We’ve heard all sorts of analogies about the earliest days of building a startup — it’s similar to building the plane while you’re flying it, or like learning to share your legos, or it often feels like a monster chewing on your leg.
Irving Fain adds a new one to the list. “It’s like a video game where pieces of the game map only illuminate as you walk around the different regions,” he says. “Building a startup is in some ways like staring down this map that is mostly dark — so you don’t know if you’re maneuvering off a cliff.”
As founder and CEO of Bowery Farming, Fain is grateful that he hasn’t steered the company off any cliffs — quite the opposite. Just this week, Bowery Farming announced a $300 million Series C round, making it the largest private fundraising round to date for an indoor farming company. As investors in Bowery Farming’s seed round, the First Round team was in the weeds as Bowery sprouted from just a seedling of an idea to a flourishing business that’s opened three farms so far (plus an innovation hub) and partnered with top grocers like Whole Foods and Albertsons.
While not a first-time founder (Fain co-founded omnichannel loyalty and analytics solutions company CrowdTwist), the long climb to build Bowery started with an incredibly sharp incline. With a mission to democratize access to fresh, locally-grown food, Bowery’s indoor farms have crops stacked floor-to-ceiling under lights that mimic the spectrum of the sun, which can grow all sorts of produce all year, regardless of seasonality. It’s an exceedingly thorny business to build — made even more complex by the fact that Fain had never worked in agriculture before starting Bowery in 2014.
The learning curve was steep, but Fain believes it was a necessary ingredient in Bowery’s recipe to success so far. “Naivety is an important quality for entrepreneurs to possess — there are no assumptions about what is and isn’t possible. The ability to not know what lies around every single corner is actually an advantage because it forces you to look around corners that you normally would never go towards,” he says.
There’s no playbook for what we're doing here. That's both what makes it incredibly exciting and exhilarating — and it's also what makes it very difficult at times.
In this exclusive interview, Fain takes us back to how he went unreasonably deep in the earliest days of the company, and the most critical lessons that stick with him. Some he picked up from his first go-round as a startup founder, others caught him by surprise at Bowery — there’s a wealth of wisdom particularly for folks still toying with the idea of starting a company. From narrowing in on an idea with staying power, to convincing investors to climb aboard and assembling an early team, these are pages from Fain’s zero-to-one story that aspiring founders won’t want to miss. Let’s dive in.
LESSON #1: WHEN WIELDED PROPERLY, NAIVETY IS AN UNDERAPPRECIATED TOOL IN A FOUNDER’S ARSENAL.
In the ranks of startup lore, there are scores of notable founders who built thriving businesses on the foundation of deep industry expertise. For example, Looker’s Lloyd Tabb saw a recurring problem with companies lacking a real-time understanding of data and Rahul Vohra of Superhuman had previously started a company in the email space. Fain isn’t one of those founders.
“I grew up surrounded by the importance of fresh food. I like to say my mother was well ahead of her time by going to farmer’s markets and caring about antioxidants. But I did not come from a long-time farming family or work in agriculture before Bowery,” he says. “There’s always a healthy amount of naivety that should go into evaluating any idea. That said, you’ve got to pair that with real knowledge and understanding of the industry and the business that you’re going into.”
Specifically, Fain looked to understand the challenges in the industry and the biggest holes that the company he wanted to build could fill. He didn’t have a particular idea in his sights, instead, he was drawn to the whitespace around agriculture and technology — and its unique challenges. “Coming from a world before that was bits and bytes and code — it’s pretty predictable. You can sometimes have bugs and problems, but you can fix them. Plants don't always act the way you expect them to act. And I think there's something fun, but innately challenging, about that sort of instability and uncertainty,” he says.
For Fain, building up that baseline knowledge started with an incredibly wide aperture. “I talked to anybody I could talk to. I read anything I could read, watched anything I could watch. There was not a ton of agtech going on at the time, Climate Corp was the company people held up as the example of agriculture technology. So I met with a few folks at Climate Corp to try to get a sense of what they saw happening in the space,” he says.
That broad lens opened up all sorts of company-building avenues — from SaaS on the farm to drones and satellite imagery for farming and precision agriculture, to name a few. “I really allowed myself to explore and understand everything — as time passed and I went further, my focus increasingly narrowed towards urban agriculture. More specifically, how do you get fresh foods to urban environments, and how do you do that more sustainably and efficiently?” says Fain.
When you’re looking to build a company, you start with a really wide aperture, and then as you walk down the path, you have to further narrow that aperture both against the idea and the ultimate business you want to build.
His lack of experience translated to an open mind and unbiased approach rooted in the job-to-be-done, not on the solution-to-be-built. “I had no horse in the race — it didn't matter to me which system we built. I had no preference for hydroponics versus aeroponics or aquaponics or building a greenhouse or having a container farm. What I was really in search of was the answer to what is the most scalable and efficient way to tackle this problem,” he says.
LESSON #2: BALANCE YOUR INPUTS FROM EVANGELISTS AND DOUBTERS.
During this exploration, Fain met folks who got his founder wheels turning in hyperdrive. “One of the stories that I remember fondly is meeting with a Columbia professor named Dickson Despommier who is thought of as is one of the really early evangelists and believers in indoor agriculture and in vertical farming specifically. I had reached out to him and said, ‘Hey, I'd love to come to talk to you and just pick your brain.’ We ended up eating Buffalo wings at an Irish pub in the Upper West Side, talking for an hour and a half about how inevitably vertical farming was going to be enormously successful and the next biggest and greatest thing,” says Fain.
Yet, while plenty of these explorative conversations energized Fain, he was eager to balance the scales — particularly when it came to building a company around innovation that wasn’t mainstream yet. “You have to be really cautious of not falling victim to confirmation bias. While you're talking to people who are both excited and generally believe in what you're doing, it’s equally important to find people who don't believe in what you're doing, think you're taking the wrong path and ultimately think you're making a mistake going about this business,” says Fain.
It started with a subtle shift in framing. “The tack that I took with Bowery was not to believe this idea was possible and prove that belief wrong, but actually the opposite. I went from a base level assumption that this isn't possible and try to prove that wrong,” he says.
That meant for every conversation nerding out with someone like Despommier, Fain reached out to a naysayer. “I paired that with a set of professors up at Cornell who had done a lot of research and felt that it was impossible, and I spent an equal amount of time talking with them to understand why they believed what they believed,” says Fain. “There should be hundreds of reasons why this can’t work — that’s fine. It doesn’t mean you don’t do it. But it’s better to know them ahead of time.”
It’s important to look at all sides of the equation. To think through all the things that could go right, but equally, and maybe more importantly, all the possibilities that can go wrong. If you haven't done that as an entrepreneur, you're not asking enough of the tough questions and you're not looking hard enough at your idea.
LESSON #3: RIGOROUSLY ASSESS FOUNDER/MARKET FIT TO STICK WITH AN IDEA FOR THE LONG HAUL.
While an agricultural novice, Fain wasn’t a stranger to the twists and turns of being a CEO and founder. After helping build up iHeartRadio, he struck out to co-found CrowdTwist in 2009 — which assembled big logos founders would dream of like Pepsi, Sony Music, and the Miami Dolphins. But the company’s success wasn’t enough to keep Fain energized by enterprise software, and he left as CEO in 2014 (CrowdTwist would eventually be acquired by Oracle in 2019).
So in the earliest days of dreaming up Bowery, he was particularly rigorous in assessing ideas with a long-range lens. “SaaS on the farm is a great business. Precision agriculture is another great industry. But they didn’t capture my passion, my imagination and my enthusiasm. That component of the stew is incredibly important when you’re founding any business, because of how long and hard of a journey building a company really is,” says Fain.
He wasn’t the only one who had felt the sting of founder burnout. “I’ve seen friends get incredibly excited about an idea. They go out and they raise some money and then very quickly the excitement sort of evaporates. And now you’re stuck building this company that you’re only moderately interested in. As I was looking at and evaluating different ideas, even when I got more and more excited, I paced myself. It was critical to keep turning over other rocks,” says Fain.
I wanted to make sure that the excitement for Bowery grew and grew over time. That in the great times, and in the difficult times, my passion, enthusiasm and real love of the problem and the business would persist.
While rookie founders may hyper-focus on the starting line — from finding product/market fit, acquiring your earliest customers, and building out your team — in that rush to get off the blocks, it’s easy to forget it’s a marathon, not a sprint.
“The core question you should be getting to is, ‘Am I going to be excited about this in three years, in five years in seven years?’ Because I knew the journey that I was about to embark on was not a short journey. What we're building at Bowery is a generational business. It is the next great food and agriculture company. And that's not something that happens over the course of a few years,” says Fain.
LESSON #4: YOU CAN LOWER YOUR CLIFF-TO-JUMP RATIO, BUT YOU STILL GOTTA JUMP.
While Fain’s a big believer in the power of rigorous research, he was conscious of not spending too much time in the basement. “We did a lot of work early on, even before we raised a dollar of capital, trying to do the best we could to understand whether the critics were right or the optimists were right. We hit the point of diminishing returns — research, testing, building growth systems and analysis and spreadsheets weren't going to yield equivalent value. The next step for us was to build a farm of some substance and size,” says Fain.
One of the things we say at Bowery is getting ahead means just getting started.
It’s a mindset he picked up from when he first waded into the founder waters. “Before I started my first company, I spent enormous amounts of time evaluating, evaluating, evaluating, saying no, and evaluating, evaluating, evaluating, and saying no. And in hindsight, I look back and say, ‘Wow, I said no to some great ideas.’ I spent way too much time getting to the wrong answer, arguably,” says Fain.
It was time to step into the ring. “I could sit on a chair and think my way around this problem for another decade, but when building a company, you never avoid that moment where you have to jump off the cliff. In some respects, what you want to try to make the cliff-to-ground ratio as small as you can. But there is no amount of work and research that avoids the fact that at some point you're jumping off into the abyss,” he says.
For most founders, taking that jump means starting with building an MVP. But compared to other ideas, Bowery Farming required an immensely complicated MVP.
“Bowery is a particularly interesting case study because it's a really complex business with a lot of components. The MVP of a software company is ultimately going to be a lot simpler in some respects than what we built as our equivalent MVP at Bowery,” says Fain. “What I did, and I think what any entrepreneur needs to do early on, is determine what matters most at that very early stage. What are the most important things for you to prove to yourself, to prove to the market and to prove to the investing community (if you're going to be fundraising)?”
The next step is identifying the most efficient paths to reach those early indicators. “What do you need to build? What needs to be created? Who do you need to hire to actually achieve those proof points? Not too much more, but not less,” he says.
Fain built an incredibly simple framework to bite off the business into manageable pieces: Build It, Grow It, Sell It. “It meant, could we in fact build an indoor farm with the technology and the approach that we had created? Could we then grow food in the way that we expected? And once we grew that produce, would it be any good and would anybody actually want to buy it? And those seem like such simple concepts when you lay them out this way. But the work and execution underneath each layer were immense,” he says. “That framework at least gave us guiding posts to focus our efforts to determine what we do and don't do in those early days — to build and grow as efficiently and effectively as possible.”
That meant finding warehouse space for Bowery’s first indoor farm and crafting a lightweight version of what would go on to be called BoweryOS. “It’s the central nervous system and the brains of the growing side of the business, as well as the entire operations and supply chain. It was my core belief that the operating system was key to generating maximum scalability — it’s as important as the growth system itself,” he says. BoweryOS measures millions of data points from a network of sensors across the indoor farm, including humidity and temperature, that have a massive impact on the final taste.
But while Bowery’s MVP may have been robust to account for the complexity of growing crops, Fain is clear that it was still very much a scaled-down version of the grander vision. “The operating system that we built years ago is a fraction of what we have today, of course. The farm today looks drastically different than the farm we built back then. It was all about focusing on what mattered most within each pillar of the business,” he says. The company emerged from stealth in 2017 with six different products — arugula, kale, butterhead, basil and two blends.
LESSON #5: BECOME AN EVANGELIST FOR THE HOW, NOT JUST THE WHY.
On top of an intricate MVP, Fain was facing an uphill battle from a fundraising perspective. “There is no crib sheet that investors can pull out to say, ‘Here are the eight questions I've asked in the past to the other hundred companies that do what you do to help me understand how to think about what your business, your progress and your opportunity,’” he says.
Unless folks work in the industry, agtech has all sorts of nuances that are easily glossed over. “One of the mistakes sometimes people make when they look at indoor farming broadly is grouping the category into one. Sure, everything sort of ultimately falls under the umbrella of controlled environmental agriculture, whether it's a greenhouse or hydroponic growing or aeroponic growing in a vertical farm or container farming. But the truth of it is every one of these growing methods is very different from one another,” says Fain. “The system itself that you choose and the way you build your farm has an extraordinarily large impact on what you ultimately can grow in terms of your varieties, the efficiency by which you can grow those crops and ultimately how economic of a model you actually can build.”
Any founder needs to be a storyteller — convincing all sorts of folks, from investors to employees to customers, to buy into the vision and why it’s important. But Fain adds an additional layer. “One of the important jobs that I had was being not only an effective evangelist for what we're building and why it's important. But equally as important was being a very effective teacher to explain that how we are doing it at Bowery is the most efficient and effective way to tackle this problem,” he says.
But with limited time in front of investment partners, capturing their imagination quickly is critical. “I needed to tell someone the high-level story of why what we’re doing is exciting and interesting. I also needed to explain why we’re tackling this problem the way we’ve chosen to tackle it — and why they should believe this can become a very large, successful company,” he says. “You have to be able to double- and triple-click down. And that helps people who don't know a ton about agriculture, let alone urban agriculture, get comfortable and confident in what we're building and how we're building it.”
Eventually marrying the how and why became Bowery’s brand story, and Fain took his message from Sand Hill Road to the end consumer. “It was interesting because I had people saying, ‘Why would you build a brand? That's silly, you don't need to build a brand yet. Nobody knows you guys are. Don't spend that money,” he says.
But Fain was convinced that it was worth the investment even in the earliest days. Here’s why: “Food is changing. People are asking where their food comes from. How was it grown? How was it made, what are the ingredients? What are the chemicals that are grown in my product? Who's growing it? These kinds of questions are being asked with more intensity and vigor than ever before, and they are causing a real structural shift in the food system,” he says.
“And in many cases, structurally the system isn't set up to adapt to that change. You've got a very complex supply chain that involves many, many different players. And therefore, to answer the questions where does my food come from, who grew it? What did they grow with? It's very difficult,” says Fain.
He points to an example. “When you look at some of the recalls that have happened in produce, like romaine lettuce, at points they've recalled all romaine in the entire country because they don't know where the problem came from in the supply chain. It is almost impossible to trace back, certainly impossible to do it quickly, he says.
So even though there were mountains of work to be done — from building the farm to creating the operating system that would manage the growing cycle — connecting consumers to that story was at the top of Fain’s to-do list. “The benefit that we can provide at Bowery is we control the entire process from seed to store and so we can tell you everything about the product that you hold in your hand. The ability to tell that story to consumers was our competitive advantage,” says Fain.
LESSON #6: FOCUS WINS THE DAY, SO STAY INTENTIONALLY SMALL.
Despite the complexity that lay ahead, when it came to assembling the pieces of Bowery’s early founding team, Fain intentionally stuck to a small team of five. “This was such a vast problem, there were so many rabbit holes one could fall down that were interesting, exciting and felt important. But when there was essentially one person responsible for each area of the business, it forced each individual to only focus on the things that mattered most,” he says.
I'm a big believer that focus wins the day when building a business. And certainly focus is critically important in the earliest stages because you have limited resources, limited time and lots to prove. So one of your jobs really early on as a founder is to evaluate what matters most to the business you’re building.
He started by identifying the gaps using a very simple matrix. “Where am I strong? Honestly, where am I not strong? Where do my skills overlap with what matters most? And in the areas that I don't overlap, then it's my job to go find people who can cover those areas. I come from a marketing and business development background, so I know how to tell a compelling story and build partnerships. I'm certainly not an agricultural scientist, nor am I a mechanical engineer, and I'm not a software engineer. So those are three key places where we brought folks in early on who could lend their expertise,” says Fain.
Rigorous focus was critical, but by keeping headcount low, Fain also had an eye towards clearing what he expected to be one of Bowery’s largest hurdles. “From the financial component of our business, we have had a real focus on unit economics from the earliest of days. And that's because when you're building a software business, nobody has a question if you can make money building software — that's a pretty tried-and-true principle. The question is will anybody want to buy the software that you make,” he says.
“In our instance at Bowery, it's actually the opposite. There's no question that there was enormous demand for better quality, better tasting, and more sustainable produce. The question was, could you do it in a way that was economically viable? And that was really where we spent all of the effort and energy early on,” says Fain.
To challenge the status quo, you’ve got to understand why it exists.
You’ll notice a return to the naivety theme — in his first hires, Fain wasn’t on the lookout for folks who had racked up decades of agricultural experience. “Our mechanical engineer Brian had worked in and around agriculture and greenhouses for a while, and he had some really valuable domain knowledge. But you couldn't look at us and say, ‘Oh wow, they have a bunch of experts.’ We didn't have a 20-year greenhouse grower. And that was really purposeful. That was where the naivety component of the equation came in,” he says.
I felt it was very important to have enough working knowledge on the team to be valuable, but not so much knowledge that it would send us down the long-term prescribed path that many before us had followed.
To bring in that deep industry expertise, he turned his attention to assembling Bowery’s stable of advisors. “It’s equally important to augment the understanding and expertise (or lack thereof) from the team with really strong advisors, who oftentimes do come with decades of experience with incumbent food companies or indoor growing or operations or with grocery and retail. And that provides enormous leverage for myself and for the team in a very efficient way,” says Fain.
He sketches out an example: “I’ve always believed that what we’re building at Bowery is more than just a CPG brand — it's something larger and broader as an organization. And so I was reticent to bring somebody on with a deep amount of CPG experience alone. However, I also knew that, like it or not, we were selling a consumer product in a retail store. And so there are elements of what we're doing that mimic what traditional CPG has been doing for decades, and to ignore that would be foolish,” he says.
Early on, he was introduced to Sally Robling as an investor and advisor. “She had been building and running food businesses for much of her entire career. She was a fantastic thought partner who was able to help us understand the way it had always been done and why, but also had the willingness to recognize that we weren't going to just do it a certain way because it had always been done that way,” says Fain. “She was willing to challenge the status quo with us, but also to help us do that with the back pocket understanding of at least why that incumbent way of doing things was the way it was.”
Executive hires don’t need startup experience to bring a startup mindset.
More recently, Fain has been focused on building out Bowery’s executive team. While industry expertise was not the centerpiece of Fain’s new hire wish-list, he was laser-focused on one key trait. “You can't come to work at Bowery if you want to run a traditional playbook that you've run a hundred times before — it just won't work. The people who are most successful are those who come with a tried-and-true set of principles, experiences, and frameworks, which they can apply to the problems that we're solving at Bowery. But they have an equal part willingness and openness to adapting (or in some cases completely throwing out) those very frameworks because they just may not be applicable to our problems,” he says.
It might be surprising, then, to learn that Bowery’s recent executive hires hail not from fast-growing startups, but from established companies like Walmart, Walgreens, and other big-time brands. “Katie Seawell, who is our Chief Commercial Officer, was at Starbucks for over 15 years and built the whole roastery business in New York, Milan and Tokyo. She was a part of a dynamic, fast-growing, fast-changing organization where brand and values matter enormously,” says Fain.
Starbucks is far from a startup — but Fain saw quite a few parallels to the first principles mindset he cultivated from the earliest days of Bowery. “They had built their own playbook. They were at least reinventing themselves enough for Katie to have some experience and exposure to that idea of taking an understanding of the path ahead and then modifying and adjusting continuously,” says Fain.
“Look for examples that people can share where they’ve had to invent, create and respond to the unknown or the unquantifiable and have been successful. And in other cases, maybe not have been successful, but there’s a willingness to try. You don’t want a 100% success rate — that means we're not trying enough and not taking enough risk,” he says.
And he prescribes closing the interview process with something of an anti-sell. “I made no hesitation to be very clear with people about what this was and what it wasn't. By being incredibly explicit about the journey we were going on, we self-selected, in some ways,” says Fain. “Some didn't have a genuine attraction and interest in walking into the unknown. But some people said, ‘Fantastic — I’m in. When can we leave on this journey?’ And that’s who we hired.”
This article is a lightly-edited summary of Irving Fain’s appearance on our new podcast, “In Depth.” If you haven’t listened to our show yet, be sure to check it out here.