Growing up … and up and up: interview with Sam Bertram
Warehouse-based “vertical farms” could help ease world hunger and solve some sticky supply chain problems in the process, says entrepreneur Sam Bertram.
David Maloney has been a journalist for more than 35 years and is currently the group editorial director for DC Velocity and Supply Chain Quarterly magazines. In this role, he is responsible for the editorial content of both brands of Agile Business Media. Dave joined DC Velocity in April of 2004. Prior to that, he was a senior editor for Modern Materials Handling magazine. Dave also has extensive experience as a broadcast journalist. Before writing for supply chain publications, he was a journalist, television producer and director in Pittsburgh. Dave combines a background of reporting on logistics with his video production experience to bring new opportunities to DC Velocity readers, including web videos highlighting top distribution and logistics facilities, webcasts and other cross-media projects. He continues to live and work in the Pittsburgh area.
The production and distribution of the food we eat each day presents some of the world’s biggest supply chain challenges. Some foods travel thousands of miles to market. Think of the banana you may have eaten today that came from Central or South America.
Many foods need to be kept refrigerated or frozen throughout their lengthy journeys, making the trips extraordinarily costly. The process is wasteful as well. Because many fresh fruits and vegetables have short shelf lives, a significant portion will spoil before ever reaching the consumer.
As our world continues to urbanize, it will be increasingly difficult to feed growing populations far from the farms that produce our food. That’s where vertical farming comes in. Growing plants in warehouses located close to urban areas can provide fresher food that requires fewer resources, isn’t dependent on climate or weather, and minimizes travel distance, a proposition that could eventually make it much easier to feed growing populations.
That’s the vision of Sam and John Bertram, two brothers from Melbourne, Australia, who originally came to California on college tennis scholarships. After completing their engineering studies, they looked for a venture where they could direct their talents. They found it in vertical farming. In 2017, the Bertram brothers co-founded
a Silicon Valley firm that has developed an automated indoor farming technology “stack,” enabled by proprietary robotics, cultivation, and AI (artificial intelligence) innovations. Sam serves as chief executive officer and John is chief technology officer.
Last year, the company opened its first commercial farm in a warehouse near San Jose. The farm, which operates under the company’s Willo direct-to-consumer brand, offers a subscription-based service whereby members are provided with a portion of the farm to grow herbs and vegetables of their choice and then have them delivered to their homes—what Willo calls “personalized farming.” DC Velocity Editorial Director David Maloney recently spoke with Sam about his operation and the supply chain implications of vertical farming.
Q: Can you describe the concept behind a vertical farm and what your farm looks like?
A: Absolutely. Vertical farming just means that you’re using the “third dimension”—you are no longer growing in just two dimensions [like a traditional outdoor farm]. We use a cultivation technique called “vertical plane aeroponics.” So, the plants actually grow out of thin air. There is no soil. Instead, a hydroponic nutrient-infused mix is misted onto the roots that serves all of the functions of soil. Rather than using sunlight, LED lights provide the plant with energy for photosynthesis. When you look at any of the dozens of walls—or “columns,” as we call them—within our facility, you see plants growing out of a two-story, double-sided wall.
So, you can imagine how a warehouse in an urban location could be used as a vertical farm. Usually, warehouses have relatively high ceilings, so that allows you to increase your density and plant production.
Q: How did you and your brother become interested in vertical farming?
A: In 2016, my brother and I came across a statistic that said that 1.1 billion people began this millennium malnourished. That’s an astronomically depressing figure when you think about the sheer number of people who don’t know where their next meal is coming from. Our desire to make an impact led us to found our first company, OnePointOne.
We looked at traditional farming and greenhouse farming, both of which are very mature industries, with tens of billions of dollars’ worth of R&D going into them each year. But in both categories, operations are fundamentally limited by the fact that the growers can’t control the plants’ environment. That was something that vertical farming solved. With vertical farming, you gain complete control of the plant’s entire experience—and, by extension, its taste, texture, shelf life, nutrient composition, appearance, and aroma. It is very powerful, and that is very pertinent to this conversation as it applies to the supply chain.
Q: And I’d guess the problems with more traditional farming aren’t going away, right?
A: No. They are only going to become worse. You have to think about a growing population, a decrease in arable land, and a massive increase in consumption of fresh water. Finding farm labor is also difficult. The average age of laborers in Salinas and Monterey, California, is between 52 and 56, and there’s no generation of farm workers coming up behind them nor any automation technology ready to fill the gap.
Q: What are some of the supply chain issues that vertical farming can address?
A: One would be energy consumption. Fresh food on average travels 2,000 miles to get to the end-consumer in the United States. Imagine the amount of energy that is required to move those plants and to keep them cold both in the truck and inside the retail store. It is astronomical. Most of the energy consumed in this model is actually in distribution and not production. Now, consider how much less energy would be required if the food were grown only 20 to 50 miles away.
But the main value proposition of vertical farms to the consumer is freshness. Leafy greens don’t last an hour if you leave them outside. They also experience significant nutrient loss when they travel long distances through the supply chain. Besides that, we can ensure that the plants in our facility never exceed their “chill points,” which greatly improves overall product quality and shelf life.
Q: What are some of the environmental benefits of vertical farming?
A: When you use aeroponics, the roots are getting exactly what they need all the time. We use zero pesticides, of course. We still apply nutrients, but obviously they’re in a far, far lower concentration than the fertilizer required on a farm. We use around 99% less water, with zero runoff and environmental contamination. That really matters when you consider the fact that 70% of fresh-water consumption around the world is for agriculture. We use, depending on the crop, around 250 times less land than a traditional farm does. That is really a function of the fact that we can grow year-round, grow plants twice as fast, and utilize the third dimension.
Q: What steps did you take to develop your farm?
A: The first thing we focused on was developing a technology that could produce food at a low-enough cost that it would make sense to deploy it around the world. We knew that labor was the number-one cost factor and that electrical efficiency was second. We knew we would have to develop our own farming technology and infrastructure to grow the plants, the software to operate the facility and automate many of the cultivation processes, and then the robotic equipment that manages the logistics of the farm: the inspection of the crops, the movement of different subsystems within the farm, and so forth.
We started the business three and a half years ago. We spent the first two and a half years developing the technology, and then in the first half of 2020, we built our first commercial farm. We call it Farm One, and it is located in a 6,000-square-foot warehouse in San Jose.
Q: Let’s talk about your business model. Willo’s members basically rent space within your farm on a subscription basis and decide what they want to have grown in that space?
A: That is exactly right. Basically, people will interact and control their farm shares through a mobile application. On a month-to-month basis, they can increase or decrease the size of their farm share, or “field,” by adding or subtracting beds, which are areas within the farm where specific crops are cultivated. The customers control what they want grown for them.
Q: What kinds of crops are grown in your farm?
A: We started with the leafy greens—the kales, the arugulas, the spinaches, the basils, the micro greens. They are productive plants and highly nutritious. We have also grown potatoes, strawberries, blackberries, blueberries, and cauliflower. We plan to continually introduce new categories of fruits, vegetables, and medicinal plants to our list of selections.
Q: How often do you make deliveries?
A: It depends on the subscription. It could be once a week or once every two weeks.
Q: What do the robots you developed do in the facility?
A: These robots handle the high-frequency, low-complexity tasks. That’s what robots are very, very good at. For example, our robots handle the planting of the seeds, the movement of the plants throughout the facility, and the visual inspection of the plants with high-resolution cameras. The next functions we will automate include the movement of lights around the facility, the cleaning of the infrastructure, the sampling of tissue, and the pollination of plants within the facility. So, eventually, we will have automated every single operation within the vertical farm through a single fleet of robots.
We are also automating the processes of harvesting and packaging, using off-the-shelf robots for both of these functions.
Q: How many robots do you have operating in the facility and how do they work?
A: Today, we have three robots that are operational inside of the facility, and the next facility will have something on the order of 11.
The vertical farm is two stories tall, and at the top of that vertical farm is what is called a heat island—it’s where all the heat rises up from the LED lights and from the plants as they generate heat. That all sits in about a four-foot area on top of the facility, and it is where the robots operate as well.
The robots travel around the facility on rails, and each carries a different “payload” that can be lowered to perform different functions, such as moving the plants, inspecting the plants, or moving the lights. We designed these robots so that their payloads can be dropped 40 feet or more, but we also built them in such a way that the distance could easily be extended. That is one of the best parts about our system—its ability to physically scale up, out, and side to side.
We have also developed our robotics system to be extremely modular, which gives us a lot of redundancy. If something goes wrong with one of these robots, it is not like a conveyor belt, where you have a single point of failure.
Q: How do you control all of this automated equipment?
A: We have an in-house software suite that monitors conditions to make sure the setpoints are perfect. The software manages all of the environmental input that the plant experiences, such as light, temperature, humidity, air flow, water flow rates, water pressures, droplet sizes, nutrient composition, PH levels, electrical conductivity … the list goes on and on.
Q: And you have plans to expand this technology to additional locations?
A: That is correct. We sold out the first farm in a matter of weeks. We will soon build a second facility, which will be located in Santa Clara, about eight minutes up the road. It will be a little bit over 10 times the size of our current facility and will offer significantly more in the way of production capacity. From there, we plan to expand to other cities.
Q: With your goal of alleviating world hunger, could your technology be deployed anywhere in the world?
A: That is the aim, but it won’t happen overnight. First of all, as with electric cars, this starts at a low-volume, high-price level, which is exactly where vertical farming must exist in the market today. As we continue to optimize operations within the farms themselves, production costs per pound will drop.
In our opinion, though, there are a number of other ventures where this technology could potentially be a significant disruptor. For instance, our technology allows us to analyze crops in ways that could lead to genetic breakthroughs with respect to feeding more of those 1.1 billion people who began this millennium malnourished, and help us grow plants for medicines and vaccines to keep those same people healthy. There is nothing in the world that would drive me harder as a human being than the idea of turning those two prospects into reality.
Congestion on U.S. highways is costing the trucking industry big, according to research from the American Transportation Research Institute (ATRI), released today.
The group found that traffic congestion on U.S. highways added $108.8 billion in costs to the trucking industry in 2022, a record high. The information comes from ATRI’s Cost of Congestion study, which is part of the organization’s ongoing highway performance measurement research.
Total hours of congestion fell slightly compared to 2021 due to softening freight market conditions, but the cost of operating a truck increased at a much higher rate, according to the research. As a result, the overall cost of congestion increased by 15% year-over-year—a level equivalent to more than 430,000 commercial truck drivers sitting idle for one work year and an average cost of $7,588 for every registered combination truck.
The analysis also identified metropolitan delays and related impacts, showing that the top 10 most-congested states each experienced added costs of more than $8 billion. That list was led by Texas, at $9.17 billion in added costs; California, at $8.77 billion; and Florida, $8.44 billion. Rounding out the top 10 list were New York, Georgia, New Jersey, Illinois, Pennsylvania, Louisiana, and Tennessee. Combined, the top 10 states account for more than half of the trucking industry’s congestion costs nationwide—52%, according to the research.
The metro areas with the highest congestion costs include New York City, $6.68 billion; Miami, $3.2 billion; and Chicago, $3.14 billion.
ATRI’s analysis also found that the trucking industry wasted more than 6.4 billion gallons of diesel fuel in 2022 due to congestion, resulting in additional fuel costs of $32.1 billion.
ATRI used a combination of data sources, including its truck GPS database and Operational Costs study benchmarks, to calculate the impacts of trucking delays on major U.S. roadways.
There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.
Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”
Kent, who is a senior fellow at the George H. W. Bush Foundation for U.S.-China Relations, believes the photograph is a good reminder that some 50-odd years ago, the economies of the United States and China were not as tightly interwoven as they are today. At the time, the Nixon administration was looking to form closer political and economic ties between the two countries in hopes of reducing chances of future conflict (and to weaken alliances among Communist countries).
The signals coming out of Washington and Beijing are now, of course, much different than they were in the early 1970s. Instead of advocating for better relations, political rhetoric focuses on the need for the U.S. to “decouple” from China. Both Republicans and Democrats have warned that the U.S. economy is too dependent on goods manufactured in China. They see this dependency as a threat to economic strength, American jobs, supply chain resiliency, and national security.
Supply chain professionals, however, know that extricating ourselves from our reliance on Chinese manufacturing is easier said than done. Many pundits push for a “China + 1” strategy, where companies diversify their manufacturing and sourcing options beyond China. But in reality, that “plus one” is often a Chinese company operating in a different country or a non-Chinese manufacturer that is still heavily dependent on material or subcomponents made in China.
This is the problem when supply chain decisions are made on a global scale without input from supply chain professionals. In an article in the Arkansas Democrat-Gazette, Kent argues that, “The discussions on supply chains mainly take place between government officials who typically bring many other competing issues and agendas to the table. Corporate entities—the individuals and companies directly impacted by supply chains—tend to be under-represented in the conversation.”
Kent is a proponent of what he calls “supply chain diplomacy,” where experts from academia and industry from the U.S. and China work collaboratively to create better, more efficient global supply chains. Take, for example, the “Peace Beans” project that Kent is involved with. This project, jointly formed by Zhejiang University and the Bush China Foundation, proposes balancing supply chains by exporting soybeans from Arkansas to tofu producers in China’s Yunnan province, and, in return, importing coffee beans grown in Yunnan to coffee roasters in Arkansas. Kent believes the operation could even use the same transportation equipment.
The benefits of working collaboratively—instead of continuing to build friction in the supply chain through tariffs and adversarial relationships—are numerous, according to Kent and his colleagues. They believe it would be much better if the two major world economies worked together on issues like global inflation, climate change, and artificial intelligence.
And such relations could play a significant role in strengthening world peace, particularly in light of ongoing tensions over Taiwan. Because, as Kent writes, “The 19th-century idea that ‘When goods don’t cross borders, soldiers will’ is as true today as ever. Perhaps more so.”
Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.
That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.
As a part of the 2021 Infrastructure Investment and Jobs Act, the BABA Act aims to increase the use of American-made materials in federally funded infrastructure projects across the U.S., Hyster-Yale says. It was enacted as part of a broader effort to boost domestic manufacturing and economic growth, and mandates that federal dollars allocated to infrastructure – such as roads, bridges, ports and public transit systems – must prioritize materials produced in the USA, including critical items like steel, iron and various construction materials.
Hyster-Yale’s footprint in the U.S. is spread across 10 locations, including three manufacturing facilities.
“Our leadership is fully invested in meeting the needs of businesses that require BABA-compliant material handling solutions,” Tony Salgado, Hyster-Yale’s chief operating officer, said in a release. “We are working to partner with our key domestic suppliers, as well as identifying how best to leverage our own American manufacturing footprint to deliver a competitive solution for our customers and stakeholders. But beyond mere compliance, and in line with the many areas of our business where we are evolving to better support our customers, our commitment remains steadfast. We are dedicated to delivering industry-leading standards in design, durability and performance — qualities that have become synonymous with our brands worldwide and that our customers have come to rely on and expect.”
In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.
Both rules are intended to deliver health benefits to California citizens affected by vehicle pollution, according to the environmental group Earthjustice. If the state gets federal approval for the final steps to become law, the rules mean that cars on the road in California will largely be zero-emissions a generation from now in the 2050s, accounting for the average vehicle lifespan of vehicles with internal combustion engine (ICE) power sold before that 2035 date.
“This might read like checking a bureaucratic box, but EPA’s approval is a critical step forward in protecting our lungs from pollution and our wallets from the expenses of combustion fuels,” Paul Cort, director of Earthjustice’s Right To Zero campaign, said in a release. “The gradual shift in car sales to zero-emissions models will cut smog and household costs while growing California’s clean energy workforce. Cutting truck pollution will help clear our skies of smog. EPA should now approve the remaining authorization requests from California to allow the state to clean its air and protect its residents.”
However, the truck drivers' industry group Owner-Operator Independent Drivers Association (OOIDA) pushed back against the federal decision allowing the Omnibus Low-NOx rule to advance. "The Omnibus Low-NOx waiver for California calls into question the policymaking process under the Biden administration's EPA. Purposefully injecting uncertainty into a $588 billion American industry is bad for our economy and makes no meaningful progress towards purported environmental goals," (OOIDA) President Todd Spencer said in a release. "EPA's credibility outside of radical environmental circles would have been better served by working with regulated industries rather than ramming through last-minute special interest favors. We look forward to working with the Trump administration's EPA in good faith towards achievable environmental outcomes.”
Editor's note:This article was revised on December 18 to add reaction from OOIDA.
A Canadian startup that provides AI-powered logistics solutions has gained $5.5 million in seed funding to support its concept of creating a digital platform for global trade, according to Toronto-based Starboard.
The round was led by Eclipse, with participation from previous backers Garuda Ventures and Everywhere Ventures. The firm says it will use its new backing to expand its engineering team in Toronto and accelerate its AI-driven product development to simplify supply chain complexities.
According to Starboard, the logistics industry is under immense pressure to adapt to the growing complexity of global trade, which has hit recent hurdles such as the strike at U.S. east and gulf coast ports. That situation calls for innovative solutions to streamline operations and reduce costs for operators.
As a potential solution, Starboard offers its flagship product, which it defines as an AI-based transportation management system (TMS) and rate management system that helps mid-sized freight forwarders operate more efficiently and win more business. More broadly, Starboard says it is building the virtual infrastructure for global trade, allowing freight companies to leverage AI and machine learning to optimize operations such as processing shipments in real time, reconciling invoices, and following up on payments.
"This investment is a pivotal step in our mission to unlock the power of AI for our customers," said Sumeet Trehan, Co-Founder and CEO of Starboard. "Global trade has long been plagued by inefficiencies that drive up costs and reduce competitiveness. Our platform is designed to empower SMB freight forwarders—the backbone of more than $20 trillion in global trade and $1 trillion in logistics spend—with the tools they need to thrive in this complex ecosystem."