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That's pretty glib, because when they built large greenhouses, people probably said "the market already solved this for high value goods like tomatoes: buy them

That's pretty glib, because when they built large greenhouses, people probably said "the market already solved this for high value goods like tomatoes: buy them from Italy and use a fast clipper to get them here in time". Vertical farms probably indeed don't work out in the current day where we have sunlight, enough land to use it, and transport. Probably most careful analysis would have shown that, but, for things where the analysis has wide-enough error bars, when money is cheap enough, "the market" shows things don't work by incinerating gobs of investor cash and falling over. In the cheap-money era we just had, it was apparently a worthwhile gamble for some. And if you're worth billions and get suckered by a chancer with a flashy pitch deck to invest in something that could have trivially been shown to be economically doomed by some random internet-commenter grousing, then honestly you deserved to lose the money.

bluGill 4y ago
The people building green houses did a real market analysis and saw that the glib analysis was wrong for their city - that is they could find a niche where they could sell for a profit. Many of them also started small to verify the niche really existed - selling a few from their backyard greenhouse, and when demand was proven to exist expanded.
- Oxidation 4y ago
  Perhaps, but if you told me a vertical farm only worked at a scale above X thousands of square metres due to economies of scale, I'd find that quite plausible. So I can see why an investor might not wonder too hard why the scale is so large. On the other side, the dream-sellers have only until the writing on the wall becomes legible to extract the cash, so they can't mess around doing the HP garage thing for a decade. Given the actual consistent result, it's still probably on the investors for being credulous marks with a case of techno-FOMO and high on their own supply, but I don't think it's always been necessarily so simple on the face of it to be debunked by a bunch of grouchy Internet contrarians in 31 seconds (though probably, again based on the result, was always debunkable by decent independent due-diligence). After all, it's not hard to imagine a world where SpaceX is a smoking crater in 2015 and we're all going "well obviously you couldn't have landed a rocket, what did they think would happen?!". Another example: the jury's still out on if Uber's long bet on a pivot into self driving taxis can pay off before they bleed out, and you can find plenty of "obviously..." analyses saying they'd be dead or that they'd be the only transport in town by 2020. Neither of those could start in a niche, they were all-or-nothing. And those greenhouses that did start in a niche would have had huge attrition too, again, at the time, each probably seemed like a good plan to invest the family savings into. It's not unthinkable, to me at least from the outside, that vertical farming had a chance of being a capital-intensive, high-barrier, high-payoff industry. In that I'd be surprised by it about as much as I was by SpaceX's technical payoff about 7 years ago: "huh, so that does work, crazy". And all that said, if you're an investor who would rather gamble the money than spend a fraction of the promised returns on due diligence, then thanks for the trickle-down, I suppose. And probably just as well farming isn't about to end up in the hands of Farming Uber even faster than it already is becoming.
  - bluGill 4y ago
    Sure, if you don't know anything about the topic. It sounds plausible that a big rock "falls faster" than a small rock as well. Which is why investors should do due diligence. What opportunity cost did the world lose out on because investors put money into schemes that a couple days of study could show can never work out? If nothing else that analysis should have revealed that it doesn't work without more efficient, low cost, solar panels and LEDs, and then pivot to those to see if there is any opportunity in either of those areas.

bluGill 4y ago

The people building green houses did a real market analysis and saw that the glib analysis was wrong for their city - that is they could find a niche where they could sell for a profit. Many of them also started small to verify the niche really existed - selling a few from their backyard greenhouse, and when demand was proven to exist expanded.

Oxidation 4y ago
Perhaps, but if you told me a vertical farm only worked at a scale above X thousands of square metres due to economies of scale, I'd find that quite plausible. So I can see why an investor might not wonder too hard why the scale is so large. On the other side, the dream-sellers have only until the writing on the wall becomes legible to extract the cash, so they can't mess around doing the HP garage thing for a decade. Given the actual consistent result, it's still probably on the investors for being credulous marks with a case of techno-FOMO and high on their own supply, but I don't think it's always been necessarily so simple on the face of it to be debunked by a bunch of grouchy Internet contrarians in 31 seconds (though probably, again based on the result, was always debunkable by decent independent due-diligence). After all, it's not hard to imagine a world where SpaceX is a smoking crater in 2015 and we're all going "well obviously you couldn't have landed a rocket, what did they think would happen?!". Another example: the jury's still out on if Uber's long bet on a pivot into self driving taxis can pay off before they bleed out, and you can find plenty of "obviously..." analyses saying they'd be dead or that they'd be the only transport in town by 2020. Neither of those could start in a niche, they were all-or-nothing. And those greenhouses that did start in a niche would have had huge attrition too, again, at the time, each probably seemed like a good plan to invest the family savings into. It's not unthinkable, to me at least from the outside, that vertical farming had a chance of being a capital-intensive, high-barrier, high-payoff industry. In that I'd be surprised by it about as much as I was by SpaceX's technical payoff about 7 years ago: "huh, so that does work, crazy". And all that said, if you're an investor who would rather gamble the money than spend a fraction of the promised returns on due diligence, then thanks for the trickle-down, I suppose. And probably just as well farming isn't about to end up in the hands of Farming Uber even faster than it already is becoming.
- bluGill 4y ago
  Sure, if you don't know anything about the topic. It sounds plausible that a big rock "falls faster" than a small rock as well. Which is why investors should do due diligence. What opportunity cost did the world lose out on because investors put money into schemes that a couple days of study could show can never work out? If nothing else that analysis should have revealed that it doesn't work without more efficient, low cost, solar panels and LEDs, and then pivot to those to see if there is any opportunity in either of those areas.