S8E99: Gabriel Zarafonitis / FarmAnywhere - The Challenges and Philosophy Behind a Thriving Vertical Farm Solution

Harry Duran: 0:00:00

You're. Gabriel Zarafonitis, president founder of Farm Anywhere. Thank you so much for joining me on the Vertical Farming podcast.

Gabriel Zarafonitis: 0:00:11

Thank you. Same same here. It's a privilege.

Harry Duran: 0:00:14

Yeah. Thanks again. I think the listener will get knows by now there'll probably be some mention of cultivated because they seem to be the connector for all things related to this show. Not only being a sponsor, but we first met in Dubai. It's so funny to meet people from North America, but you meet them on the other side of the world. And we were both there for Agrami Conference, but maybe you start there. How did you end up there and what was that story like?

Gabriel Zarafonitis: 0:00:46

Well, all I can say is what a ride it's been, right, yeah. To get there to that point, all the way back to the original beginning, I guess you can say. Yeah, it was a lot of different struggles and a lot of learning at the same time as all too. That really translates into what we had at Acronym in terms of presentation and product there. It's a long journey that keeps on going and is extremely satisfying, though I think probably one of the best journey you can have in a lot of careers, I would say.

Harry Duran: 0:01:24

What was your biggest was that your first time in the region or had you been there before?

Gabriel Zarafonitis: 0:01:28

First time in the region, yeah.

Harry Duran: 0:01:30

Okay. So it was the first time for me as well. Just that part of the world. So it was a lot to take in because you're trying to figure out what the vibe there in Dubai itself. And then the conference was showing all these opportunities. I've talked ad nauseam on the show about how much food gets imported there. But if you had to think about what were some of the big takeaways specifically from that trip and being in that region, what was that like for you?

Gabriel Zarafonitis: 0:01:58

One main takeaways was the acute understanding from the citizens, the local people, about the predicament, I guess, that they're in, and the insane desire to find a solution quickly to that problem. Right. That was like constant team as we know what the problem is. What can you offer us? What's your solution? Has it been tested before in the desert? What makes you different? Like, very pinpointed question, and basically they would just move on to the next and move on to the next boot. And you could see them coming your way almost down the aisle, so you could see the eagerness in them.

Harry Duran: 0:02:47

Did you refine your pitch as you were having over the two days?

Gabriel Zarafonitis: 0:02:51

100%? Yeah. One thing that really I mean, we've done pitches in Canada, in the US. So you go in thinking that your pitch is as refined as it gets, and then you quickly find out that the need is so different and that the goals, the end goal is so different as well, too. That the questions and the KPIs, so to speak, moves and then you have to adapt quickly to give them the information that they want.

Harry Duran: 0:03:23

Yeah. And so rewinding the clock back a little bit. Your background is more in project management. Is that where you started your career?

Gabriel Zarafonitis: 0:03:31

Not even, yeah, my background goes back to my first company when I was 14 doing window cleaning. Yeah, actually quit high school to go do it and home school myself, the rest. So progression of different companies from there on didn't grow up with any means, you could say. So there was quite a bit of fire in there. Right. So went from window cleaning to cleaning, then eventually to a tech company with one of our customers that really liked that solution that we had built. So they completely bought the tech company out and that tech company was a little bit detrimental to the worker in terms of their well being, so to speak, because a lot of tracking and a lot of things like that was happening. So on the next venture I said, well, this one I got to do something that actually makes a difference that will move the needle for the planet. Back then it was quite popular with big jobs saying if you do something, do it so that you could change the world. So kind of being a bit of inspired by that there. So that's how I got into self taught myself. Vertical farming, indoor agriculture and back then we had very fundamental equipment like just Raspberry pi's to be able to control your lights because there was really nothing else unless you wanted to go with controllers with like Siemens for example. But that was on another level in terms of cost too. So basically it was a lot of Jimmy Rigging spending time on the beginning stage of Reddit, really back then. And then YouTube, obviously, which is like the main point where we get a lot of information, I guess.

Harry Duran: 0:05:15

Yeah, I think people who are new to an industry, it's almost like the default and I think people don't take into account how much you can learn on YouTube and what a resource it is. Even just if I think about the podcasting space, like when I started, there was some YouTube, but if you think about this world, when I was growing up, the internet was a big deal. But even when the internet came up, YouTube took a while to come online and I think the speed at which you can learn and almost like not make the mistakes that other people have made by watching people on YouTube has been pretty crazy. So it's interesting to see how quickly you can grow and how quickly you can learn a skill set and be well versed in an industry just from YouTube nowadays, which I think a lot of people sometimes take for granted.

Gabriel Zarafonitis: 0:06:03

Yeah, not only that, but the creators on YouTube, they have those discord channels as well too, and those private groups, right? So not only you're learning super quickly with all the different resources, but then you have access also to that little tiny community on the back end that follows that creator. And then you can glean a bit more. Like I did this experiment, like for example, one of our container farms is mushrooms, right? And mushroom is still an infancy, you could say, compared to leafy greens. So the importance for us to stay on top of things and see what the community is doing and getting feedback from that, then that's exactly where the best information is. By someone just practicing fruiting some mushroom blocks in their basement, really, and just kind of getting information and us at the same time too, sharing that information back. Say we're not growing in a basement, we're growing maybe in a bit more controlled environment, but that's what we're seeing with this particular type of equipment. For example.

Harry Duran: 0:07:08

Yeah. You're in Montreal, is that correct?

Gabriel Zarafonitis: 0:07:12

No, I'm in Vancouver.

Harry Duran: 0:07:13

You're in Vancouver. Sorry. And then where did you grow up?

Gabriel Zarafonitis: 0:07:16

I grew up in Montreal.

Harry Duran: 0:07:18

Yeah. Okay.

Gabriel Zarafonitis: 0:07:19

About five years ago I moved to Vancouver.

Harry Duran: 0:07:22

Okay. And what was life like growing up in Montreal? I'm curious about this entrepreneurial drive that you have. Is that more of like, culture? Is that more of your environments? Where does that come from?

Gabriel Zarafonitis: 0:07:36

Well, I think for sure environment played a big role just because it was a need, right? It was a need to create revenue, it was a need to move. So I guess they did a bit of that drive also. I wasn't that great at school as well, too, so that was an extra. I was a bit daydreaming and venting things, playing with Legos as well, too, earlier on, right. So it wasn't really my thing. I guess school now it is a bit more, right. But always being self taught. So I guess that was like the drive and then I guess the entrepreneurial spirit. My grandpa had restaurants as well, too, being Greek in Montreal, so maybe that got transferred to DNA, who knows? Yeah, but for sure there was a natural tendency to go that path, let's say.

Harry Duran: 0:08:30

Are there any good Greek diners in Vancouver?

Gabriel Zarafonitis: 0:08:35

I haven't been back that much, no. Anyways, from what my grandpa keeps telling me, the heyday of the really real Greek food coming from Greece through immigration has kind of passed a little bit and it's been diluted in with, for example, Italian food and Arabic food as well too.

Harry Duran: 0:09:01

I love Greek cuisine. And I grew up in New York, and I lived in New York City, so definitely, like, in Astoria, Queens. No shortage of Greek diners and Greek food. And there's something specifically about that aspect of Mediterranean like food and culture, that it's got its own taste. And as I'm sure you all know. Were you born in Greece?

Gabriel Zarafonitis: 0:09:22

No, I was born in Winchell.

Harry Duran: 0:09:24

Okay.

Gabriel Zarafonitis: 0:09:25

So it's basically my grandpa that came from Greece when he was 14.

Harry Duran: 0:09:29

Okay. And do you still have family there? Do you ever go back?

Gabriel Zarafonitis: 0:09:33

So apparently we do have some family there. I've never been to Greece yet. Imagine that. Been to 30 countries now. Had the goal to do 30 countries under 30.

Harry Duran: 0:09:45

Okay.

Gabriel Zarafonitis: 0:09:45

I just refilled my age there by.

Harry Duran: 0:09:47

Accident.

Gabriel Zarafonitis: 0:09:51

But it's definitely on the bucket list to go to Europe more and go see where my grandpa grew up as well, too. That would be cool.

Harry Duran: 0:09:58

And when you go, I'll introduce you to a previous guest. I'll pull up his name, but he's in Greece and he's doing vertical farming there as well. That would bring it back full circle.

Gabriel Zarafonitis: 0:10:14

Yeah. Any vertical farm that I can visit, I'm down for as well, too. I'm big on sharing of information, maybe even down to the point where everything should be open source, I guess.

Harry Duran: 0:10:28

Yes.

Gabriel Zarafonitis: 0:10:29

So I would love to see a farm in Greece or anywhere else in the world, for sure.

Harry Duran: 0:10:34

Yeah. Christos Rafio Giannis. That's his name. From City Crop.

Gabriel Zarafonitis: 0:10:38

From City Crop. Okay, cool.

Harry Duran: 0:10:40

Yeah.

Gabriel Zarafonitis: 0:10:41

I'll let you know when we have the tickets booked there.

Harry Duran: 0:10:45

So you started farm anywhere, like you were saying, some of that early technology, 2016, I think, is when you started. Right. What were you seeing that had you excited about the space? Because it's still early, and even now we're feeling like this is like I don't know if this would be considered a second wave or a third wave in terms of vertical farming, but what was it that you saw back then that got you excited about the opportunity?

Gabriel Zarafonitis: 0:11:15

It was actually a Ted Talk that inspired me. The MIT Open Lab and one of the researchers there or one of the directors there was kind of experimenting with. And he had the analogy between a food computer, a food server, and then you would have some local food production and a bit bigger and a little bit bigger. And it was something that inspired me almost right away into looking into it a bit more, especially with the tech background. Back then, I would say, okay, well, if I'm going to do it, I'm going to do like, ultra high tech. Right. That's high tech as it gets. Which turned out to be a big problem. That was, I guess, hard mistakes to learn, especially 2017, 2018, the years to come after that. Quite ambitious, so to speak. But also that's a big part of the DNA as to what farming aware is now is because of those early years of I guess now we would say, like, we're in the flip phone stage of EA. And back then we were probably at the fax machine putting things together and just waiting for things to come back because the data, we couldn't export it. We had to use USB sticks and then stick them in the computer to get the data, right. We couldn't see it live yet and things like that.

Harry Duran: 0:12:35

What was the model back then and how has it changed in terms of what your offerings were when you started?

Gabriel Zarafonitis: 0:12:42

Yeah, so back then, right away we went like, okay, we're going to do ultra high tech, we're going to make our own lights, we're going to make our own controllers. Well, we didn't really have a choice for making our own controllers, actually, so that was a necessity, so to speak. And we're also going to roboticize the whole thing. Another thing, too, I'm a big fan of shipping container farms as well, too, just because quick to expand, easy to move around, if ever, and hyper local farming, right, which is still great, obviously, that's what Farm Anywhere does. But I do think that there's still a space for traditional vertical farming inside buildings, for example, and all that. There's not a one size fit all, but back then, we weren't doing anything that has to do with buildings. It was 100% in containers. We're using reefer containers as well, too, which has a whole host of other problems as well. And then we found out pretty quickly that one, robotics is expensive and it's plagued with issues also. Another thing, Too was, okay, making your own controller is great, but then you have to be able to support those. You got to be able to have the parts for all those as well, too. So when you start expanding the farms and all your clients as well too, that are operating these farms, you got to be able to support all these farmers. And then at the end of the day, you become responsible for their well being as well, because literally their farm is in your hands. So if you can support the controllers, if you can't support your robotics, then they're literally in trouble, right? Not just financially, but like a farmer.

Gabriel Zarafonitis: 0:14:18

Got to think about it a little bit as a pyramid as well, too, as an equipment manufacturer, we're at the top of the pyramid because we're building the tech that people are using.

Harry Duran: 0:14:28

Right.

Gabriel Zarafonitis: 0:14:28

Underneath that is all the farmers, and then all the farmers, they're working hard to be able to produce the food that's needed. And then after that, you have all of the people that rely on that farmer to produce food, right. So your trickle down effect is literally ten x every single time. So if you have a farm that goes offline, really, you stop producing food for maybe 10, 15, 20,000 people. So I think that when startups start and doing the marketing before they even have an actual product, and they push out product that hasn't been tested yet. It's not just a farmer that has the consequences of that, it's also everyone else that relies on that food.

Harry Duran: 0:15:10

Yeah, that's a good point, because farmers, they get into it. I would imagine a lot of them, because they come from a farming background or they're interested in like the business of farming and getting the product, growing the product and selling it. You start getting into the technical aspects of like, maintaining software and looking out for updates and all the moving parts behind the scenes. It starts to, I would imagine, overwhelm them, if that's not their expertise and if they begin to rely too heavily on tech to get what they need done. One little misstep or one little hiccup or something, one little update that didn't go right in the firmware or something along those lines. Thinking about the tech issues, they start to become. It's a really fragile part of the chain.

Gabriel Zarafonitis: 0:15:58

100%. It's just a question of flicking the wrong switch on the software side and get a call real quick. My HVAC isn't turning on right. Why is that happening? For sure, and it's not necessarily because the end user is necessarily not tech savvy, but the farmer is not just operating technology in the background like an It department at an office, right? They're harvesting, they're selling, they're packing, they're cleaning, they're following gap practices and all that. So it's easy to just turn around while you had your box, your finger just touch the screen on the way out, right? And all of a sudden you change something and you didn't realize it because you're just packing things, getting ready to be able to deliver the food. So definitely having anything built around tech centric in terms of food production, not only does it have to be user friendly, but it has to be a little bit bulletproof in the sense that you can quickly go back and diagnose an issue if there is. And if anything, the way our philosophy here for building our tech is that if the controller cannot do it on the software side, there's got to be a physical way to do it and bypass the controller. So either it's like you plug it in straight into the wall and you bypass the relay, right, or all kinds of different systems like that so that you could have a physical backup if something happens. And also for the end user, it just helps them be able to troubleshoot issues as well, too, because they can take that tech aspect out of the way and just make sure that the physical aspect is working properly first before they go towards the software side and so on and so forth.

Harry Duran: 0:17:35

Yeah, that's definitely important. I definitely want to dive into a little bit of the tech in a second. But when you first looked at the model and you looked at your bit, specifically your business model, did you know from day one that you did not want to be in the business of actual farming and be more of the provider and helping people on the tech side?

Gabriel Zarafonitis: 0:17:56

So I guess you could say, like, there's a farm manure 1.0 and there's a farmer 2.0. Right?

Harry Duran: 0:18:00

Okay.

Gabriel Zarafonitis: 0:18:01

So the 1.01 was we're going to be 100% manufacturer of the tech, right? From technology to life to robotics and all that, which cost us dearly. The company failed, right? Had to close down. And then for a period of about three years, I was just kind of floating as a consultant, working on different projects, working for other companies, doing designs for them and things like that. And it's only during the COVID era when we really had a lot of train into the industry in terms of the food production industry that went back into farming, where 2.0 you could say. And now the philosophy was completely different. It was, we will practice what we preach. So therefore we have a farm in our facility that we grow food in that people actually consume. So mushroom Farm and a leafy green farm that also doubles as an R and D facility. So we could test out things here and there and also by practicing what we preached. And we can give proper advice to potential customers. Yes, this will work and this will not work because Container Farm is not the end all be all right. It works in certain aspects, but it doesn't. So by us being in an urban area but a little bit out the outskirts of Vancouver, we have a really good idea of what makes sense and what doesn't make sense in that part.

Gabriel Zarafonitis: 0:19:20

And therefore we're getting a lot of feedback like that from our own operation as well. And also that doubles as a school as well. So when you get a container from Farm Anywhere, you could come to our facility and get trained. We'll even throw a little bit of booby trap here and there in the containers to help you try to diagnose. Okay, this is what it is. Pinch a quarter inch tubing, for example, to stop one of the emitters, things like that, just to test out. So it really became 2.0 really became farmer centric. How can we build a solution that is a tool and not a crutch to the end user and that they're not necessarily tech savvy or they're really tech savvy, but not necessarily farmers to try to find a good balance in between that and really all that became from literally just exploding the first version of the company. I guess you got to break things to be able to figure out sometimes your mistakes and then get a reality check, I guess.

Harry Duran: 0:20:18

Yeah, absolutely. So for folks that are not familiar with the Farm Anywhere offerings and the model, can you talk a little bit about what that looks like? Do you provide all in completely set up containers components or just kind of walk people through who you currently serve and what the current offerings are?

Gabriel Zarafonitis: 0:20:39

Yeah, so when I look back into starting 2.0, basically what I decided to do was to, okay, we don't need to reinvent the manufacturing process that's been proven out, and then we also have the example of Tesla, for example, that can quickly iterate under software, not the software under hardware, parts and software as well. And then you have the other side of the spectrum, like Boeing or Lockheed Martin that has huge operations or car companies, right? So I kind of took the time to study a little bit about each of the business models and how the manufacturing part worked. And one thing is always certain between all of them is that they all have a base model. So they have a base, let's call it the Se model, the light model. So we call it like the universal light farm. And that's like a combination of the last years of me working on different projects where I found like a sweet spot of a farm that's a light shell has all the equipment in it that you need and that we produce at scale. So it allows us to be able to use all the economy of scale that you have in the normal manufacturing process. So we build those and then once we get an order for that farm, also it allows us to keep that container in stock, right, that farm in stock. So a lot of people turn to shipping containers because of speed to market versus like having to pull permits on a regular building and all that. That takes a long time so that we have in stock. So if you want, you can purchase just the light farm. And the light farm has HVAC, electrical, plumbing, everything that you need to kind of get going. And then you could outfit it with your own equipment. So you have an existing greenhouse, for example, with a bunch of nursery cards and you wanted to take an extra space out of your nursery and just have a nursery room in the container.

Gabriel Zarafonitis: 0:22:29

You can, you could just have that if you want. And that's quite affordable as well too, in terms of pricing. And it's faster, like literally the next day we could ship it out if you're that much in a need, right? And then from there, from that base, then we opted it with the discipline of the farmers. So either it's mushroom production, leafy greens we're getting a lot of research, R and D as well too, from universities or private corporations looking to do feed breeding, governmental agencies as well too. So that has a bit more specialized equipment, not really focused on making a profit, but more focused on really tight controls. And the way we build a container is with an integrated HVAC system as well too. So there's a full duct in there with UV lights, with Merv 13 filters. It allows us to really have 0.5 degree difference between the front and the back of the container, which was a big problem in the past with containers, with it being so long and narrow. And they love that for being able to really be able to test out different theories on their crop and the offering keeps on going from there and we're always looking to fulfill the need if there is. And in our troll R and D there, we're testing out a few different methods to be able to fulfill the need somewhere else, but always following the principles that we've been talking about. So that's the offering. And then we also have a blooming side division, I guess too which is just regular agricultural equipment as well. Too like an irrigation skid, probably the most compact irrigation kit you can get, comes with tank dosers pump and it's within 30 inch by 30 inch, so it's really small, up to 150 gallons. So it was built for a container, right, because of the tight environment, but why not offer it to everyone else, even other shipping container farm companies, if they wanted, they're more than welcome just to help the market out.

Gabriel Zarafonitis: 0:24:25

And we're going to be developing that future in the future as well. Too.

Harry Duran: 0:24:30

Yeah, it sounds like with all the experience you had having to retrofit or create or maintain equipment specifically for that container farms, it seems like the more you do that, the more you become subject matter experts in terms of the limitations, even just that designation of the change in degrees from the front to the back of the unit. The more time you spend in that space. It's almost like you start to know the space so well. And you know what works in that space? What doesn't? From crops, from tech, even to the irrigation. And so do you feel like that's what's been happening? The more experience you have, the more clients you have and the more questions you have about the limitations of that space, the more you start to understand what's possible and what you can do there.

Gabriel Zarafonitis: 0:25:22

Yeah, definitely the feedback from our customers as well too that also some of them, they like to experiment, right, themselves. So say, hey, here, we tried to do this and it didn't really work out or it worked great, right. So also because we're really open as a company, even to the point where eventually I'd like to maybe even go to the open source kind of model, it goes both ways with our customers. When they contact us, we're super open about how things are done, why we're doing them in a certain way, and then that kind of gets back to us as well. Too when they start operating the farm, they're super open about sharing their information about what trials they've done and all that. And in terms of manufacturers, a lot of them say if you use the container in a way that is not meant, you void your warranty, right? And then it basically stops the customer from giving you feedback because they're scared that you're going to void the warranty if they break something, right? And us, it's the opposite because we use only off the shelf part, we don't develop anything. We do system integration, right? So the process, we put it all together and we don't need to do tech ourselves, for example, on the controller side, because now there's a bunch of companies doing that tech. So let's just take the best technology possible that's the simplest and easiest to maintain. Let's implement that to the container. And if the end user or farmer breaks that controller, it's not us that has like, we will help you with the warranty, but at the end of the day, it's the manufacturer of that controller that will warranty it, right? So it allows us to have a special relationship kind of with our customer in that sense too and quick feedback and a lot of collaborative work as well, too.

Harry Duran: 0:27:03

I'm glad you brought that up because it's something that doesn't get talked about a lot. I think people are always concerned about proprietary systems and trade secrets and obviously people copying designs. And I think this talk of open source coming from the tech and the software background, which you've had experience in, why is that approach important for you and why that's something you've adopted?

Gabriel Zarafonitis: 0:27:30

Well, two reasons. The first reason is that at the end of the day, if you're so worried about your patents and your proprietary tech and all that, really the only person that it is detrimental to is the farmer because it's harder for them to fix the unit. It's harder for them to get parts for the unit as well, too. If a company and we've had a bunch of examples of that, if a company goes bankrupt and they have a bunch of proprietary lights and a bunch of proprietary controllers, it's the farmer at the end of the day that pays the consequences. Just a quick Google and you'll see a bunch of examples on that. So that's the one reason why I think us being able to use open source parts, not open source parts, but off the shelf parts that can be quickly acquired tomorrow morning is important in that sense. And then the second part too, is because of the whole tech industry, VCs were looking for tech, right? They were looking for that's how they make money. So the companies were extremely incentivized to have proprietary tech so that they could raise their next series A or their Next series B, and that also became detrimental to that. So there's a few companies out there that do it really well. Let them do well. They do lights well. Great, excellent. If you have amazing lights, I want to hear from you, right. We will implement them.

Gabriel Zarafonitis: 0:28:51

If you make amazing controllers, I want to hear from you. If you do amazing dosers for your Fritigation, I want to hear from you. You do that great. Focus on that. Make it your baby, make sure that it's the best in the world and we'll implement it for the end user and another. Thing. Part two. Another part that I want to add about the whole patent thing and being super secretive about everything that you do is that if you're so busy with your secrecy and all that, it means you have to have a big team, right? You have to have a huge dev team and a huge mechanical engineer team, because you're doing everything from zero when technology already exists, and that trickles down to the cost of your product as well. Too and it also trickles down to, as we've seen lately, mass layoffs. When that money runs out, right, when the VC stops writing you a check, there's only so much you can take, especially in the vertical farming industry with 15, 20,000 employees. Maybe not that much, but I'm going off maybe a bit more traditional tech here. But it's expensive to be able to run all of these projects internally, and if the technology already exists, we shouldn't have to redo it from scratch. And the market is big enough. That's the reality as well.

Gabriel Zarafonitis: 0:30:05

Too right. I don't know, maybe if you're in a competitive industry like aerospace, with Boeing and Airbus, where there's only two companies, you could see how that's quite cutthroat business right there in terms of proprietary information. But the need is so great at this moment to be able to have food produced around the world that if you have a good product, there's more than enough space for everyone.

Harry Duran: 0:30:32

And I think that's what I've seen as a consistent story with this idea of all hands on deck. It's an important moment that everyone is involved. There's not time to have this competition mindset as opposed to cooperation mindset. And I think I love the idea of supporting the farmers and having that be the basis for your decision making. Right? Because I think I heard something on the podcast last week about Ford, right, when he created the Ford Model T, those first models, I think you could repair anything with home tools, like, I think, wrenches and something like that. So it was interesting because it was this idea of like there wasn't the infrastructure that's in place now and all these proprietary parts and all that stuff, but just that idea that at any point, and even me growing up. My dad taught me how to change the shocks on a car and change the oil in the car and just kind of the basics that everyone needs to know. But nowadays they're so fancy and so many computers and electronics, and it's overwhelming. Like, most people wouldn't even open the hood of their car now because they're just like, there's too much in there. It's overwhelming. And I think there's something to be said for being able to just lift up the hood of your farm and just say, hey, what's wrong? How can I fix it? And I love the fact that you build in a couple of these tests in the beginning to get people comfortable with just, like, rolling their sleeves up and just diagnosing their own problems.

Gabriel Zarafonitis: 0:32:01

You can never break it too much, right? You could always fix it. There's always a backup somewhere, and it gives them confidence to be able to tinker a little bit. Like the perfect example of cars being extremely complicated now and you don't want to touch that anymore. Too much tech.

Harry Duran: 0:32:19

Yeah. So I'm curious, when you think about container farms and the conversations I've had. Gabriel I think about it as three different phases. There's the brand new farmer just getting started with their first container farm and then the one who's had some success, and then they're looking for, like, add ons, figuring out how to scale that. And then probably the other one would be partnering with a grocery store with a hospital and then seeing maybe the hospital itself saying, hey, we need something, we want to try this out. Research R and D is something you mentioned as well. So when you think about that mix, is there another phase that I haven't thought about? And where are you seeing in terms of the folks you're doing business with along that spectrum? Like, how are people engaging with you?

Gabriel Zarafonitis: 0:33:08

There's no doubt that probably compared to the greenhouse, for example, industry, or maybe traditional indoor inside warehouses, for example, we get a lot more of beginner growers, right. Someone that comes from a corporate background, for example, sick and tired of doing nine to five and wants to do something different. So for sure our ratios are greater on that part. So it's a responsibility for us as well, too, to educate them properly. And have, I think, what we're seeing as well, too, from customers that are shopping around between different manufacturers, the ability for us tell them, you know what? This may not work for what you're doing, compared to what we're hearing is like, oh, yeah, everything will be amazing. It's the best tech ever, right? Type thing. Plug and play. Right? We hear Plug and Play all the time. And arguably, we could say that our containers are Plug and Play because there's an actual plug that plugs into the back so you can move the container around instead of having it hard connected. Same thing for the water intake. It's an actual water plug, like a hose did connection. So we could technically claim plug and Play if we wanted to, but we don't because every farm has a dial in period.

Gabriel Zarafonitis: 0:34:17

So it's important to set expectations on that side of, I'd say, probably 45% of our leads from newer growers. Then we have, like, traditional farmers that are also looking to learn, especially the newer generation. They're like, yeah, my parents have a dairy farm, for example, or have a traditional cover crop, but I'm interested in doing something during the winter months or doing cow feed, for example, with father. So that will be another part. And then you get to the other spectrum, which is like government agencies and big corporations that are looking to buy either a lot of containers or they're looking to put containers here and there to be able to cover so Caribbean Islands. Right. That's a big one. Government agencies to be able to provide food security, their customers. And it's a bit of a challenge for sure on our side, because the needs are so great between big corporation and a government agency. The questions are a whole lot different in between all of those spectrums, but I think you cover the spectrums of potential customers, potential users as well, quite well there.

Harry Duran: 0:35:29

So, having that experience with new farmers, I'm always interested because I'm always excited to see people entering this space. What are some misconceptions that first time farmers have about getting into this business?

Gabriel Zarafonitis: 0:35:41

Well, if you just scroll on LinkedIn and if you follow a lot of people in the vertical farming space, you'll hear all the time, like, new startups save 99% on your water consumption compared to traditional farming. So that's what they expect. Right. And it's like those numbers are really paperwork because how are you going to measure that, really? I'd like to see your study on how you measure 99% less water than that. So a lot of it is also setting expectations on it's not plug and play. It's not like you go to Apple Store and open up your MacBook and it's ready to go. There is work to be done in it as well. There's cleaning, not glamorous. Right. You will have pest problems as well too. Yes. There is a lobby at the front that protects against outside environment as much as you can, but you still have to follow your SOPs it's not going to be easy there. It's not a white lab coat that you see all the pictures on with the purple lights or the flowful lights. There is quite a bit of hard work involved into it and once they kind of accept that fact, then you'll see a clear divide.

Gabriel Zarafonitis: 0:36:42

It's either all in or all out and say, you know what, actually that's not for me anymore. I'd rather just go back to my stand up desk.

Harry Duran: 0:36:53

Yeah. And then also this idea of having offtake agreements in place or just understanding the marketing aspect of it, I think, as well, because I think they can run a successful farm, they can grow crops successfully and understand that process really, really well. But this is the business side of it, the marketing side of it. Right. You understand what you're getting into and who's actually going to be purchasing these crops that you're growing huge.

Gabriel Zarafonitis: 0:37:20

Yeah. I do kind of believe a little bit if you build it, they will come. Right. Because there's such a need. We would have to talk about this again in five to ten years to see if that's still true. But for sure, before you even consider any sort of equipment, which is even like if you wanted to start with microgreens in a grow tent in your spare bedroom, go out first in your community, go talk to the farmers market, go talk to the local grocery store and ask them what do you need? What's your pain point? Before you do anything else. And once you have that data, that feedback, then you know where to go. Because you may think that microgreens, for example, is like a big thing because there's a lot of marketing around it, there's a lot of influencers are pushing microgreens. And microgreens is great, right? But it's becoming saturated more and more. So you may have a really low hanging fruit like potatoes or carrots, for example, that are there and that you just need soil. And you may not need to have a fancy equipment and it just gets your feet wet a little bit as well too, with the whole supply chain side, too. Because it's not just I harvest and I deliver.

Gabriel Zarafonitis: 0:38:25

There's certain standards you have to follow as well for cleanliness, especially in North America. Also, they don't necessarily want the produce anytime that you're ready to harvest, they'll want it for the weekend, the restaurants, for example. So all that, you got to really get into it first and kind of understand that and only then you can really plan a big operation.

Harry Duran: 0:38:48

Do you find that the folks that work with you, do they start to talk to each other, they start to learn about best practices, what's working, what's not. Do they get to share some of those things that are working for them in their own farms.

Gabriel Zarafonitis: 0:39:03

In between each other? I haven't seen it yet, but you kind of do see a little bit of a community on Reddit, for example, or on Facebook groups sharing the information in between one another? Or do you see a lot of trade shows as well too? Like, hey, I tried this and it works really well. Yeah, for sure. There could be something better. If you need a startup idea to go CA, maybe some sort of LinkedIn for indoor farming, that would be yeah, that is something.

Harry Duran: 0:39:34

I've seen a couple of different WhatsApp groups and I've thought about some ideas. Our page Vertical Farming podcast gets a lot of followers, but there's something to be said and I think probably Reddit is probably a good place to start. There's probably container farm specifically groups that you'll get all the questions there, I'm sure, to start based on your visibility in terms of the different tech solutions you use. You mentioned controllers, irrigation systems. Are you seeing anything that's interesting for you in terms of innovation that's happening within the container space in terms of the different components?

Gabriel Zarafonitis: 0:40:10

Yeah. So if you would have asked me like six months ago, for sure you were seeing a lot of AI. AI, a lot of really complicated system that needs text to be sent out basically for install. Right. And then that kind of slowed down a little bit with a few companies either being bought out or just slashing their staff around Seoul. And then what came back up from that was more simple controllers. It kind of looks like rinky dink, you could say, in terms of the polishing of the product, the end product, but definitely there was a bit of a bit of a reset towards simplicity of use and being able to deploy quickly. Like, for example, like Pulse, right. It's just a sensor array, but it's literally you plug in, you log in, and you're good to go. We use a lot of Troll Master, which was born out of the cannabis industry. Thank you. For the cannabis industry, by the way, for vertical farming, just because they pushed so much R and D and money into it, that now we're capable of doing it for leafy greens at a more reasonable price. On the Led lights, for example, we use Troll Master because there's no control wires, really. It's RJ Twelve plug, like basically a telephone plug between each of our controllers. So if ever you had a failure on your device, you can literally just unplug it and plug it back in and you're ready to go.

Gabriel Zarafonitis: 0:41:37

And for remote communities, we can even send an extra array of sensors just in case. Sensors is something that gets uncalibrated often or even breaks. Someone steps on it, or whatever the case may be, squishes it in between two racks, for example, so we could throw an extra sensor them and instantly get back online. Right. So big fan of that company as well. Too so really seeing a big push on staying away from the AI part for now, but it will probably come back. I think AI has a space, a part in it, especially for teaching farmers the actual plant methodology of it. Like not the plant. What word should I be using here? Sclerosis and all that, being able to read the plant light.

Harry Duran: 0:42:23

Right.

Gabriel Zarafonitis: 0:42:25

Someone that's quite light on. And video AI will definitely help that as well, too, once we get to that point.

Harry Duran: 0:42:32

And do you see the difference when farmers implement the sensors in terms of their ability to have more insight on what's happening inside their farm?

Gabriel Zarafonitis: 0:42:44

Yes, especially when they also have a baseline curve to go off of as well. Too it gives them that confidence. So a good example of that is when we finish our product, like a container farm, we never just ship it out. It goes outside into a Qhuc bay, we plug it in and we actually run the container for three or four days, and we put it through its spaces, bring the temperature up to 30 Celsius, 110 Fahrenheit, bring it back down to just above freezing, add humidity, test the lights and all that. And then after that, for the last 48 hours, we run the container how it's supposed to be run. So if you're doing this green, we'll run it with the proper CO2, the proper temperature and all that, and that gives them that baseline. So when they get the container, after that, when it gets delivered, they see that graph onto their portal and allows them to say, as they're starting the operation, they can match that line to what's existing and give them confidence and eventually they run. They take their own wings and fly. But for sure, if someone were to develop some sort of learning assistance like that, to kind of give just a little bit of a curve, those newer beginning beginner operate farm operators would have more confidence because there's a bit of a panic that sets in, I guess a little bit too when it becomes real. And then when you panic, it's just ten times worse. Right? Yeah. If you want to do something that if someone wants to do something that's an AI based camera that helps farmers with like, baseline, you got something there for sure, that's simple to use and affordable as well, too. That's your KPI if you want to do a startup like that.

Harry Duran: 0:44:25

What's interesting is, as I hear you talk about your approach, I can really see your tech background, your project management background, because we talk about things like SOPs we talk about KPIs, we talk about QC equipment. These are all things that, from learning and going through those experiences in tech projects, how important it is to have all those dot your I's, cross your T's and make sure you're putting out something. Because if you put in that work ahead of time and you do that prep and you go through that flight checklist right, and you're saying, what are the things we need to know before we put this in the hands of our customers? You're going to save yourself so much trouble. And there's some learnings for you because you're pushing your forms to the limit and seeing where it's breaking. And that's a feedback loop for you. Right. And it's very helpful. So it's very interesting to see how your background in tech has inspired you for some of those decisions.

Gabriel Zarafonitis: 0:45:23

For sure. I mean, we don't need to be inventing any wheels here. All of those processes, they've always existed, they've always been implemented. Right. So it's just a question of figuring out what process works best for what you're doing. Like your flight checklisting. Pilots do that for a reason and it happens sometimes that you're about to fly and the pilots are on and say, you know what, something's off with the motor on the left, we can't go off. Thank you for the checklist, though. Farm operators have checklists, manufacturers have checklists. And I would actually encourage, if you're looking for equipment for your vertical farm, whether there's lights or controllers, ask the manufacturer, do you have a QAQC checklist? And if so, can I see it? Because certain things for sure. You may want to keep that kind of process a little bit more discreet. But if they want to provide them, if they do have a checklist and they want to provide it to you, that's a big point to be given to that manufacturer. Because you know that they're going through that process every time in equipment, and they're just not sending equipment out willy nilly without testing it.

Harry Duran: 0:46:30

And for the listener, it's clear that Farm Anywhere follows those policies. It's a good thing to know. So where are you seeing the most opportunity for farm anywhere? This industry is growing so fast, right? So even just looking at twelve months is a lot. But given what you've seen so far, implementations you've done, the conferences you've been attending, where are you seeing the most opportunities specifically for farm anywhere? In terms of growth? For sure.

Gabriel Zarafonitis: 0:47:02

In terms of growth, Caribbean very big as well, too. South America very big. And Middle East as well, too. Those are two hot markets for growth. And then in terms of technology or equipment, for us, it would be to have packages that are easier to get into. A good example of that would be Led is saturated, so there's no need to be into LEDs. Same thing with HVAC Systems. Companies have been around for 100 years. But putting packages together where someone can take a racking system from someone, like a plant system, lids and tray from someone, and then come to us for the irrigation skid, that's a good example. Or come to us for a side, like a 20 foot container, just for a nursery to be able to expand. And then that brings you to my next point, where existing farm operations are noticing the ability that containers have, or the ability to convert an existing shed, for example, into a vertical farm, right? So like a greenhouse, for example, contact us to be able to put a container beside the greenhouse due to nursery part and just kind of rescue that space. Especially that square footage is becoming so much more expensive in big urban sprawls. Being able to reuse that square footage for multiple use is big, right?

Harry Duran: 0:48:31

What's a tough question you've had to ask yourself recently.

Gabriel Zarafonitis: 0:48:38

Are we moving fast enough to be able to provide that need? That was a big part. I actually went to Bermuda for a project two weeks ago, but the week before that, I took a few days off. First vacation in like a year and was asking kind of those tough questions there as you have that set back, and was like, okay, are we moving fast enough to be able to meet the market demand? And what is the biggest weakness that we have to improve on in terms of either for us, what's our biggest weakness in terms of manufacturing? To make sure that we're still putting out a good product and meeting demand that make sure we're not cutting any corners, put proven technology sometimes where manufacturers are forced a little bit to push out newer tech or newer physical hardware that hasn't been yet proven out yet, just because either supply chain or whatever it is. Right. So those are pretty much the tough questions at the moment. Now, I think if you were to ask me again in three months, it'd be quite different. For example, we don't spend that much into marketing, we let the product speak for itself, but maybe we should put ourself out a little bit more. All questions like that, that I guess, any CEO, I guess, and agricultural equipment manufacturers should ask themselves as well too, just to stay on top of things.

Harry Duran: 0:50:11

Yeah, that's a good point. One thing I thought of is thinking about all these conferences that are all these remote locations. Has anyone thought of launching an indoor farming conference somewhere in the Caribbean? Because I'm sure they'd get a lot.

Gabriel Zarafonitis: 0:50:25

Of people to attend 100%. Yeah, that's such a big need there as well. Too middle east gets a lot of attention in terms of conferences in Europe as well too. But Caribbean is definitely a place that really needs some sort of conference, for sure, South America.

Harry Duran: 0:50:44

And in terms of pulling these founders, these conferences away from their families, I think you can make a good case that could make it a family trip once it's somewhere in the Caribbean. It makes it easier.

Gabriel Zarafonitis: 0:50:56

Conversation definitely a good spot to go, for sure.

Harry Duran: 0:51:01

Gabriel, I'm curious because of what you experienced through COVID challenges with supply chain disruptions. That was a very big wake up call for folks in the industry and especially for someone like you who's very dependent on your manufacturing capabilities and redundancies. So what did that do for you and how did you think differently, maybe pre COVID and like post COVID, how do you think about those challenges going forward?

Gabriel Zarafonitis: 0:51:32

Well, when we raised a seed round of investment performing we're at 2.0, it was really in the middle of COVID right? So we didn't really have to deal with the impact before COVID through COVID. We were towards the three quarter way through COVID, so we had the opportunity to at least be able to know what was going on, learn from other people and make proper steps so that if there were to be another COVID, hopefully not, right, but if there were to be, we wouldn't be as impacted. So one of those was to source everything locally. We have very little that comes from overseas, a lot of our wholesalers and suppliers, because we qualify as OEM very often as well too so we get from either Vancouver or the US very close, like our trays, for example, our plastic trays and things like that. So it allows us to weather supply chain issues in that sense and hopefully that pays off in the long run as well. Too and it definitely does pay off in terms of quality of the actual product too, by either doing everything ourselves. So that's another reason we have our own electrician, our own plumber, our own spray foam booth, our own paint booth as well too, with our own painting. There's really nothing that gets done outside our own HVAC deck as well too. So that allows us to also weather the problems and also allow us to control the quality of the work throughout the process and have a lot of communication between the electrician and the plumber and the painter and make. Sure that the processes are smooth in between them and that everything kind of gets married together into one final product, one final system integration. So that plays a big role as well too for the supply chain thing issues there.

Harry Duran: 0:53:30

Yeah. It's great to see how much you've built in and the fact that it was a wake up call puts you in a position to make sure that you're prepared for that going forward, which is great. So as we wrap up, I've been leaving some space at the end of these conversations because of the nature of this audience. It's a lot of your colleagues in the space, a lot of folks in vertical farming, your fellow CEOs and founders. Is there a message that you have for the industry that you'd like to talk to people about or just I'd like to kind of give you the stage for that.

Gabriel Zarafonitis: 0:54:03

Yeah. If anything, we are at the beginning, again, flip phone stage of this era. There is no need to act like competition, like big corporate entities, right? I think that we should collaborate together, work on our strength. Everyone has strength and I think we should stop trying to do everything and do one thing really, really good and then collaborate together. And at the end of the day, the end user is the priority and that's what we want. We want the end user, the farmer operator, to benefit from that tech and not be hindered by it like we see many, many times. So the focus should definitely be moving towards open, sourcing our tech as much as possible and have always have the farmer at the center of the problem solving that we're doing constantly.

Harry Duran: 0:54:54

I really appreciate that you said that. I think there's going to be more of movement, I feel, towards more of the open source. And just people who vibe with that ethos I think are going to start collaborating and probably you'll start to see some sites where people can share best practices. And I think that's going to be something that's going to be for the benefit of the entire industry. So I love the fact that you've talked about it and we've brought it up on this show based on your experience in the industry. It's almost like you're a veteran now in the space, if you can say something like that because of the experiences you had but also the ups and downs that you've had. And then also it's been interesting to hear how your background in tech has really put you in this position to learn best practices and so I think what you're doing is amazing. I'm really glad we got connected and I really appreciate you taking some time to share your story and your background.

Gabriel Zarafonitis: 0:55:44

Thank you. Yeah, same here too as well. Thanks for bringing be able to start that conversation too with everyone. You're at your 167 podcast now or something like that?

Harry Duran: 0:55:54

No, we're closing in on 100 and then I have a couple of other interviews in the can, but definitely within the next couple of months we'll cross the 100 mark. It's crazy because I was thinking about I thought I'd been doing it for two years, but actually this March is three years of the show so it's amazing how I thought I was going to have a couple of dozen interviews and then the show is going to be over. I was like, oh, I spoke to everybody, but every conference I go to I come back with like a stack of cards. So it's exciting. And then I have people coming back to give updates on the industry and so it's exciting to have just found it at the time when the excitement has picked up again and to get to tell these stories, it's something to see the company from the outside. But I love this ability to sort of tell your personal story because everyone has been entering the industry through different paths and there's no one path because it's such a new industry, which I love to hear about.

Gabriel Zarafonitis: 0:56:48

Yeah, I really do appreciate the way you ask and formulate your questions when you're interviewing all the different CEOs because a lot of times I'm listening and I'm like, oh yeah, I want to know that question. Good question you just asked there. It allows to be able to have information sharing and learn quite a bit from others and sometimes same situations, sometimes different situations and I think that will just help us move the industry way further ahead there with what you're doing. A lot of people think like, podcast is just like an entertainment thing. Isn't it true? Some of them. There's not a lot of information, but I think what you bring there makes definitely anyways, in my experience it makes a big difference in the industry to be able to share that information that you kind of claw out of there.

Harry Duran: 0:57:42

Yeah, I appreciate that. I come from a podcasting background. I started my first show, it's called Podcast Junkies where I interview other podcasters. So that was my entry into the podcasting world, 310 interviews there. So I definitely cut my teeth long form interviews and got really comfortable with them. But I always tell people in a podcast conversation, there's three people there's, the host, the guest and then the listener and to never. Forget there's someone listening to the podcast, someone listening to this conversation right now and bringing them into the conversation, including them in the conversation. And I'm really glad you said that. Like, I've been in that position myself, where you want them to ask that follow up question or say like, oh, yes, I'm glad you did that, because a lot of times, new podcasters, they'll have a piece of paper and they'll ask their five questions, and then they won't go deep or they won't be curious or they won't pull the threads. And I think that's where the best stories come from and where the best conversations come from. So I appreciate and I'm glad the podcast is adding value for you as well.

Gabriel Zarafonitis: 0:58:38

Thanks. Do you ever get feedback from the actual listener directly as to what they would like to see in the future? How do you interact with the listeners of the podcast to be able to get that feedback?

Harry Duran: 0:58:50

A couple of different ways. So regular listeners will know that you can go to Ratebasepodcast.com VFP and they can leave a rating and a review. And then I read those out on the air, which I really enjoy doing. I've got people just connecting with me on LinkedIn. They said, hey, Harry, you don't know me. I just found your podcast. I've listened to all the episodes and now I'm closing in on 90 to 100 episodes. So I was like, I don't know if people can listen to the entire catalog, but what's happening is they're entering the industry and they want to know who's who and what's happening. And this is something that's a growing industry and they're getting so much information from the podcast that they're letting me know. And so they'll reach out on LinkedIn occasionally, a DM on the socials. That's why it was important that I have all the social channels, so they usually find a way. Vertical Farming Podcast.com so as a podcast, feedback is like your gold, it's your fuel. It's like, I want to know when people hear the show. I went to Indoor AgCon and I asked a question at one of the panels, and I said, I'm Harry from Vertical Farming Podcast. And so after the panel, like three or four people came up to me like, oh, I love the show, I've been listening.

Harry Duran: 0:59:57

And someone was standing next to me like, oh, you're Harry, because my face is not anywhere on the podcast and maybe I'll change that soon. But what's funny is they're like, oh, I recognized your voice especially. You start to hear someone week in and week out, you get to know what that person sounds like and when they're in person, it's still some funny sometimes. And as a podcaster, I should be used to it, but it's interesting.

Gabriel Zarafonitis: 1:00:20

Yeah. You've ever thought of doing the YouTube form as well, too? Like with just recording exactly in terms of for recognition, I guess, yeah.

Harry Duran: 1:00:29

So I think what I have a lot of it recorded and so it's just now a function of getting through the back catalog and starting to put those on YouTube and then obviously sharing with the guests, getting their okay to put that on. But I do have that that's the plan for the next month or two, getting the entire back catalog on and then going forward having it on YouTube and people start to recognize me more, I guess.

Gabriel Zarafonitis: 1:00:53

Yeah, that's my primary form of doing podcast too as well. I'll go on YouTube, just have a little something going on the computer while.

Harry Duran: 1:01:03

We'Re doing yes, exactly and all that. It is the number two search engine so it's important that we get the content on YouTube as well. So that's part of the plan. So thank you for that reminder and we'll start to get that.

Gabriel Zarafonitis: 1:01:17

Your experience.

Harry Duran: 1:01:18

Yeah, of course. The Farm Anywhere AG for folks to learn more about you and the company anywhere else you want to send people to get connected with you.

Gabriel Zarafonitis: 1:01:27

You could do Farm underscore anywhere on Instagram if you'd like to as well. Again, we're not fancy schwancy on Polished Marketing yet but yeah, just go on your website and pick up the phone like we have a 1800 number on purpose. Wherever you're in the world, give us a call. Of course, emails is fine too, but we're always there to be able to take your calls and start the conversation going as well to anywhere you are in the world and any issue that you want. And also if you have interesting tech that you think would be interesting for us to look at, to be able to implement and to give out to our farmers as part of our package solution, reach out as well to us. We have a little form there on the website if you have something to share with us for that, I'm more than willing to have a look at that as well too. And also a good way is to have a look at Cultivated website. They're partners, there's a bunch of tech there as well if you're looking for equipment and things like that.

Harry Duran: 1:02:28

Well, I appreciate you sharing your time and your story.

Gabriel Zarafonitis: 1:02:30

Thanks Gabriel. Thanks. Yeah, you too. Have a good day.