farmgirl flowers is making a dent in floral

[WillieeArmellini]

source: https://www.bizjournals.com/sanfrancisco/news/2017/10/20/farmgirl-flowers-picks-fresh-fast-100-2016.html

Farmgirl Flowers

Rank: 15

Growth: 431.3 percent

What it does: Ecommerce flower company

CEO: Christina Stembel

HQ: San Francisco

2016 employees: 67

2016 revenue: $10.13 million

2015 revenue: $4.45 million

2014 revenue: $1.91 million

When Christina Stembel started her company, Farmgirl Flowers, in 2010, she wanted to disrupt the traditional flower industry by offering designer bouquets geared toward a younger audience. She promised to buy blooms from U.S. farmers only. She wanted to build awareness that most of the flower delivery industry relies mainly on South American imports. For Stembel, it was personal: she grew up on a soy bean and corn farm in rural Indiana.

Her dream of buying flowers only from U.S. farmers ended up wilting on the vine last year. Many large-scale U.S. growers refused to work with her because wholesalers and industry heavyweights threatened to take their business elsewhere if they sold to her. She said her success as an upstart with a “Buy USA” model threatened the traditional flower industry’s business model.

That industry wastes about 40 percent of the flowers they buy, she said. With great pain, Stembel flip-flopped last year on one of the company’s biggest promises, to buy only from U.S. farmers, because the demand for her flowers was outstripping her U.S. supply.

“I learned that many large-scale growers weren’t willing to change that model and sell directly to us,” she said. “We will always be loyal to the many American farmers who will work with us, but I’m not going to stunt my company’s growth.”

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That growth has been robust. From 2014 to 2016, the startup saw a 431.3 percent increase in revenue, from $1.9 million to $10.1 million. In 2016, it outgrew its 9,000-square-foot warehouse, where it does in-house assembly of bouquets, in SoMa. It then moved into a 14,500-square foot space in Potrero Hill and increased its workforce from 41 to 67. By the end of the year, it will have 80 to 90 employees, including bike couriers who deliver flowers within San Francisco and earn good salaries with full benefits, 401(k) and paid vacation.

The company’s next move for its assembly site may be to the East Bay, where it’s more affordable to operate, she said. By 2018, she also plans to open a distribution center on the East Coast, doubling her employee count. And she is considering obtaining venture capital funding from the right kind of partner, who shares her core values, she said.

Stembel started Farmgirl out of her one-bedroom apartment in San Francisco’s Russian Hill neighborhood with $49,000 of her own funds because she hated the flower buying process and wanted to partner with local farms to offer higher-quality bouquets.

“Every time I would send my mom flowers, I hated spending an hour looking through all the options just to find the least-ugly bouquet, and a lot of times what she got looked totally different from the photo,” Stembel said. “It didn’t look like anything I would be proud to send her.”

Robert Kitagawa, CEO of Santa Cruz County-based KB Farms, says he’s worked with Farmgirl for the past five years and considers it a “partnership.”

“They are very sincere,” he said. “It truly is what they feel and what they believe in.”

Stembel said she felt a little lost after giving up on her dream of offering 100 percent American flowers, but Farmgirl has an option for customers to specify if they want U.S.-grown flowers only. It also vows to buy the majority of its flowers from U.S. growers, and only use international growers if U.S. supply is maxed out.

“Our long-term goal is to build a billion-dollar company we can feel proud of, while holding onto our core values of integrity, creating good jobs, and supporting nonprofits and as many growers as we can,” she said.

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