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Contents
The future of vertical farming that optimistically received a swath of funding between 2019 and 2022 is not the same future that the industry points to now. That version of our industry was built on scale: one enormous facility, one crop, one national brand, and a software stack priced like a technology company rather than a farm.
We spoke with our co-founder and CEO, Conner Tidd, on his thoughts on the top trends for vertical farming in the near and far future since the evolution of the industry in the early 2020's. Conner recognized five major trends now shaping the industry:
Those five point toward an industry that expands steadily, then grows faster once scale is proven. The forecast is worth taking seriously for one reason: it describes what already happened to the farms that closed and the farms that did not.
Read the five trends as two connected arguments rather than five separate calls. Small operators gain ground, and the technology underneath them gets cheaper and more open. Two follow-up posts expand each argument, so this piece stays at the level of the map.
The future of vertical farming looks smaller, cheaper to run, and closer to its customers. Ownership spreads outward instead of consolidating upward. As Conner puts it:
"My prediction for the next five years is we're going to continue to see the democratization of agriculture: the success of small operators in the indoor vertical farming space who can serve their immediate region and communities."
Two words in that sentence carry the weight: "immediate region." Conner is not describing farms that eventually grow into national suppliers. He is describing farms whose whole business case ends at the edge of the market they can drive to, which sets a different bar for what counts as success.
Democratization here does not mean hobby growing. It means commercially serious farms sized to one market rather than a country. Consequently, the question an investor or developer should ask changes. Instead of asking "who scales fastest across the map", ask "who understands their local buyers well enough to sell out the harvest every week."
The first trend in the future of vertical farming concerns who owns the farms. Conner puts the shift plainly:
"We will see a shift away from large operators to small operations filling in the gaps opened by changes in traditional agriculture."
He is not predicting that small farms beat conventional agriculture head on. He expects them to take the space conventional supply leaves behind, and that space widens every time a route gets longer or a category gets less reliable.
In practice, this looks like a grower supplying restaurants, independent grocers, and farmers markets within an hour's drive. There is no national distribution to fund, so the cost base stays lighter. At the same time, the distance between grower and buyer stays short, which means a quality problem (or supply request) can be surfaced and solved within a matter of days.
There is a harder edge to this trend that gets skipped in most industry commentary. A small farm is easier to run profitably, though it is also easier to make irrelevant. Proximity only counts if the local market actually wants premium produce and will pay for it.
The second trend runs against most expectations for an agtech sector: the technology gets simpler. Here is Conner's read on where the tooling goes:
"Indoor farming doesn't have to be complicated. We'll see a reduction in marginal value-added software as growers dial in on what works and to reduce both capex and opex."
"Marginal value-added" suggests he is not arguing against software, only against the layers that add a line to the budget without changing what comes out of the racks.
Indoor farming earned its reputation for complexity during the funding-heavy years, when extra software layers gave an illusion of sophistication. However, every system added is realistically another thing to license, patch, and troubleshoot at five in the morning. Complexity carries a running cost that takes a long time to appear on the balance sheet, usually long after the install crew has left.
Simplification is also what makes Trend 1 possible. A small grower cannot afford a software-heavy build, so every layer that comes out lowers the cost of opening a farm. Cheaper builds are what let small operators into the market in the first place.
The third trend is diversification, which Conner frames as a change in what a farm is organized around:
"We'll see growers move away from being reliant on one traditional crop, instead devoting their operations to whatever the market requires."
"Whatever the market requires" is a demanding standard. It puts the buyer's order sheet ahead of the grower's preference, which is a different way to plan a farm than picking the crop the equipment suits best. Leafy greens stay central, though they stop being the entire business.
Single-crop dependence was a structural weakness in the first wave of large farms, which was inevitable even with immense detail in execution. When one buyer renegotiated or one price moved, the whole operation had to then move with it. A grower selling four different crops can take a price drop on one of them and still make the quarter, because the other three keep earning.
However, diversification is not free, and this is where the trend gets tested. Fruiting crops need longer cycles and closer attention than quick-turn greens, so a power failure or a water fault would cost months of hard work. Operators who add crops faster than they add know-how tend to find that out expensively.
The fourth trend is flexibility, which is the operational payoff of staying small:
"We'll see greater flexibility from growers who are running smaller operations. They'll be able to easily shift their target crops as they respond to specific and rapid demands of their markets."
Conner ties flexibility to size rather than to technology. A smaller farm can change its plan because fewer commitments depend on that plan.
A regional grower could hear from a chef on Monday and change the next planting schedule that week. A national operation cannot, because its planting schedule and supply contracts were signed months in advance and cannot be changed on short notice. For example, a restaurant suddenly wanting fifty trays of a specialty herb is real money for a small grower. For a national operation, the order is too small to be worth changing a planting schedule over.
Flexibility is not improvisation, and treating it that way is how small farms lose money. It comes from planned spare capacity and short crop cycles, both of which have to be designed into the farm before it opens. Meanwhile, flexibility compounds with diversification: a grower already running several lines has the systems and the experience to add another.
The fifth trend changes how farms get assembled. Conner expects operators to build from multiple providers rather than buying one closed system:
"We'll start to see a greater integration of different and varying tools and technologies coupled together to give the ultimate operating advantage. Rather than one proprietor owning all this tech, it'll be gathered from different sources to bring together an optimal operation."
In practice, that means solar paired with an efficient HVAC system, paired with grow racks, paired with automation from a separate provider. Each component gets picked because it is the strongest available for that job, so no vendor's weakest product gets forced into the build.
The commercial consequence is more dire than the engineering one, since best-of-breed assembly lowers switching costs: when a component underperforms, the operator replaces that one component instead of the whole system. Closed systems reverse that, because leaving one weak part means leaving the vendor.
The future of vertical farming, on Conner's reading, is steady expansion followed by a sharp acceleration. He is direct about the sequence and the trigger:
"I think expansion continues over the next few years, then sharpens quickly as climate factors drive the price of food higher and higher. I think we'll continue to see this industry expand, really prove itself, then explode."
The order in that forecast is the argument. Expansion comes first, proof comes second, and fast growth comes last. Consequently, growth has to come from farms that already work rather than from the next round of funding. The last wave was built the other way round, and most of it is gone.
The trigger sits outside the sector. Climate pressure and geopolitical disruption push food prices upward, so locally grown produce competes better against long supply chains. In the meantime, the operators who spent this period fixing their local economics are the ones positioned to meet that demand when it arrives.
The common misreading is that vertical farming eventually replaces everything on the shelf. It will not. The industry performs well on a defined set of crops, while large field crops and big tree fruits stay impractical indoors and may never become feasible.
The industry of 2031 will not be a larger copy of today's model. It rests on smaller and more adaptable operators, simpler technology, and a wider crop mix, accelerating as food price pressure builds. Therefore, the question worth asking is not who builds the biggest farm. It is who builds the most repeatable one, because a repeatable build spreads across regions without paying prototype prices at every site.
There is a simple way to watch this play out. If the farms being built are small, cheap to run, and put together from equipment bought from different suppliers, the shift is underway. If the money goes back into single enormous facilities, it is not.
Smaller, local operators will take share from large national players. These farms run simpler, more flexible, and more diversified operations than the warehouse-scale model that defined the first wave. According to Conner Tidd, CEO and co-founder of Just Vertical, the direction favours growers serving their immediate region rather than a national footprint.
Expect more new, smaller farms rather than consolidation into a handful of national operators. Connner's forecast is that growth comes from regional growers selling to farm-to-table restaurants, independent grocers, and farmers markets. Consequently, the industry gets wider rather than more concentrated over the next five years.
Simpler. Growers are cutting unnecessary software and marginal tools as they learn what works on the farm floor, which reduces both capital and operating costs. That lowers the barrier for smaller operators to enter. In other words, the stack shrinks toward the components that earn their keep.
Yes. Growers are moving off reliance on a single crop toward whatever mix the local market demands. Leafy greens stay central because they are quick-turn and easy to sell, though diversification spreads risk across more buyers. A price drop in one line then stops threatening the whole operation.
Climate pressure and rising food prices are expected to accelerate the industry after a period of steady expansion. Conners's view is that vertical farming expands, proves itself, then grows much faster as those pressures build. To clarify, the growth trigger sits outside the industry rather than inside its technology roadmap.
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