage to create a renaissance in the economy and for the environment. It reminds me a lot of when I joined Impossible Foods as COO in 2015 when we were quite young. It's another chance to build hopefully a great company that does well but makes a difference for the planet as well.
- I'm hoping you can spend a little bit on that, David, how AppHarvest and really its inclusion of technology in agriculture can really help impact food security and sustainability in farming and even the country's food supply.
DAVID LEE: Yeah, it's amazing. We-- we try not to think-- maybe we even are in denial about the problem we face. It's not just about the impact on the environment. Some have estimated more than 50% more food required just to feed the planet by 2050. But with 70% of our fresh water already used to make food, the math just doesn't add up.
So for me, this problem of feeding the masses, creating equal access to high-quality nutritious food, and the need to save the planet all come together. And for us, it's about using technology at AppHarvest, creating a consumer movement, being radically transparent, and-- and trying to build a better food company, very similar to where we started back when we launched the business at Impossible Foods. These are two companies that are different, but they share a common approach. Do well for investors, do well for the planet, and demonstrate that you can do both.
- So, David, I-- I saw that AppHarvest, I know that you guys started with those beefsteak tomatoes. You've now moved on to strawberries. Why was that the fruit that you decided to move on to next? And what's coming after strawberries and tomatoes?
DAVID LEE: Well, the wonder of AppHarvest's technology is that we can produce whatever the consumer needs. And by the way, the consumer needs a lot more. Only one in 10 US consumers get enough fruits and veg.
But we started with vine crops-- these are the tomatoes, the berries, the peppers that we all eat-- because something like 69% of them are shipped in from outside the country for days on end, chewing up diesel. They're often covered in harsh chemical pesticides, and they've been designed for longevity, not for taste and not for health. So we started with, one could argue, one of the more ubiquitous forms of fruit and veg, the tomato.
And whether you enjoy it fresh or in ketchup or in a marinara, we wanted to prove that the everyday use of a tomato-- the everyday growth of a tomato could be done better. Better because we recycle 90% of our rainwater. We're within a day's drive. 70% of actually the consumer gets the benefit of our product [INAUDIBLE] time.
And, you know, we're really trying to give our company a chance to demonstrate to treat its employees better, too. To treat local employees well by giving them a living wage, by giving every full-time employee equity in this now public company. So we have a lot to prove to the world that we can make a difference and at the same time be a compelling investment for our public company investors.
ALEXIS CHRISTOFOROUS: What about proving your worth to-- to investors because I'm taking a look at the stock price. And it's-- it's basically been cut in half since the company went public. You made that acquisition recently of Root AI, which is a start-up known for crop harvesting, using bots to crop harvest. Is-- is Wall Street just not getting the messaging? Are they not getting the bigger picture at AppHarvest?
DAVID LEE: Well, I think it will take time for all of our investors to understand the potential here. Remember, we went public through a SPAC. And that $10 per share SPAC acquisition price has seen, as you noted, [INAUDIBLE] huge increase and now a settling to around $15 per share. Our focus isn't on the share price.
Our focus is creating the value for our shareholders over the long term. The good news about our business is that it is a fundamental need for American ag to lead in a way it has not recently. And so whether you look at our stock price this quarter or next quarter, our focus is the multi-year vision and-- and ability to do better as a food company, to do better for the planet and for consumers' health.
ALEXIS CHRISTOFOROUS: And, David, I want to switch gears for a moment because all this month, we've been concentrating on Asian Pacific American Heritage Month. I know that you are of Korean descent. And I also know that you recently signed an open letter from Asian-American business leaders. What do you hope to-- to get out of having written that letter? And what is your message to corporate America?
DAVID LEE: Well, our message to the world is that we all need to demand a better workforce, a better workplace. At AppHarvest, we have a zero tolerance policy for any form of discrimination and harassment. But even more, we're one of the handful of public companies that are B Certified and a Benefit Corp.
And that kind of passion that the company aspires to demonstrate at AppHarvest, I think we as individual leaders who have come to this country, who are citizens of this country, need to demand it of each other. My parents came from South Korea, two medical doctors, when this country in the '60s had struggled to find primary care physicians for rural America. I was born and raised in eastern Washington state.
And I was raised with a heritage of being able to do well for the community and do well for yourselves. And for me, this open letter is-- is an example of the promise that I believe this country offers folks who emigrate but also people who have been here for many generations to-- to no longer be tolerant of the behaviors that don't live up to the potential of this country. So for me, being able to-- to offer some small role in demonstrating that I stand with our community was important and, frankly, was what my parents came to this country for.
ALEXIS CHRISTOFOROUS: All right. Well, David Lee, president of AppHarvest, thanks for your candor. Always good to see you and have a great week.