In a surprising move, Square Roots, the “smart farm” startup co-founded by Kimbal Musk, Elon Musk’s younger brother, and Welsh entrepreneur Tobias Peggs, has announced the closure of most of its locations and laid off a majority of its staff. The vertical farming startup, which pioneered high-tech indoor farming modules, reportedly had nearly 200 employees as of June, according to the PitchBook venture capital database. However, the exact number of staff laid off remains undisclosed.
Dismissal Via Zoom
The layoffs were revealed in an abrupt Zoom call, catching many of the now-former employees off guard. A source from the company’s Grand Rapids, Michigan location described it as “just a normal day” before they were asked to stop their work for an impromptu Zoom meeting. The news came with no prior context, leaving the staff in shock. This unexpected move occurred in the midst of production, adding to the confusion and disappointment of the affected employees.
From Multi-State Operations to Major Shutdown
Prior to this major shutdown, Square Roots maintained locations in Michigan, Wisconsin, Ohio, and Kentucky. This move follows the closure of its Brooklyn, New York flagship location earlier this year. The recent shutdowns are particularly surprising as multiple locations had only just opened within the last year. Notably, these farms were operated in partnership with Gordon Food Service, a prominent player in the food industry.
Transition to “Farming as a Service”
According to a company spokesperson, the sudden closures stem from a strategic shift in its business model to “farming as a service.” In a statement provided to local broadcaster WDRB in Kenosha, Wisconsin, the company noted that it is now operating its climate-controlled farms “exclusively for our strategic partners.” This shift has necessitated a pause in commercial production as the company reconfigures its facilities to better service customers under the new model.
Future of Laid-Off Employees Remains Uncertain
Despite the layoffs being described as a “temporary thing,” there seems to be no clear assurance of rehiring the affected employees. One former staffer described the layoff situation as “devastating,” expressing uncertainty about what the future holds. “It wasn’t like they were saying ‘You guys will be offered your jobs back’ at any point,” the ex-employee stated.
Impact on the Hydroponic Industry and Employee Morale
The abrupt halting of operations at Square Roots, particularly the hydroponic setups, has a significant impact on both the industry and the livelihoods of the employees. One laid-off worker lamented, “A lot of us feel like we have to start from ground zero now.” The future of Square Roots remains uncertain, with no clear-cut explanation for the shutdowns or information about potential reopening plans. As the dust settles, both employees and the industry are left wondering what’s next for this once-promising startup. For more information about Square Roots and its operations, you can visit its official website here.
The recent developments at Square Roots serve as a stark reminder of the inherent risks and unpredictability in the startup sector. The story of this “smart farm” startup’s sudden shift in strategy highlights the uncertainties even well-established startups with significant backing can face. While this transition period is undoubtedly challenging for those directly affected, it also opens up opportunities for dialogue about resilience, adaptability, and the evolution of the hydroponics industry. As the industry continues to evolve and adapt, the hope is that new, sustainable opportunities will emerge for those affected by Square Roots’ restructuring.
Though the future for Square Roots and its former employees might seem uncertain now, the field of hydroponic farming is growing and advancing. With the lessons learned from this experience, a brighter and more stable future could be on the horizon for those committed to this innovative and important form of agriculture.