Funding Your Microgreens Business: Exploring Options

Funding Your Microgreens Business: Exploring Options (Episode 7)

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This is Part II, Episode 7 of the “Starting a Microgreens Business: What You Need to Know” Microgreens World series. If you missed Episode 6 or the earlier posts in Part I, “Understanding the Market and Business Model,” you can explore them here: “Microgreens Business.”

Starting a microgreens startup is easy to get going – very easy, in fact. But as Steve Blank reminded us in Episode #3, Crafting a Winning Business Model for Your Microgreens Business, a startup is not a business. You have a 50/50 chance of getting to year five, and that’s if you do all the basics correctly.

“A startup is a temporary organization designed to search for a repeatable and scalable business model.”

The #1 reason most startups and small businesses fail is they “ran out of cash/failed to raise new capital.” The #2 reason is “no market need.” So, if you don’t have enough cash to get off the ground or educate your market about microgreens, it is unlike that you will last 12 months.

But this is why I am writing this guide. To help you seek and obtain funding for your microgreens farm business startup.

Funding a microgreens business involves exploring diverse options such as microgreen grants, USDA microloan rates, and urban agriculture grants. The most important activities include creating a detailed microgreens business plan, understanding the microgreens setup cost, and seeking specific grants like the USDA urban agriculture grants 2023. Often, new farmers overlook the availability of specialized resources like the USDA urban agriculture toolkit, missing opportunities to secure essential microgreens farm business financing.

Starting jPure Farms in 2018 was a dream for Steven and me. In the basement of his house, we embarked on a journey to create a thriving microgreens farm business. Financing was our first hurdle, and we knew that the microgreens farm business financing would be the cornerstone of our success.

We started with a simple microgreens business plan template, but we quickly realized that our ambitions were anything but ordinary. We needed more than just growing microgreens for profit pdf; we needed a robust strategy that would allow us to tap into various funding sources like microgreen grants, USDA microloan rates, and even exploring the USDA urban agriculture toolkit.

Navigating the fundraising maze was daunting. We made plenty of missteps testing different options. The path was filled with challenges, but our determination and the right financial choices turned our microgreens side hustle into a profitable microgreens business. Today, I want to share the lessons we learned, the options we explored, and how you can navigate the complex world of microgreens business startup financing.

Whether you’re looking to understand microgreens setup cost, seeking USDA grants for new farmers, or curious about vertical farming grants, this guide will provide the insights you need.

So, buckle up as we dive into the world of fundraising for your microgreens business, exploring your options and setting you on the path to success.

Build A Commercial Microgreens Startup

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Don’t have the time to read right now? Get yourself a PDF copy and read it offline later.


Assessing Capital Needs for Scaling Your Microgreens Business

Assessing Capital Needs for Scaling Your Microgreens Business

Cash flow challenges are a notorious stumbling block, causing many microgreens businesses to falter in the first year. When Steven and I started jPure Farms in his basement, we knew securing capital was essential for scaling our business.

Raising capital is more than just covering initial setup costs; it’s fueling growth and expansion. In the world of microgreens business, it’s not just about planting seeds but planting the financial seeds that allow your business to flourish.

At jPure Farms, we began by projecting our expenses for the startup phase and the first 6-12 months of operations. This included costs for equipment, seeds, marketing, and overheads, along with the microgreens setup cost. We also had to estimate our revenue potential based on our growing capacity, pricing strategy, and market demand. Explore more in Episode #6, “Optimizing Cash Flow: The Make-or-Break Priority for Microgreens Business.”

Comparing our needs versus available capital and cash flow was a vital step. We assessed our personal savings, potential microgreen grants for farmers, and other resources against our projected expenses. This helped us determine how much additional funding was required. We found that seeking microgreens farm financing was essential to bridge the gap between our capital needs and available resources.

Understanding your capital needs involves aligning your financial strategy with your business goals. Whether considering microgreens as a side hustle or planning a full-scale microgreens business startup, assessing your capital needs is the foundational step toward a successful financing strategy. It sets the stage for exploring various financing options, ensuring your microgreens venture has the financial support it needs to thrive.

In the following sections, we’ll delve into the various options for microgreens business financing, drawing from our experience at jPure Farms. Whether you’re looking for a microgreens business plan template or exploring USDA microloan rates, this guide will provide insights tailored to the unique needs of the microgreens farm industry.

Navigating Debt Financing for Your Microgreens Business

Navigating Debt Financing for Your Microgreens Business

The most common source for small business funding is debt financing. This includes loans that you pay back over time with interest. When Steven and I were looking to scale jPure Farms, we explored various debt financing options to understand what would best suit our needs. Here’s a breakdown of the options we considered, along with their pros and cons:

SBA Loans: A Path to Long-term Growth

The Small Business Administration (SBA) offers several loan programs, such as the 7(a) and 504 loans. These were particularly appealing to us for long-term real estate and equipment financing.
Resources: ·


7(a) Loans: These loans provide general working capital and can be used for various purposes, including microgreens setup costs.
504 Loans: Designed for purchasing fixed assets like real estate and equipment, these were a consideration for our expansion plans.

·    Flexible use of funds (7a)

·    Competitive interest rates

·    Long repayment terms


·  Lengthy application process

·  Strict eligibility criteria

USDA Farm Service Agency Loans: Tailored for Agriculture

Being in the agriculture business, we also looked into USDA Farm Service Agency loans. These loans are designed for agriculture businesses, making them a relevant option for microgreens farm financing.
Resources: ·



·  Targeted agricultural needs

·  Potential access to USDA urban agriculture grants 2023

·  Favorable terms for new farmers


·  Limited to specific agricultural purposes

·  Complex application process

Bank/Credit Union Small Business Loans and Lines of Credit

Traditional bank loans, credit unions, and lines of credit were also on our radar. These options offer flexibility and can be tailored to specific business needs.
Resources: Check with your particular Bank or Credit Union for these available options.

·  Variety of loan products

·  Potential for personalized service (especially with credit unions)

·  Competitive USDA microloan rates


·  Stringent credit requirements

·  Potential for higher interest rates

Invoice Factoring and Merchant Cash Advances: Flexible Working Capital

We explored invoice factoring and merchant cash advances for more flexible working capital. These options provide quick access to funds based on your invoices or credit card sales.
Resources: ·   Farm Fund Capital – – Specializes in merchant cash advances for niche agriculture producers like microgreens growers.

·   Produce Pay – – Specializes in factoring for farmers with quick approvals and no fixed terms. Advances up to 90% of outstanding invoices.

·   Farmer’s Best Factoring – – Provides non-recourse factoring for agriculture producers with no maximum invoice size.


·  Fast access to cash

·  No collateral required


·  Higher costs

·  Potential impact on customer relationships (invoice factoring)

Weighing the Options for jPure Farms

For jPure Farms, the decision-making process involved carefully analyzing our needs, the microgreens business profit potential in Metro Atlanta, and aligning with our business plan and business model.

It would be best to weigh each option’s pros and cons, considering factors like interest rates, collateral required, repayment terms, and eligibility criteria. Debt financing allows you to maintain ownership but must be repaid regardless of profits.

Debt financing offers a range of options, each with unique benefits and challenges. It is crucial to understand these options and how they align with your microgreens business startup goals. Sound knowledge of debt funding can encourage sustainable growth and success in the microgreens sector, whether looking for vertical farming grants or conventional bank loans.

Whether considering microgreens as a side hustle or planning a full-scale microgreens business startup, assessing your capital needs is the foundational step toward a successful financing strategy.

Cash Flow is The Life-Blood of Small Businesses!

Let me help you build a 12-month rolling cash flow projection  (+Cash Flow Statement ) under different scenarios to stress test and forecast your capital needs. I can handle the modeling and analysis.

Exploring Equity Financing for Your Microgreens Business: A Closer Look at Seed Funding, Crowdfunding, and More

Equity financing is another avenue that can be explored when seeking capital for a microgreens business. Unlike debt financing, where you borrow money and pay it back with interest, equity financing involves giving away a portion of ownership in your business in exchange for capital. Here’s how Steven and I navigated the world of equity financing for jPure Farms:

Friends and Family Seed Funding: A Personal Touch

When we started jPure Farms, friends and family seed funding was crucial. This approach allowed us to tap into our personal network to raise initial capital.
Resources: When working with family and friends, ensure legal documents are in place. Without them, a fight can quickly become a brawl.

·  Informal and flexible arrangements

·  Potential for lower interest or favorable terms


·   The possible strain on personal relationships

·   Lack of formal business guidance

Equity Crowdfunding: Harnessing the Power of the Crowd

Equity crowdfunding platforms allowed us to present our microgreens business model to a broader audience. We did not consider this option. But it may have some local though limited potential.
Resources: We could find much that was specific to microgreens farming or urban farming.

·  Access to a vast pool of investors

·  Opportunity to build brand awareness


·   Regulatory compliance requirements

·   Potential dilution of ownership

Angel Investors and Venture Capital: Targeting High-Growth Potential

Resources: ·


·   AgFunder:

For businesses with high-growth potential, angel investors and venture capital can be attractive options. Though jPure Farms didn’t go down this path, we did explore it to understand its alignment with our microgreens business profit goals.

·  Access to significant capital

·  Expertise and mentorship from seasoned investors


·   Loss of control and decision-making power

·   High expectations for growth and returns

Accelerator and Incubator Programs: Nurturing Growth

Accelerator and incubator programs provide funding, mentorship, and resources in exchange for equity. As urban farming becomes more mainstream, these programs can be a valuable stepping stone for microgreens businesses. We didn’t consider this then, but we believe it is a good option in today’s environment.

·  Access to industry experts and mentors

·  Structured support and resources


·   Equity stake required

·   Competitive application process


Disadvantages of Equity Financing: A Word of Caution

While equity financing offers various opportunities, it also comes with challenges. The loss of control and potential repayment obligations (in the form of dividends or exit strategies) can be significant drawbacks.

Finding the Right Fit for jPure Farms

Equity financing presented us with diverse options, each with its unique characteristics. From the personal touch of friends and family funding to the broader reach of crowdfunding, we carefully assessed each option against our microgreens setup costs and growth objectives.

The cost of capital is often higher than debt but without set repayment restraints. Equity can provide growth-stage funding but may mean reduced decision-making control.

We offered 5% ownership to family members who provided $15K in initial seed funding when jPure Farms was just a business plan. Equity enabled us to start before qualifying for traditional financing.

Your decision to pursue equity financing should be made with a clear understanding of your microgreens farm business’s needs and the potential trade-offs involved. Whether considering microgreen grants for farmers or seeking investment from venture capitalists, a thoughtful approach to equity financing can help you align your fundraising efforts with your microgreens business’s long-term success.

We found an excellent resource for you. The folks at Ambrook, whose mission is to make sustainability profitable in natural resource industries, have compiled an excellent list of potential funding resources you can tap into after reading this article.

Check out Ambrook’s List of Agricultural Funding for Microgreens.

Unlocking Opportunities with Grants and Contests: A Guide to Funding Your Microgreens Business
Unlocking Opportunities with Grants and Contests: A Guide to Funding Your Microgreens Business

Unlocking Opportunities with Grants and Contests: A Guide to Funding Your Microgreens Business

Grants and contests can be a unique and exciting way to secure funding for your microgreens business. Unlike traditional financing options like loans or equity investments, grants and contests can provide capital without the need for repayment or giving away ownership. Here’s how Steven and I explored these opportunities for jPure Farms:

Federal, State, and Local Government Small Business Grants: A Path to Public Funding

Governments often offer grants to support small businesses, including those in the agriculture sector. We looked into USDA urban agriculture grants 2023 and other federal programs tailored to our microgreens business startup.
Resources: ·   Specialty Crop Block Grant Program (SCBGP):

·  No need to repay or give up equity

·  Support for specific business goals


·   Highly competitive

·   Extensive application process

Non-Profit and Agriculture Industry Association Grant Programs: Aligning with Industry Goals

We also explored grants from non-profit organizations and agriculture industry associations. These grants, such as microgreen grants for farmers, were designed to support specific initiatives within the microgreens farming community.
Resources: ·   Check your state and county for specific opportunities.

·  Targeted support for industry-specific projects

·  Opportunities for networking and collaboration


·   Limited availability

·   Specific eligibility criteria

Small Business Innovation Research Grants and Technology Grants: Fueling Innovation

For businesses focused on innovation and technology, grants like the Small Business Innovation Research (SBIR) program can be a valuable resource. Though not directly applicable to jPure Farms, these grants can be a fit for microgreens businesses with a technological edge.
Resources: ·

·  Support for research and development

·  Potential for significant funding


·   Complex application process

·   Requirement for innovative technology

Business Plan, Startup Pitch Contests, and Challenges: Competing for Capital

We participated in several startup pitch contests and challenges, presenting our microgreens business plan to panels of judges. These contests weren’t successful for us, but they did offer exposure and networking opportunities. Plus, urban farming became cool!

·  Chance to win capital and other prizes

·  Opportunity to refine and present your business plan


·   Intense competition

·   Time-consuming preparation


Differences Versus Equity and Debt Funding: A Unique Approach

Grants and contests stand apart from equity and debt financing. They offer a chance to secure funding without the typical trade-offs of losing control or taking on debt. However, they also come with unique challenges, such as intense competition and specific eligibility criteria.

Exploring Unconventional Avenues for jPure Farms

Grants and contests opened up unconventional avenues for us to explore in funding jPure Farms. From government grants to startup challenges, these options allowed us to pursue our microgreens business profit goals without the constraints of traditional financing.

Whether you’re eyeing urban farm grants 2023 or entering a business plan contest, these opportunities can creatively fuel your microgreens business’s growth.

Discover the hundreds of innovations possible in this microgreens farming business. You may be able to secure a state agriculture department innovation grant program for your automated microgreens harvesting prototype design. Non-dilutive capital to advance R&D. Check it out.

Leveraging Community Programs for Microgreens Farm Financing: Pros and Cons

Community programs can be a lifeline for small businesses like microgreens farming. These programs often aim to foster economic growth and entrepreneurship within the community. Here’s how Steven and I explored community programs for jPure Farms and the pros and cons we discovered:

Community Development Financial Institutions (CDFIs): Bridging the Gap

CDFIs are specialized financial institutions that serve low-income and underserved communities.
Resources: CDFI Fund:

CDFI Locator:


·  Accessible financing

·  Support for underserved demographics


·   Limited funding availability

·   Potential for stringent eligibility criteria

Non-Profit Microlenders: Targeted Support for Entrepreneurs

Resources: Accion:, a non-profit microlender
Non-profit microlenders focus on providing small loans to entrepreneurs who might struggle to secure traditional financing.

·  Specialized support for small businesses

·  Potential for mentorship and training


·   Smaller loan amounts

·   Potential for higher interest rates

Economic Development Groups: Building a Strong Local Economy

Local economic development groups often provide low-cost loans, training, and resources.

·  Access to low-cost loans

·  Opportunities for training and development


·   Limited geographic reach

·   Competitive application process

Resources: ·   Local Economic Development Agencies:

·   US Economic Development Association:

Religious Institution Microfinance Programs: Faith-Based Financing

Some religious institutions offer microfinance programs to support local entrepreneurs.

·  Community-driven support

·  Potential for networking within the faith community


·   Alignment with specific religious values may be required

·   Limited availability

Resources: Religious Institution Microfinance Networks:


Weighing the Pros and Cons of Community Programs

Community programs offer unique benefits and challenges. By engaging with these programs, we explored various funding options for jPure Farms, each with its advantages and disadvantages. Whether it’s a CDFI loan or support from a religious institution, understanding the pros and cons of community programs can be a valuable part of your microgreens farm financing strategy. Community programs provide more than just capital.

Key Takeaways: Navigating the Landscape of Financing Your Microgreens Business

Key Takeaways: Navigating the Landscape of Financing Your Microgreens Business

Embarking on the journey of financing jPure Farms was an enlightening experience filled with lessons and insights that shaped our path forward. Here’s a recap of the various financing options we explored and the wisdom we gained:

Recap of Financing Options

  • Debt Financing: Traditional loans and credit lines.
  • Equity Financing: Engaging investors and venture capital.
  • Grants and Contests: Opportunities for non-repayable funds.
  • Community Programs:** Local support with unique benefits and challenges.

Lessons Learned and the Path Forward:

  • Due Diligence: Conduct thorough research to identify the best sources based on our needs.
  • Balancing Act: Weighing the cost of capital against speed and eligibility considerations.
  • Growth and Scalability: Recognizing that fundraising is not just about survival but enabling growth and scalability.

jPure Farms’ Final Selection:

In year two, we opted for initial equity financing through family and friends and a USDA microloan. This blend allowed us to leverage the microgreens business startup community’s support while accessing affordable capital.

The path to securing funding for your microgreens business is multifaceted. You can navigate the financial maze by understanding the landscape, conducting due diligence, and balancing various considerations. Remember, the right funding strategy can be the catalyst that transforms your microgreens side hustle into a thriving enterprise.

Up next, we go deep into one of the key reasons why many small businesses never “cross the chasm.”. In Episode 8, Cultivating a Growth Mindset, we explore the key to microgreens business success.

Financing Your Microgreens Business: Additional Considerations

As we wrap up this discussion on financing your microgreens business, I want to share a few key considerations that often slip through the cracks but made a significant difference for jPure Farms.

  • Legal Compliance: Ensuring all agreements, especially with friends and family, are legally binding. It saved us from potential misunderstandings down the road.
  • Cultural Fit with Investors: We didn’t just look at the money; we assessed if our angel investors shared our vision and values.
  • Continuous Monitoring Regularly reviewing our financial situation allowed us to adapt quickly, avoiding the pitfall of running out of cash.
  • Innovative financing is crucial when starting a microgreens farm. Beyond the basics, here are additional microgreens funding tips:
  • Look into agriculture grants from groups like the Farmers Market Coalition supporting local farms – extra capital without diluting ownership.
  • For startup costs, don’t forget small details like website fees, business licenses, and signage – these add up quickly!
  • To access capital, determine your credit score and financial position first, impacting funding eligibility and terms.
  • Hope these extra microgreens-focused financing considerations help as you pull together your funding plan!

Remember, it’s about securing the funds and building a sustainable microgreens business. These additional considerations might seem minor but can majorly impact your success.

It doesn’t replace your accountant. But this book is the next best thing to hiring a part-time CFO. We read the book, and it sits on our desks, “Your First CFO: The Accounting Cure for Small Business Owners” by Pam Prior. You should get a copy.

Related Questions

What are the startup costs for a microgreens business?

Startup costs for a 500 square-foot microgreens farm often range from $10,000-$30,000, including costs for growing setup like shelves and LED lights ($2,000-$5,000), HVAC and electrical ($3,000-$5,000), plumbing and water filtration ($1,000-$2,000), seeds and packaging supplies ($500-$1,000), licensing and legal fees ($1,000-$2,000), and working capital to cover 3-6 months of operating expenses until sales stabilize ($5,000-$10,000+ depending on labor, rent, utilities, etc.).

Can you get a small business loan for a microgreens farm?

Microgreens farms are eligible for SBA and USDA small business loan programs. However, new startups often need a strong business plan, financial projections, decent personal credit scores (>650), and some existing capital to qualify. Once established for 1-2 years, a microgreens business will have an easier time qualifying. Government-guaranteed loans should be pursued before considering higher-cost merchant cash advances.

What is the most profitable way to sell microgreens?

Farmers’ markets, restaurants, grocers, CSA subscriptions, and wholesaling to local distributors can all be profitable microgreens sales models. Diversifying across multiple channels helps mitigate risks if one area underperforms. Restaurants and grocers provide volume but may expect discounts. Retail allows higher per-unit pricing. Balance channel mix based on resources and capacities.

How much does it cost to grow microgreens?

Variable costs to grow microgreens, like seeds, labor, packaging, and utilities, typically range from $2-$5 per 10”x20” tray produced based on efficiencies, varieties, and volumes. Fixed overhead costs like rent and loan payments need to be covered too. Improving yields and reducing waste/labor is vital to profitability. Aim for >$10 per tray gross profit.

Is growing microgreens profitable?

Microgreens can be highly profitable with proper financial planning and execution. 10”x20” trays can sell for $15-$25 per tray wholesale or $20-$30+ at retail. Efficient microgreens farms can produce over 500 trays per week in as little as 500 square feet. If well run, this results in over $100,000 per year in potential revenue. Managing costs, capturing value, and scaling production are crucial to profitability.

Share the Guide

Ready to take your microgreens business to the next level? Don’t miss out on the latest insights and strategies tailored just for you!

Share this guide with fellow microgreens enthusiasts, sign up for our exclusive newsletter, and explore related posts to continue your journey. Together, we can grow your microgreens business profit and make your green dreams come true.

Click the links below to connect, learn, and thrive! 🌱 #MicrogreensSuccess

Build A Commercial Microgreens Startup

In this free 10-lesson email course, we explain why you shouldn’t create a “business plan.”

From there, we take you on a journey of discovery that has been trekked by tens of thousands of other entrepreneurs just like you.

We respect your privacy. Unsubscribe at any time.


  1. “List of Agricultural Funding for Microgreens.” Ambrook, Accessed 9 Aug. 2023.
  2. “STRONG COMMUNITIES – STRONG FARMS: WHAT IS the CONNECTION?” Edited by Thomas A. Carlin. AgEcon Search, 1988, Accessed 9 Aug. 2023.
  3. Althouse, Mark. “Crop Insurance.” Farmdoc, Accessed 9 Aug. 2023.
  4. “How It Works.” BARN2DOOR, Accessed 9 Aug. 2023.
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Optimizing Cash Flow: The Make-or-Break Priority for Microgreens Businesses

Optimizing Cash Flow: The Make-or-Break Priority for Microgreens Business (Episode 6)

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