An Albertsons store in Laguna Niguel, California
Scott Mlyn | CNBC
Under the multiyear agreement, Plenty will provide 430 Albertsons’ stores across California with four types of greens – baby arugula, baby kale, crispy lettuce and mizuna mix — priced between $4 and $5, in line with other organic greens.
The deal is a pivotal moment for the data-driven company, which uses machine learning and customized lighting to optimize for taste. Analytics run deep in the company’s DNA; it boasts a roster of engineers — a fair share of which came from Tesla during the company’s early stages. They work alongside farmers, including the company’s two co-founders, and sensory scientists. The company says its long-term mission is to make nutrient-rich produce accessible to 500 urban centers around the world.
The Albertsons deal is its first big step toward that goal. It follows a test run with the grocery chain that began before the coronavirus pandemic forced people to stay at home.
Plenty’s co-founder and CEO, Matt Barnard, said the company was able to supply Albertsons’ stores without interruption, which offered the grocer a critical proof of Plenty’s value.
“Their customers loved it and it started flying off their shelves and, in a category-leading pace,” said Barnard. As supply chains were disrupted during the early days of stay-at-home orders, Plenty proved its resiliency by keeping shelves stocked. “There were times when Plenty was the only thing on the shelves,” he said.
Its backers include a long list of high-profile investors, including Jeff Bezos and Eric Schmidt. Last year, the company raised $175 million in a Series C deal, bringing its total funds to $400 million and its valuation to $1.05 billion, according to Pitchbook data.
As Plenty, which currently ships to more than a dozen Albertstons stores, faces the daunting task of supplying to hundreds more, the latest infusion of capital will help bankroll the effort. Barnard expects it could take up to two years to fully ramp up its production.
In order to supply all the stores, Plenty will rely on its newest, fully autonomous farm in Compton, California, which is still under construction. It’s also unclear when it will open. But Barnard said its South San Francisco commercial farm, named Tigris, currently produces 200 plants per minute, and it continues to improve on yield year after year.
“If you look at four years ago, our turnover was a third of what it is today. Our yields leapfrog from one year to the next,” said Barnard.
Plenty has faced challenges of doing too much, too fast. It shelved plans last year to open another indoor farm in Seattle, in order to prioritize its efforts on the Southern California one.
Plenty also has formidable competitors in vertical farming, including Kimbal Musk’s Square Roots and Larry Ellison’s Sensei Ag, Barnard said. But Barnard, who grew up on a farm, is unfazed by the competition, saying Plenty’s singular focus on taste is what makes its products so unique.
“People aren’t used to eating greens with their fingers out of the box without a fork, without dressing, and without other ingredients, because we’re not used to them tasting that fantastic,” he said. “When you add that 365-day resiliency, that’s really the difference relative to what’s currently on the shelves.”
Correction: Last year, Plenty raised $175 million in a Series C deal, bringing its total funds to $400 million and its valuation to $1.05 billion, according to Pitchbook data. An earlier version of this story misstated the timing of the funding round, its stage and who was involved.