(Click to play video.)
Back in
late January, we caught up the CEO of an innovative ag-tech company engaged in acquiring, patenting, and
commercializing various agriculture technologies. Vancouver BC-based
Affinor Growers Inc. (
CSE.AFI,
OTCMKTS: RSSFF,
Forum) is focused is on
vertical farming technology for indoor-controlled environment and outdoor greenhouse agriculture industry. It produces strawberries and other crops, such as romaine lettuce, spinach, and herbs.
Stockhouse Media’s Dave Jackson was joined, once again, by company CEO Nick Brusatore to get investors and shareholders up-to-date on the latest investor news happenings and all things Affinor.
SH: To start off, Nick, for our Stockhouse investors who may be new to Affinor, can you tell us a bit about yourself what the company has been up since we last chatted.
NB: To keep myself minimized to get to the important stuff, I've been in the vertical farming space, the agriculture design space, the sciences, the physiology, the biology, the botany, the extractions of metabolic manipulation in higher realm of plant physiology and in the 23 years of design work that I've been involved in, I've evolved to where we are today which is going to really emerge as I believe to be a very strong piece of the truth of vertical farming. The truth and the physics behind the truth of the way it needs to be done.
SH: The Company has just hired a Fraser Valley nursery to supply commercial strawberry seedlings. Can you walk us through this initiative?
NB: Sure. We brought the seed in from Holland, fairly expensive seed, but we wanted to start with strong seed stock rather than a potentially depleted crown, and anybody who knows the strawberry industry will know that you can buy fresh-dug, plugs, you can buy frozen Browns, you can start from seed, you can capture your own runners. There's a number of things that can take place with strawberries. I wanted to get going right now, me being as impatient as some of our shareholders, okay. I'm with the shareholders, the sooner I get this done, the better I'm going to feel and the better we're all going to feel. So I wanted to get the clock ticking immediately, get a high quality hybrid with the genetics so that the first fruit that comes off of these plants of Affinor when we transplant them into the facility, they will be from seed, very strong genetic production through flavonoid and sugar, because it's so new, they're not depleted in generation much like a cannabis plant, clippings and whatnot.
So the fruit that's coming off of our products will be sweet, very, all the flavonoid and tartness and everything. The Brix levels will be off the charts, but I wanted to get started with that right away so that no matter what happens, any delay happens for a week, or something happens, it doesn't matter. It's no big deal. The clock is ticking on our berries hitting the shelves, you know what I'm saying? No matter what.
Delays happen -- I've learned that -- so to cover my own ass, I and Thomas Baumann, our strawberry resident expert here in Canada that is an advisor for Affinor, he said let's get the seed going. It's better genetics, so we can get going now and I just agreed. I couldn't agree more. So great idea and we got her moving and now we're just waiting for the good stuff to show up because it's showtime soon.
SH:In fact, now the company looks set for very strong growth in 2021, especially in the cannabis space. How are you placed to expand operations to meet this demand?
NB: We're all about quality and rather than go big and humongous and create a whole bunch of something that society is not entirely interested in -- you see the thing I know about marijuana industry, they get bored quick, these folks, okay. The next beautiful fancy nugget wins. Okay. You want your turnover? Turn it over. We liked the idea of growing high end hybrid boutique products that are grown to perfection much like the way you see behind me in soil, that's properly designed for the product for natural micronutrient breakdown for proper tissue development. We don't use a whole bunch of enhancements. We are about the quality of the products. There's a lot of disclosure that's coming out about Affinor in patents further, you know, designs. I don't want to tip my hat too much. It's really close here.
So I don't want to say too much but what I can tell you is from a cannabis standpoint, I can't wait to finally show off. Okay. I just want to show off. I don't care how big, how small. We just want to show you how we're going to do it and then of course, what we're looking at doing is supplying and selling turnkey systems complete by the square foot. Complete with the Tesla solar, the batteries, the tech, the water recovery, the soil remediation, and turnkey. I'm designing a new building, it's going to be tremendous, off the charts for what we need. The physics behind the building will be key. That's what I'm all about.
SH: If you've got it flaunt, right?
NB: Well, we’re getting there. When it's on the shelf and the berries are there and I can shut down the people that would not believe. You know, our brand is done, the packaging is chosen. I mean, we've got a lot of stuff, a lot of disclosure coming that is very cool. Also ESG compliant. We are not just another vertical farming company that's going to be successful and profitable, I might add, but we come complete with patents, packaging, design, our own branding for the strawberries and all of our food, the genetics for the branding of cannabis -- I'm going to get back to the cannabis -- but we believe with our automated systems, I don't know if you've noticed but we had a press release about how I've designed a higher enriched nitrogen-carrying drying chambers complete with these special screens that are designed to create high quality. Things are going to change and people just need to understand -- I'm not going to explain all the sciences here because some of that's in our IP -- what I can tell you is I've been doing this too long to not share what we're about to do with the world and become one of the pre-emptive leaders. I'm very confident that Affinor will be a leader soon in vertical farming space overall, globally.
SH: For company shareholders and potential investors, what kind of future development and progress can we expect at your grow house operations?
NB: Well, the progress you'll get will be a complete encompassed program that will give governments, give capital markets, investors, certainty. Some certainty behind what the hell they're doing, okay. Right from the ground, the grow, there's physics behind it all folks. That's what I've always said. I gave speeches in 2010 in New York about the microbial safety issues in the United States in New York, I was talking microbial issues in 2010 and safety and stuff and nobody really knew what I was talking about then. So they sure do now and now Affinor has designed an encompassed program that is just remarkable for cannabis that we just need to build one, which we're going to do. We've decided that this whole facility here is being filled with strawberries and there's very large reasons for that, which I can't disclose right here but let's just tell you, I'm going to say this to the markets right now, there's as much strawberry interest in the world and for food, if not more than there is for the cannabis industry. So don't think because we're strawberries and getting into lettuce and things like that, that we are missing the boat, because we are certainly not.
SH: You’ve also notched a patent for automated vertical farming production towers. This sounds exciting and fascinating.
NB: We sure have. In fact, we're about to notch a whole bunch more patents as well that are going to be, there's a lot more disclosure coming to do with Affinor. Although we're going to be launching our own products and our own operations, don't think for one second, that we are not developing IP up the yin yang, okay. I'm all about protecting every single thing for Affinor and making sure when we put it to use, we're not putting it to use in any countries that it's not protected, okay. We're going to make sure that we utilize this properly, that our Canadian governments are involved to help the technology transfers from other countries such as an Aruba. We are in a lot of negotiations, in discussions for that purpose. The patents that we have, like I said there's more disclosure coming, but the current patents that are being issued now all over the world that we filed for on this tower, the ease of setup -- like watch how fast when these hundred towers show up here at this first facility -- we'll have them set up in literally a day.
They set up quick, they're designed for compact shipping, quick set up, boom, boom, boom, and it's over. We're growing. Okay. This isn't a whole bunch of nuts and bolts bs. This is like to the point, get it up, get it done. These people need food, okay. It's not a two year process to get this stuff up. That's what brings me why with our patent stuff, It brings me to the reasons of why I've designed and developed and designed everything for a complete encompassed turnkey solutions for Affinor completely. The companies we're dealing with right now are very large, that are very capable of implementing and building our stuff all over the world for people. I need the certainty that when I put a project up, I make my five phone calls and presto within three months there's a facility built there and everybody knows what they're doing quick, real quick.
SH: What exactly is vertical farming technology, how does it work, and what are the benefits over traditional indoor systems?
NB: Well, the benefits of vertical farming is, in ours anyway, I wouldn't suggest that these benefits that I'm going to label are particularly applied to everybody because they don't, there's very onerous stuff that's out there that just doesn't make any operational sense -- yeah, it grows the plants in a rack but it just doesn't – look, you got to get it in the ground, into the box and on the shelf, real nasty and cheap, okay. From here to here out the door with not a lot of clean up needed, not a lot of this, not a lot of that, okay. It's got to be done extremely streamlined to be profitable, alright, and your energy use must be very efficient. That's why I am soil, sun, and water. So the reality is the efficiencies for vertical farming for our machines, for our stuff only, I'm only talking about our stuff, is the use of loading and unloading for our towers. They rotate, if you want to turn them, very easy for loading and unloading, ease of picking the rotation, okay. Conveyor systems automation is all put into this thing. Loading and unloading.
If you've got any pest management that you got to do, anything, plant maintenance, plant management, any type of natural organic sprays that are required for any type of possible diseases or anything, but mostly the picking and the plant management but also the levels, the amount of levels that you get per square foot. And mostly for our stuff is largely the airflow. We're not jam packed in there where our plants are trying to breathe through each other.
Micro-Climates in some of the greenhouses for some species are problematic under canopies and things. It's a breeder for bugs and sort of stuff like this. So the way that we've operated with our airflow around our machines and with the use of our machines, just so you know, the four level machines that are going into this facility here that we're putting in now, right, they’re the four level machines. Just so you know, I mean, here's a little surprise for everybody, those machines are designed for eight levels. There's another whole half a machine to slip on top there to be tied into the top seismic. So whatever we do in this greenhouse folks, just at the snap of 200 or whatever more thousand dollars, I can double our numbers, double it for automation. So that's what I'm talking about.
I'm talking but without jeopardizing my physics. And when I say that I'm talking about air volume. Air volume and air flow are two very different things. When you're vertical and you got that many more plants, perspiring water into the air, you have a saturation of water in the air. You need more air to expand the air, to grab the water, to rise it, to get it out of the building. Hence you don't do that, you get condensing, you get different temperatures, the water condenses, and the plants are breathing, if they're hydroponic, particularly they're breathing through fertilizers, unused stuff into the air, it condenses, it dries, it condenses, it's microbe city. Now you've got issues.
SH: What separates Affinor Growers from the competition and makes your business model unique?
NB: Well, we do soil remediation. We have all water conservation, we're alternative energy. We're designing our own complete turnkey systems with greenhouses complete. I don't think there's any other companies out there, there’s crate boxes, like, I don't know those steel boxes and things like this, they're turnkey. Unfortunately for what they cost, the cap costs versus the quality of the cost of the air, running them, I don't see that being profitable, I'm afraid. Food's a necessity. I guess if you're hungry, it doesn't really matter what it costs. You got to eat, you got to grow it. Who cares what it costs, you got to eat? I had a lettuce might cost 20 bucks on one of those things, but if there's nothing else to eat, you've got to pay it. So, I mean it's going to be all the economies to scale. But we're hoping that based on what we do and the way that we're utilizing the energy of the sun and the air and the way our buildings will be designed, there's a lot of stuff that's really going to change that I'm going to have some pretty mega breakthroughs with agriculture. I'm just so glad I'm back to designing agriculture. I'm back to being me again. So bloody nice. I don't know what happened. I'm on fire with design right now, it’s coming out of me like you wouldn't believe. So Affinor, is just going to love some of the stuff that we're coming out with on development, and yeah, we are going to outdo people, like we're going to outdo people. So we're very excited and Affinor is not the same company anymore.
SH: I have to mention your stock has had been on a bit a roller coaster ride this year. What can you tell our investor audience regarding the current valuation of your stock and why you think it’s a good buy right now?
NB: Well, the stock, it's got 200 plus million shares out. The trading industry seems very different than it was 10 years ago. People are very short-sighted. They go into a deal. If it doesn't pop and double, they're out, you know what I mean? It's all based on if there's no promotion going on, nobody is interested. There's no big promo. Nobody really cares about the fundamentals anymore. In the microcap, they're all worried about what the promo is and what type of stuff is coming out really right away. There's a lot of impatience. Affinor, the difference for our stock now is, and I explain this to people, if you're looking for a quick hype out right, that it's going to go from 3 cents to a buck next week because I've hired millions of dollars worth of promo, that ain't gonna happen folks, there is no promo. The promo is the fact that we're getting the job done. You know what the promo is, is the six o'clock news when our berries are on the shelf, the promo is you buying our strawberries and talking about how fantastic they are online. The promo is the quarterly reports and revenue coming out. Okay. That's my promo.
SH: What’s the long-term strategy for the company moving into 2021 and beyond, and what should retail and institutional investors be looking out for?
NB: Well, what I'm going to guess is going to happen here and with a lot of the groups that are starting to reach out now, some of them are starting to poke around and they're paying close attention right now. I think for the growth model is we're looking to build a quite a bit more square footage here in the very near future. The presentation that's coming forth right now that we're building is largely for the institutional investor. It's something that we will be doing -- put it this way, I'm not interested in raising two or three hundred grand anymore. I'm done with that. This peanuts game is over for me. It's the real deal now. All we're doing is turning this on and then we're going to see who's coming in with the big money. We'll see, we'll decide, but they're coming.
I can tell you that and the berries will be on the shelf. There are no shortages of buyers at the price that we want in our model. We've achieved our model price. So there's no shortage of anything for what we're doing. We're in demand. I have a little bit more to prove, not only to our shareholders, but to the capital groups. We’ve focused and have executed everything that a capital markets will need to see from an institutional standpoint. The use of funds and our financial statements are very strict. I mean, honest to God, there is not even been a cup of coffee expensed on this company by anybody, including myself. No entertainment, no dinners, no lunches, no coffees. It's been hardcore asset building, paying only the absolution of what is required for us.
I would suggest that the mutual funds and the funds that are looking at us now that we're talking to, I suggest that they review our financial statements and they'll see the big changes in the use of funds and the management of the funds. We have an audit committee. We're not the same company folks, I'm under the gun. I'm really under the gun. There's a thousand guns to my head right now to get this done for you. So I put one of them to myself, so let's go, okay. Mutual funds are going to be happy with the money management, the tech, the patents, the development, the overall ownership and what we're going to build and our revenue model is good. We're going to be a profitable vertical farming company. One of the few.
SH: Can you tell our audience a little bit about your corporate management and board teams, along with the experience and innovative ideas they bring to the indoor farming technology space?
NB: Sure. I will go through. Our chairman, Rick Easthom is a long-time grocer, very well-versed, he's retired recently from Choices. He was involved in the development of their 12 or 13 stores -- don't quote me on the number -- and he worked with Save on Foods. He was a Jimmy Patterson boy from a very young man. He knows the game. Okay. He's the one that sold all of our strawberries. So he's really good. He understands the retail markets and have known Rick for a very long time, close friend and trustworthy gentlemen, absolutely, absolutely. Dr. Alan Boyco is the eye doctor for Vancouver Canucks and other sports teams and stuff, entrepreneur, strong mind, smart, everybody's just allowing me to get the job done right with all the checks and balances that we have in place.
Rick Easthom and Alan Boyco and myself, we’re on the audit committee as well. So before we change anything in our budgets, audit committee. Sarj Dhaliwal, our new CFO, she's a very strong money management. She likes bills to be paid. She is very strong and stern with money management, which is what we need. We weigh out every decision if we alter from the budget ever so slightly. It's a discussion because nobody wants to make any mistakes here and we’re there. We're not going to make any more mistakes. So we have her, our advisory board. Bo Slack that joined the advisory board, he's a 14-year veteran with Driscoll Berries and is now just currently signed on as, I believe he's a regional management with Giant Berry out of California.
So that's our guy here. He's helped us quite a bit with the packaging, which is all compostable and biodegradable, which is very cool stuff, has to be for ESG compliance, which is where we're going, and then we have Thomas Baumann, a professor, was the professor at the Fraser Valley University. He's an agriculture expert. One of Canada's top dogs in strawberries and is used in many court cases for certain things on his expert opinions on plants and stuff. So we have a pretty significant team. We have Natalie Hayward, she's also a consultant and she's been handling and helped develop out the website and helping develop our digital media and social media program, and we're getting ready to launch and become very active and interactive with our clients, with the consumers, because don't forget we're not selling stock anymore.
Okay. To hell with stock, we're selling strawberries, we're selling facilities, we're selling technology. We're selling ourselves basically but we're going to do a great job, right, and our stuff works, and when you put it in and it goes boom, everybody goes, how many… the biggest question that I've had is, okay, we give you $20 million, what are you going to do with the money? So we're writing that up right now. Okay. There's a whole bunch of money out there that really is liking this space. Doesn't show up in our stock. They're not allowed to, those big players, they're not allowed to touch 3 cents stock, to them it's pathetic, but what they are allowed to do is be involved in operations. When you get into revenue, that's the dinner bell folks, that is the dinner bell for microcap, revenue, contracts, launch tech, IP, and who doesn't want to be in the hottest spot in the world right now, food production.
SH: And finally, Nick, if there’s anything I’ve overlooked please feel free to elaborate.
NB: Well, I don't think so. I mean, you still look good from the last time we talked. I know I'm deteriorating as I speak. I've just said, I've been beat to death here on this deal. It's just been a lot of work, a lot of work, but honestly, it's been my pleasure to do it for Affinor, and I know I'm taking just a beating online at places, especially on your bullboards, but oh my God, if they only really knew me and they really knew what I'm doing right now, everybody's tempo is going to change soon. Actions are going to speak louder than words and I'm really, really excited to have had the opportunity to work with the board, the advisors and the consultants. Bruce Kahkesh. He joined the advisory board. He's a very high compliance officer in the financial communities very well respected in the mortgage lending industry.
To have people like that, that have my back now and that are pulling for us. It’s a real gratifying feeling. I'm not alone anymore. I got a team and I can feel the energy starting to propel around us now as we start to lift, the stock is way undervalued. The stock is so undervalued. I can only do so much but I'm telling you right now, I'm definitely doing my best for us, that's for sure.
For more details on the company, visit
affinorgrowers.com.
FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.