Community-supported agriculture is great. But, at times, you can be bombarded with chard, or wonder what the heck to do with garlic scapes.
What if you could have a weekly box of locally grown produce, only you get to choose exactly what is in it. That’s the idea behind Farmigo, a startup with a service that allows a consumer to “ditch the supermarket,” as its website says, and instead purchase fresh foods from area farms online and pick them up at a neighborhood location.
Farmigo’s founder Benzi Ronen, who has spent 20 years in the technology world, decided it was time to use technology to remove a lot of the middlemen in grocery shopping, so that there could be a fair payback to farmers and the food could still be affordable to consumers.
There is a consumer side, and there is a supply side. On the consumer side, we are just not getting access to the best, healthiest produce possible that is fresh, directly from harvest and grown sustainably. On the supply side, we are not giving the majority of the funds to the actual growers of our food. Just as an example, distributors and retailers give the farmer 20 to 30 percent of what the consumers spend, and that doesn’t enable the farmers who are doing the best job and growing sustainably to become highly profitable enterprises and expand their work.
What is Farmigo, exactly?
Farmigo is an online farmer’s market. Our mission is to create a better food system, that’s better for the eaters and better for the farmers. The way we do this is we connect the farms directly with the consumers. That enables us to pass on 60 percent of what the consumer pays directly to the grower or the maker of the food, and it allows the consumers to get their food direct from harvest, so that it is fresher than anything they can get at the supermarket. They have full accountability of where their food is coming from.
So unlike a traditional CSA, consumers have control over what they get?
That’s right. They have no commitment each week, and, very much like a farmer’s market, they can pick and choose exactly how much they want and what they want.
Founder Benzi Ronen packs individual orders in one of Farmigo's warehouses. (Farmigo)
How did you come up with the idea?
When we started in 2009, we were a software company, building software for farms and CSAs to be able to sell direct. We still do that to date and have about 400 farms that are using that software. But we saw two things happening. The farms were coming to us and saying, “I need help with the logistics. I’m really good at growing, but I’m not as good at coordinating the logistics or marketing and sales to find the customer. I need more access to customers.” We did a lot of market research, and there was also a huge segment of the population who said, “I aspire to buy my food at the farmers' market each week instead of going to the supermarket, but I simply can’t get there because of the time windows or the location of it.”
We saw that as an opportunity to build a service that would give this kind of food to a much broader segment of the population, and do it in a way that was much friendlier to the farm.
What is the experience like for the consumer?
The consumer picks a pickup location that is in their neighborhood, or they can create a new one. Then, they select online from the different items that are in the market. They can see, for each item, exactly which farm it is coming from and the story behind that farm. They place their order, that order than goes directly to the farms and the food makers, so that they can harvest it in an on-demand, just-in-time system. The farmer then delivers what was pre-ordered to our local warehouses, so that we can pack each individual order, which might contain things coming from 50 different farms and food producers. Farmigo gets these orders delivered to the respective pickup locations in each neighborhood.
This is where you rely on volunteer organizers, right?
Exactly. In order to pass savings to the consumer and give them a price point that is about 10 percent less than, say, Whole Foods, and pass on 60 percent to the farm, and ensure that Farmigo can be a profitable business entity, we have these volunteers that we call “organizers” in each neighborhood. They create a convenient pickup location for people in their area, and then they also do the outreach to find people who share the same values that Farmigo has around this kind of food and where it comes from.
Schools can be pickup locations. When you are coming to pick up your kids, your order is there and you can take it home, so you are not going out of your way. Ten percent of the sales become a fundraiser for the school, towards their nutrition program or their school garden.
Synagogues and churches are great pickup locations. Apartment buildings are pickup locations. People are even doing them out of their homes. I ran one out of my apartment and invited all of my neighbors to place orders and come pick them up there. Everybody got great food, and there was an unintended consequence—I got to know my neighbors. I now have this much more personal relationship with the people who live in my building.
You modeled this volunteer system off of political campaigns.
We looked for a model that was highly decentralized as opposed to our food system, which is highly centralized. Right now, you have these huge warehouses that Whole Foods and Walmart use to transport food 2,500 miles, and that’s why, on average, it sits in box or on a shelf for 10 days before you get to eat it. We wanted a system that was local to the farmer and local to the consumers of the food.
We looked to be inspired by where that kind of a model was being applied, and we saw that it was very similar to how political organizations do their outreach. If you look at the Obama campaign, they were able to get volunteers at the local level who really knew the neighborhoods and the neighbors and had real person-to-person contacts as opposed to trying to do these very big, expensive advertisements.
We don’t believe that as a company we can do this ourselves. We rely on the consumers and volunteers in the community to help us build this new food system by creating these pickup locations, which become the last mile to the customer.
You’ve said that this is all part of the “unbundling of the supermarket.” What do you mean by this?
The trend to date has been bigger is better. The more items you can have under one roof the better. Call it the one-stop shop. It forced supermarkets to try to become great at everything, because that is the convenience that the consumer wanted. What’s happening now as a result of technology and cell phones is that your one-stop shop becomes your telephone, where you can place your orders.
Supermarkets are in this unfair position where they just can’t be the best at everything. They end up not delivering on any of the expectations that you have because you can find a better alternative for each of those categories. You get your non-perishables through Amazon, and that’s probably the cheapest way to get what you need. So the supermarkets are now missing out on the non-perishables, which used to be their highest profit margins in the store. Then the supermarkets are just not optimized to deal with fresh produce, because they are not getting it direct from the farms. Now you have companies like Farmigo—that’s all we specialize in, the fresh stuff.
Our focus is the once a week large shopping that you do to fill up the fridge and the kitchen with your fresh items. There is still a need to do your stopgap purchases during the week when you run out of something. Farmigo is not the best at that. There you might have a local bodega, or you might have a service, like Instacart, that you are willing to pay some extra money for to get those things delivered to you within a couple hours.
How would you describe your success so far?
We are in all five boroughs of New York City, and we’re pushing out in all directions in New York. Then we are in New Jersey. We are in northern California, and we recently launched in the Seattle region.
What we are trying to do is pretty ambitious. We are collapsing the existing food system, taking out all the middlemen and establishing a direct relationship between the eater and the grower. In one sense, that is nothing new. It is the way we used to get our food when we were surrounded by farms. But it is new in the sense that we are trying to do that in a very different landscape, with the urban and suburban areas. We’re trying to give you the variety you want for your fresh goods without having to go to the supermarket, and we’re trying to do it at scale, so that it is something that we can do across the entire country.
We measure our success by the number of organizers, these volunteers, that we have basically building these communities. They are an indicator of the demand. You can also look at them as virtual retailers or virtual food cooperatives. Today we have about 400. We’d like to see that grow to many, many thousands across the United States.
You don’t consider yourself a foodie.
Yeah, I’m not a fan of the term, because it sounds too elitist. I am a father of two, and all the parents I know are very focused on feeding their kids better food. When you become a parent, the responsibility is not just for yourself, but also for the next generation. I think that’s what Farmigo is doing. It is helping families better feed their kids.