Forget the traditional tie; this Father’s Day, vertical farming pioneer Oishii is offering New York City-area dads a taste of ultra-premium berry luxury instead.
The Jersey City, N.J.-based indoor vertical strawberry farmer, which recently closed $150 million in Series C financing for its Smart Farm model, has introduced a limited-edition Connoisseur six-pack of hand-selected, extra-large Omakase berries available for $50 in select NYC metro ZIP codes.
Selected from the top 1% of Oishii’s Omakase harvest, Connoisseur’s launch was timed around the holiday to tap into the Japanese culture of gifting fruit, the company says. Oishii considers its hand-selected Connoisseur berries the “very best of its harvest,” and they are left on the vine longer than usual to push them to peak ripeness and flavor intensity. The berries are then packed and delivered directly from the farm the same day to preserve freshness.
Premium innovation in the already hot berry category isn’t the only point of differentiation for the indoor ag leader. While the wider vertical farming sector has cooled, Oishii is bucking the trend with fresh financing; a focused approach to scale, robotics and automation; broader consumer access; and technology to set itself apart within the category.
“We made a very strategic decision from the beginning to focus on premium strawberries,” Hiroki Koga, Oishii co-founder and CEO, tells The Packer. “When reinventing an industry this size, it’s almost impossible to achieve cost parity from Day 1; it takes decades. Thus, our thinking from the start has been, ‘let’s tackle a crop that we can charge a premium, so we can establish a profitable business, as we work on cost reduction in the background.’”
Koga says strawberries are one of the hardest crops to grow in an indoor farm, but they are also a crop where consumers can immediately understand the difference between good, great and exceptional.
“That gave us a different starting point than many companies in the category, which began with leafy greens, simply because they were easier to grow, and scaled quickly before proving out a sustainable business model,” Koga says.
From the start, Oishii has focused on building its foundation first.
“We wanted to prove that we could consistently grow a highly differentiated product, improve our unit economics over time, and create a model that would become more repeatable as we scaled,” he says.
Oishii, which has raised a total of $370 million since its founding in 2016, says the recent Series C financing reflects confidence in its indoor Smart Farm model.
“Our Smart Farm model integrates technology, automation, robotics, natural bee pollination and the care and precision of centuries-old Japanese farming techniques,” Koga says. “We have also vertically integrated much of our core technology and operations in-house, which allows our teams to iterate quickly across the farm system. When you are growing a living crop, there is no single breakthrough that solves everything. It requires continuous improvement across plant health, pollination, harvesting, packaging, logistics and retail performance.”
Koga says this discipline has changed the narrative from proving strawberries can be grown indoors to scaling a differentiated model with stronger unit economics, broader retail access and a clear path to bringing high-quality produce to more people.
Expansion and Automation
Robotics and automation have become central to Oishii’s approach to scaling strawberry production with greater consistency, precision and quality control. The company recently acquired Tortuga AgTech and partnered with Misumi, a global manufacturer of industrial machinery and automation components, to bolster its automation — something the latest funding will also augment.
“The broader purpose of this [financing] round is clear,” says Koga. “It allows us to increase production capacity, advance robotics integration, expand farm infrastructure and continue developing new product formats within our Smart Farm model across the U.S. and Japan.
“Automation is important because it helps make the farm more repeatable,” he continues. “In our strawberry farms, there are many variables working together at once, from plants, bees, farmers, robots and climate to packaging and logistics. The more we can standardize and mechanize the right parts of the system, the more consistently we can grow high-quality berries at scale.”
The Tortuga acquisition allowed Oishii to expand its robotics and engineering capabilities, especially around harvesting, says Koga. Meanwhile, Misumi’s expertise in manufacturing and automation components helped the company standardize and industrialize the farm’s underlying infrastructure.
“Over time, we expect robotics and automation to help reduce cost per unit by improving labor efficiency, increasing consistency, improving harvest predictability and reducing variability across the farm,” Koga says.
Like most specialty crop growers in the U.S., labor is Oishii’s biggest expense, accounting for 30% to 50% of production cost depending on the cultivar, says Koga, who adds that automating this process will help reduce cost dramatically.
“We have already succeeded in going from $50 to less than $7 [by] relying on many different levers, but automation is what is going to help us get to $4 to $5 a pack in the coming years,” he says.
Building a Berry Portfolio
Since launching the Omakase berry at nearly $50 per tray in 2018, Oishii says it has expanded beyond its original ultra-premium positioning into a more “flexible” retail business with broader consumer reach, adding the Koyo berry and Nikko berry and introducing new pack sizes and retail formats designed for more everyday purchasing.
“Each of our berries plays a different role in the portfolio,” says Koga. “The Omakase berry is our original product and remains our most elevated expression of Japanese strawberry culture. It is delicate, aromatic and known for its creamy sweetness. It introduced many people in the U.S. to an entirely different idea of what a strawberry could be.”
Koga says the Koyo berry gave Oishii a way to reach more consumers with “a more familiar strawberry format,” but with the consistency, flavor and quality for which the berry farmer is known.
“The Nikko berry is our clearest proof point for broader access,” he says. “It is our most abundant strawberry varietal, with a crisp texture, lively tartness and balanced sweetness that make it especially versatile for snacking, sharing, baking, smoothies and everyday use. With Nikko, we can offer consumers more berries in a familiar pack size and at a more accessible price point while still delivering on Oishii’s standards of peak ripeness, pesticide-free growing, Non-GMO Project Verified fruit and consistent flavor year-round.”
Koga says the Nikko is also more resilient to transportation, which allows the company to work with a broader variety of retail models across a wider region.
While the Nikko berry helps Oishii compete in the everyday part of the produce set, Koga says the strategy isn’t only about price.
“It is about giving retailers a premium berry that can work across more shopper occasions, from everyday snacking to recipes and family use, while still feeling distinctly Oishii,” he says.
Packaging Innovation on the Clock
Earlier this year, Oishii introduced a stay-fresh top-seal packaging for the Nikko berry, an innovation it says represents a new approach to strawberry packaging focused on freshness, shelf life and retail scalability, while also reducing plastic usage by 80% compared to traditional clamshell packaging.
“The packaging was designed with both sustainability and retail performance in mind,” says Koga. “Strawberries are very delicate, and once a berry is picked, the clock starts immediately. Packaging plays a critical role in protecting the product and preserving the consumer experience.”
Oishii’s Nikko Berry Stay-Fresh Pack moves away from the traditional plastic clamshell, with the goal of creating a format that protects quality, keeps berries fresher longer and helps ensure every bite is delicious, he says.
“We also introduced a first-of-its-kind freshness guarantee in the produce aisle: 10 days from harvest, or it’s on us. That promise is printed directly on the back of the pack through our rebate program, reflecting our confidence in how the berries are grown, packed and delivered,” he adds.
While Koga says the company is continuing to evaluate performance with its retail partners, the early response has been encouraging.
“For retailers, the value is a pack designed to support freshness, shelf life and consistency on the shelf,” he says. “For us, it is another example of how growing, packaging and retail execution have to work together. It is not enough to grow a great berry. We also have to protect that berry through the entire journey from farm to shelf to consumer.”
From Bees to R&D
Another major differentiator for Oishii has been its use of natural bee pollination indoors, a feat many vertical farms have found impossible to scale. The company is now advancing its pollination proficiency and R&D capabilities through the development of its new Open Innovation Center in Tokyo.
“Natural bee pollination has been one of the most important and difficult parts of our model,” says Koga. “Strawberries are flowering crops, so pollination is essential to fruit quality, consistency and yield. When we first started, many people believed it would be impossible to create an indoor environment where bees could thrive and pollinate at commercial scale.
“A lot of our R&D has focused on creating the right ecosystem, not just the right climate,” he continues. “We are building an environment where plants, bees, farmers, robots and technology can work together. That requires precision across light, temperature, humidity, airflow, plant health and farm operations.”
Koga says the company’s work in Japan is important because the country has deep manufacturing and controlled environment agriculture expertise as well as a culture of fruit cultivation.
“We combine that knowledge with advanced technology, robotics and data from our farms in the U.S., which helps us test, learn and improve more quickly,” he says.
Koga says Oishii has proved that natural bee pollination can work indoors at commercial scale, and as it continues to grow, it will make that system more consistent and repeatable across new farms, new varietals and higher volumes.
“That is where our R&D work becomes so important in refining the environment so our plants and bees can continue to work together in ways that support quality, yield and consistency,” he says. “Having said that, most of our core bee pollination tech has been developed in the U.S., led by many Japanese scientists in collaboration with American engineers. The research center in Japan aims to produce many more research outcomes beyond just bee pollination, such as the world’s first vertical farm-bred cultivar development.”
Retail Footprint
Oishii strawberries are now sold in 18 states, and the brand recently entered the Toronto market. But the vertical farmer is taking a strategic approach to expansion to ensure it delivers the freshest and most flavorful berries possible to retailers in the least amount of time.
“We want to bring Oishii to more people, but we will only do that in a way that protects the quality of the product,” says Koga. “Freshness is one of the hardest constraints in berries, so we have to think carefully about where we grow, how we pack, how we distribute and how quickly the product can move through the supply chain.”
Koga says while Oishii’s farms are designed to grow consistently year-round, logistics still need to be precise.
“As we expand, we are focused on building density in markets where we can serve retail partners reliably and maintain the eating experience consumers expect from Oishii,” he says. “We are also continuing to improve packaging and product formats so the berries can travel better and perform better at retail.
“The long-term vision is to build a network of smart farms that can grow high-quality produce closer to the point of consumption,” he adds. “That is how we believe we can improve freshness, reduce supply chain pressure and bring consistently flavorful berries to more consumers.”
