#122 Smallhold: Growing the World’s Best Mushrooms in High-Tech Mini Farms Right in Restaurants and Grocery Stores | Andrew Carter, Co-Founder & CEO

About Smallhold

“Smallhold wants people to eat more mushrooms. We are mainly just trying to get mushrooms on people's plates in any sort of way possible. We want them to be grown locally, so they're fresh and enjoyable.” – Andrew Carter

Andrew Carter is co-founder and CEO of Smallhold, which is upending the food industry by growing their mushrooms in Michelin-star rated restaurants, grocery stores, and through their network of onsite and macro farms. Smallhold is inverting the way food is traditionally grown and distributed. Today, 68% of all mushrooms consumed in the United States come from a single town in Pennsylvania called Kenneth Square. 400 million pounds worth of mushrooms per year, to be exact.

This means that most mushrooms are transported across a vast distribution network to reach stores all around the United States. Smallhold knew there was a better way, so they spent years creating a proprietary set of technologies that allows them to grow mushrooms in an incredibly small footprint, about the size of a small standing cabinet.

The first Smallhold onsite farms went up in restaurants around New York, which was followed by onsite farms and grocery stores, including Central Market stores across Texas, where these onsite farms sit right next to where the mushrooms are sold in the grocery store. Smallhold is an incredible example of what the future of food looks like. They're inverting the single farm approach, and pioneering a footprint of small onsite farms and regional macro farms.

They've created a whole slew of proprietary technologies to automate the process and help restaurants and grocery stores grow the same amount of mushrooms every single week, and they're just getting started. In this episode, we cover the wild world of mushrooms; from the Netflix documentary, Fantastic Fungi to the book, Entangled Life, to Mushroom People. We go deep on how mushrooms work, why most of us have eaten only a single variety of mushrooms our entire lives, and why we should all be eating more mushrooms.

Andrew covers why the modern food industry is broken, from why most apples you eat are nearly a year old, and why most fish sold in the United States, even if it's caught in the States, is sent to China to be processed, and then back to the US to be sold. We cover the technology behind Smallhold, from the incredible number of sensors embedded into their farms, to how much data they crunch every day, to grow incredible mushrooms reliably 24/7, 365. And all of the lessons Andrew has learned along the way, from how they built a new direct to consumer side of their business during the pandemic, to how they've iterated and refined their business model over the years.

For more, explore the transcript of this episode.

‍

Chapters

This episode is our definitive guide to growing the world’s best mushrooms in high-tech mini-farms. In it we cover:

00:00:00 – Introduction
00:02:51 – The move from hydroponics to mycology
00:13:34 – How Smallhold is getting people to eat more mushrooms
00:19:02 – The science and complexities of growing mushrooms
00:24:02 – The decomposition cycle and mushroom growth technology
00:32:13 – Revamping the food industry
00:37:47 – The concept of distributed farming
00:41:56 – How branding fresh produce is different from other products
00:45:19 – Smallhold’s presence in local restaurants
00:51:52 – Fantastic Fungi from Netflix has increased interest in mycology
00:54:33 – The importance of letting go as a founder

Listen to the episode on Apple Podcasts, Spotify, Overcast, Google Podcasts, Amazon Music, Castbox, Pocket Casts, Player FM, Podcast Addict, iHeartRadio, or on your favorite podcast platform. You can watch the interview on YouTube here.

Our Favorite Quotes

Here are a few ideas we'll be thinking about weeks and months from now:

“A lot of people in developed countries are living on a global diet, and mushrooms just have so much opportunity with health and nutrition and all of that, but also just so much opportunity in that people don't know what you can do with them.”
“Fungi is its own kingdom and they are more like animals than like plants.”
“If you're buying an apple, a lot of the time, it's a year old. There's an amazing innovation in making it feel like it's a fresh apple.”
“We can grow outdoors and actually feed people, but my opinion is more that the climate is changing so fast that a lot of the organisms that we grow can't evolve fast enough for the environment that we're going into, and so we need to figure out these solutions now because in 20, 30, 40 years, it's likely that we're going to be relying more on these things to have at least a somewhat similar diet that we have today.”
“There are so many different paths to get to success, even at the same milestone that you want to get to, and sure you need to track it appropriately and you need to communicate that in the right ways for your team and your shareholders, but trusting your team as long as they're motivated is the most important thing you can do.”
“The world is scary and we need to worry about sustainable food and all this kind of stuff and Smallhold can really help with a lot of that, but at its base level, you should have fun while you're eating and you should really enjoy eating and feeding your family because it's one of the most enjoyable things you can do. Try to try mushrooms out because they can be a lot of fun and they can help the world at the same time.”

5 Ways to Dive Deeper

Want to dive deeper? Here the best content we've curated on this subject:

Fantastic Fungi: This documentary from Netflix gives a beautiful, in-depth look at the wonders of mycology. (1 Hr 30 Min)
The Future of Restaurants and On-Demand Food with Michael Joseph of Scratch Kitchen on Outlier Academy: In this episode, we discuss an entirely new approach to restaurants that offers multiple brands and food types—from salads to sandwiches and burgers—all under one roof, along with Michael’s views on the future of food delivery. (1 Hr 38 Min)
Creating a Healthier Coffee Alternative with Lopa van der Mersch of Rasa on Outlier Academy: In this episode, we discuss a brand of adaptogenic tonics (most featuring chaga mushroom) often used as coffee replacements. (52 Min)
6 ways mushrooms can save the world: This TED Talk with Paul Stamets (who has authored many of Andrew’s favorite books) introduces the many ways mushrooms can benefit us, such as by cleaning polluted soil, making insecticides, and even treating smallpox. (17 Min)‍
The Nutrition Source – Mushrooms: The Harvard T. H. Chan School of Public Health provides a thorough overview on mushroom nutrition, types, and even recipes;. (10 Min)