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Indoor Farming Hits the Windy City

posted on April 25, 2014


Many entrepreneurs rely on business incubators to accelerate the growth and success of their companies.

The National Business Incubation Association boasts of more than 1,400 members in the United States -- and a total of 1,900 members in 60 nations around the world.

The incubators vary in their strategies. While some operate on a virtual basis, others feature an actual physical space meant to foster networking and sharing of common goals.

A case in point can be found on the south side of Chicago where entrepreneurs have refurbished an abandoned meatpacking plant into an incubator that produces “greens and gills.”

David Miller explains.

Snow on the ground in the Midwest is usually a clear signal that fresh, locally grown produce is no longer available. But for some residents of Chicago the supply never dries up, even during the most inclement weather.

On the Southside of the Windy city, David Ellis and his business partner Eric Roth have joined several entrepreneurs who are pushing back against Old Man Winter.

David Ellis, CEO, Greens & Gills: “This all started with a vision for capitalizing on a need in the marketplace and that need was locally sourced produce.  What we saw was just that there was a demand for it and that demand was only growing, at an all-time high and only growing and in the Midwest the source for it was very minimal, almost non-existent other than the summer months.  So for a year-round production company there was a gap in the marketplace that we felt we could capitalize on.”

To take advantage of that gap, the pair, along with a silent partner, invested more than $150,000 of their own money to market microgreens, leafy vegetables and fish under the name Greens & Gills.

Their secret weapon against bad weather stopping food production is aquaponics – a closed-loop system that uses water cycled between fish tanks and plant beds. To maximize the use of their 4,500 square feet of space, a portion of the product is grown on shelves adding a vertical component to the operation.

Being located in Chicago, orders for fresh greens can be filled in as little as a few hours while the fish are ready for sale every 6 weeks.  Selling the greens has actually been easier than the fish because chefs in the metropolitan area have difficulty balancing the purchase price against the cost of processing.

Greens & Gills is the first licensed aquaponics farm in the city of Chicago and just celebrated its first anniversary in January. But long before the first pipes were connected, Ellis poured two years into research and development.

The pair credits some of their success to a distinct division of labor.  Roth handles nearly all of the production while Ellis oversees marketing.

David Ellis, CEO, Greens & Gills: ”...we needed to kind of check our egos at the door, realize that there's certain areas in business that we could, we excel at and certain areas where we probably fall a little short.  And the idea, and I think it's important for any business, is to recognize those and bring in the team that can really hit on all of those areas.”

The produce from Greens & Gills’ vertical fields are marketed through a food distributor as well as directly to upscale restaurants located in Chicago’s downtown business loop.

David Ellis, CEO, Greens & Gills: “Chefs sometimes can be hard to get in touch with but it's on me to just cold call them.  I walk in the door, I come in with a cooler with microgreens and fresh cut basils and French sorrel and lettuces and generally their first inkling is, oh another vendor calling on me to try to get another product in here.  ....-- my opening line is, ‘I'm David Ellis. I co-own and operate an indoor urban farm right here in Chicago,’ They're usually pretty receptive to at least see what I have and do a tasting and talk from there.”

The chefs at Siena Tavern were one of Greens and Gills first customers.

Kevin Abshire, Chef d'Cuisine, Siena Tavern: ”...texture, flavor, appearance, everything start to finish is phenomenal. So every now and then, Dave will come around and it's just that, it's that one-on-one interaction with the farmer that goes that much further. “

Greens & Gills is located in an unlikely place - the basement of a remodeled meat packing plant. There are seven entrepreneurs like Ellis taking advantage of this green business incubator located on the Southside of Chicago called The Plant.

John Edel, Executive Director, The Plant: ”Here in Chicago, the average vegetable has gone 1,500, maybe 2,000 miles to get here.  That's silly.  We have a talented workforce just on the other side of these walls.  We have all of the resources that we need right here in Chicago, lots of fresh water and this is where the food is consumed.  So why are we transporting it?  So The Plant exists to figure out new ways to not only grow food in the city but also how to process it in an efficient way.”

The Plant is John Edel’s second business incubator. A former television art director, Edel has devoted more than a decade to helping innovative entrepreneurs get their start.

The nearly 95,000 square foot structure was purchased by Edel in 2010 for $250,000. With the help of friends and volunteers, he was able to get things started.

Edel’s grand plan is to have the tenants create products, process the waste from those products, or provide power for the building in a closed energy loop.

John Edel, Executive Director, The Plant: “I never see a building as a dirty old building.  I walked in and I saw floor drains and I saw the concrete structure and I saw the beautiful brick work and I said, 'Well, all mechanical systems may be scrap metal but you have the core, you have some of those expensive and important pieces.' ” 

The concept of growing locally sourced food appealed to Urban Canopy owner Alex Poltorak. The young entrepreneur began volunteering at The Plant nearly 4 years ago and decided the innovative incubator would be a good place to start a business. 

After investing $100 in some wheat grass seeds Poltorak began selling product out of his home to area juice bars.  In 2011, he brought his new business to the basement of The Plant and eventually moved upstairs to a 700 square foot vertical farming space.

Alex Poltorak, CEO, Urban Canopy: “We call it a for-purpose business.  So in the eyes of the IRS it is still very much a for-profit business that they tax but at the same time the way we measure ourselves and what we try to do as a business is very much socially oriented. There's a purpose of ‘how do we feed people, how do we create those economic benefits to the community and how do we improve community wealth and health’ and stuff like that.”

Poltorak handles all the production and four full-time employees handle distribution. He continues to sell wheat grass to juice bars while the rest of the products are sold to members of his community supported agriculture project and a few restaurants. Poltorak says Urban Canopy is making money but the profits are plowed back into the operation.

Alex Poltorak, CEO, Urban Canopy: When I take a step back I really love it.  On a day-to-day it's still very hard.  And it is in this phase of growth that is also difficult to manage.  ...And for me it is definitely very stressful and challenging...  But when I look back on what collectively our crew has accomplished over the last few years it is astonishing and there's still a long, long way to go.  So it's exciting to see.”

Poltorak and Ellis plan to stay at The Plant indefinitely to supply fresh, locally produced food to Chicago consumers year round. But there is still plenty of space for a few more small businesses to pull themselves up by their bootstraps helping Edel get one step closer to his dream.

For Market to Market, I'm David Miller.


Tags: Alex Poltorak aquaponics David Ellis Greens & Gills John Edel Kevin Abshire Siena Tavern The Plant Urban Canopy vertical farming