AppHarvest CEO envisions ‘couple-decade journey’ after going public

AppHarvest (APPH) CEO Jonathan Webb said the company has its eyes on the long term as it looks to “institutionalize” controlled environment agriculture (CEA).

“We see this as a couple-decade journey, and really, we’re in our first decade,” Webb told Yahoo Finance’s Julie Hyman at the 2022 SXSW Conference (video above). “For us, being transparent with not only the consumer, but having that transparency of a public company as we build a large global food company, we think the long-term benefits are great.”

The Kentucky-based agriculture tech company, which was founded in 2017, began trading on the Nasdaq in late February 2021 after completing a SPAC merger with Novus Capital Corporation. Since then, AppHarvest shares have plunged 70%.

Despite IPOs last year having the worst returns in a decade, Webb said he believed 2021 was an important time for the company to go public and stood by the decision to take the company’s mission “directly to the Street” and to receive the “rigor of Wall Street early,” which he claimed will only make the company “stronger in the long run.”

“We have the capital we need and we’re focused on building and operating, and just head down on execution,” Webb said.

(Courtesy: AppHarvest)

(Courtesy: AppHarvest)

The ‘third wave of sustainable infrastructure’

According to Webb, going public has helped the company focus on the big picture.

“For us, at AppHarvest, this isn’t just about a company. It’s about getting the industry to turn the corner at scale globally,” Webb said. “And we don’t think we could do that if we weren’t in the public markets.”

AppHarvest is known for its approach to CEA, which Webb called the “third wave of sustainable infrastructure.” The method of farming uses technology like artificial intelligence and robotics to grow fruits and vegetables, producing 30 times the yield of traditional farming while using 90% less water, the company claims.

“You look at renewable energy 20 years ago, electric vehicles 10 years ago, if we want to get CEA to be institutional at scale, not only in households with consumers, … you really need that rigor of the public markets and that attention of the public markets to help institutionalize an industry,” he said.

AppHarvest's flagship 2.76-million-square-foot CEA farming facility in Morehead, Kentucky. (AppHarvest)

AppHarvest’s flagship 2.76-million-square-foot CEA farming facility in Morehead, Kentucky. (Courtesy: AppHarvest)

In light of the challenges AppHarvest has faced in its early stages, Webb expressed hope that younger generations like Gen Z and millennials would continue to innovate and “fight through” any obstacles in their way.

“The public market needs to have a robust category of companies that are building stuff that matters,” he stressed. “Tech for good — the consumer wants it. The regulators are pushing that direction.”

As a CEO, Webb admitted that this focus on the long-term outlook has not been easy to prove to Wall Street, especially when compared to those who are “selling a worthless product that’s not good for people and not good for planet and arguably questionable for shareholders.”

“It’s easy to be a CEO that’s looking for the next three months,” Webb stated. “It’s hard to be the one that’s looking two decades down the road while thinking of the here and now.”

Brooke DiPalma is a producer and reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.

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