January 13, 2021

Warehouse build out for Chesed Farms

Walla Walla, Washington

Warehouse build out for Chesed Farms

Chesed Farms began growing specialty mushrooms, such as lion’s mane, shiitake, and chestnut, out of co-owner Sundown Hazen’s garage in April 2020. Their business grew quickly, helped along by a solid business plan and capital to let them expand.

Sundown first learned about Craft3 through an online search for local funding options for his startup food business. When he reached out in late 2019, a Craft3 lender recommended he work with the local Small Business Development Center on a business plan. Sundown did just that and by mid-May 2020, Sundown and Jonathan Garrett, co-owner of Chesed Farms, began selling their mushrooms to local health food grocers and high-end restaurants. Remarkably, they consistently sold everything they produced and there was more demand for their products than they could satisfy at that time.

By late 2020, Chesed Farms had a solid business plan and was ready to apply financing. Sundown worked closely with a Craft3 lender who saw the value in business and also helped question his numbers and projections. For Sundown, “Having another perspective to imagine scenarios that weren’t part of our vision, but that could get in the way of that vision was helpful.

A small loan to fund materials and equipment to build out a 4,000 square foot leased warehouse space let Chesed Farms drastically increase their growing capacity. Craft3 did not shy away from a complicated ownership structure (Sundown’s company rather than Sundown himself is an owner of Chesed Farms), no collateral, or the fact that repayment capacity was based 100% on projections. These risks were overshadowed by the determination of Jonathan and Sundown, by their commitment to build an innovative business, and by their focus on sustainability.

Once fully launched in their new space, Chesed Farms really took off. Today, Chesed has six full-time equivalent employees and is producing micro-greens, offering permaculture-inspired landscaping services, and soon dehydrated fruit, herbs, and mushrooms. It has more than doubled its wholesale customer accounts – including several in the nearby Tri-Cities region – and is under negotiation to sell to several institutional buyers. They paid off their Craft3 loan early and under purchased 14 acres with a greenhouse using FSA financing.