Elon Musk Brother Kimbal’s High-Tech Farm Startup Abruptly Prunes Staff, Plants

Square Roots, a New York-based farming startup co-founded by Kimbal Musk, Elon Musk’s brother, has abruptly shuttered the majority of its indoor farms and laid off some staff, according to former employees who spoke to Insider. 

Kentucky-based Fox affiliate, WDRB reported the shutdowns on Thursday.

Founded in 2016, Square Roots’ mission is to responsibly deliver locally grown food to people in cities around the world. The company uses vertical farming to grow produce, like herbs and vegetables for salad, in technically-complicated and climate-controlled indoor farms.

The startup grew to five locations by 2019 and raised over $90 million by 2022.

The company’s CEO and cofounder, Tobias Peggs, informed employees about the shutdown decision on Tuesday, according to the reports, and went on to close up shop in four locations: Springfield, Ohio, Shepherdsville, Kentucky, and Kenosha, Wisconsin.

Most of the on-site employees at these locations were laid off, according to the reports. Peggs told employees the company was changing its business model to "farming as a service,” they added. 

Instead of packaging its own products, Square Roots will serve Gordon Food Service, a large, family-owned food distributor based in Michigan that serves restaurants, healthcare, and schools, the reports said.

"We have had to pause commercial production in some of our facilities while we reconfigure them to be more suitable for servicing customers under the Farming as a Service model, and we look forward to bringing these facilities back on line in the future,” the company said in a statement shared with WDRB.

Former staffers told Insider they were caught off-guard. "It was just a normal day," one laid off employee told Insider. "We were in the middle of production and everyone received an email and Slack saying essentially 'Drop everything and attend this Zoom call.'”

This is Square Roots’ second round of lays this year following 49 job cuts in January. At the time, the company blamed the changing economic climate for that decision as it shifted investor interest towards business models that show a clear pathway to long term profitability.