John-Paul Maxfield is on a mission to transform our agricultural systems. Through the challenges of COVID-19, his company is working toward major breakthroughs in the advancement of mycology, soil, and how we grow.
John-Paul Maxfield thinks there is a problem with the startup mindset.
Typically, when entrepreneurs land on a good idea for a product or service, they go out and raise money to fund it. What follows is a mad dash to make that idea innovative, disruptive, and scalable, burning more and more cash to make up for any mistakes along the way. It is a drive for a high valuation instead of, say, long-term value creation.
“A lot of startups fail because they define themselves by the products that they sell,” said Maxfield. “But we don’t need more products. We need more people bringing their unique expression to the world.”
For Maxfield, his expression is Waste Farmers. After graduating from CU Boulder in 2003 and working in private equity, he launched the company in 2009 as a Denver-area composting service. The one-man business collected food waste from local restaurants and schools and turned it into organic compost, later adding soil amendments, fertilizers, and soil inoculants for agriculture markets. Soon, his garage operation moved into a 14,000-square-foot yard and warehouse, where he and a small team started producing thousands of units per year. It was all part of their push toward a more sustainable food system, starting with rebuilding its most foundational component: soil.
However, he soon realized he didn’t want to build a business simply around collecting food waste.
“Entrepreneurs are known for chasing the next new thing and not taking the time to grow a company. That’s not me,” said Maxfield, CEO and founder. “I’m looking at a 100-year trajectory, not an exit in three years.”
Building Capabilities Out of Products
In 2011, Waste Farmers sold its compost-collection routes to Alpine Waste and shifted toward a new direction: building a new agricultural innovation system. But it required more money. During a $350,000-round of fundraising from friends, family, and angel investors, Waste Farmers pitched to the Rutt Bridges Venture Fund, the Jake Jabs Center’s student-run venture fund. In October 2011, it joined the CU Denver program’s portfolio of investments.
Over the last decade, Waste Farmers has rapidly grown into a sustainable agricultural conglomerate with a portfolio of businesses. It now mainly operates out of its office in Battery 621 and a “Microbe Brewery” in Western Colorado. They move hundreds of thousands of units of product each year, ranging from consumer potting soil and organic produce (under the brand Maxfield’s) to feedstock material, indoor production, and other commercial farming needs (Batch 64).
“We didn’t start out with potting soil,” Maxfield said. “We started out doing various other things around agriculture, and those capabilities led us to potting soil, which built into building capabilities, and that’s how you grow. That’s our regenerative and organic approach.”
Today, Waste Farmers is defined as a regenerative holding and operating company, as well as a certified B Corporation. In other words, it’s committed to the “highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose” — specifically in the realm of sustainable food and agriculture practices. Their goal is to build a portfolio of people, brands, and businesses that are transforming “emerging social and environmental needs into market-based opportunities.”
Its current mission wasn’t developed overnight. Rather, it aligns with the essence of a company that is constantly evolving with its team, customers, and environmental needs. More importantly, it is a result of years of growing pains and developing a holacracy.
According to Maxfield, 2019 was a year of intense growth for the company. It had achieved a compound annual growth rate of 62% since it started and surpassed $3 million in annual revenue. However, they felt bogged down by structural and internal issues that created dissonance within the organization. Their biggest mistake was losing sight of their customers, he said. Their rapid sales growth led them to seek internally driven solutions, which created shocks and setbacks to their core mission. That is why Maxfield reached out to Carol Sanford.
The business educator, thought leader, author, and executive producer of The Regenerative Business Summit helped Maxfield and his team realign and transform their mission and its implicit expression into an explicit manifestation. At the end of this recalibration, Waste Farmers achieved its best quarter in its history at the start of 2020.
“Carol is a godsend,” Maxfield said. “We’re finally at a place where our core is on solid footing and we’re capable of funding growth. And that’s what we’re really excited about: advancing the citizen science around mycology and finding more of its beneficial applications.”
A Pandemic’s Shock Value
The timing couldn’t have been better. Just as Waste Farmers finished its best quarter ever, the global economy was slammed by the outbreak of the COVID-19 pandemic. In retrospect, Maxfield believes his company wouldn’t have been able to navigate its unprecedented challenges without the groundwork they covered in 2019.
“Moments like these, these shocks, invoke a level of focus and immediacy,” he said. “In a way, I am grateful for what’s happening right now. It reveals various weaknesses and systems that you have to change and build upon. The tendency is for people to say, ‘This is happening because of COVID or xyz.’ But no, it’s not. COVID is not creating problems; it’s highlighting problems that already existed. … This will pass, and there will be strength and resiliency created by and through it.”
For Maxfield, the success of his company is rooted in its ability to adapt and change with a group of people who are in it for the long haul.
“We need to encourage people to keep going and build companies, not just start the next new thing,” he said. “That’s just making rich people richer. We need to celebrate company builders. … So keep asking yourself: What are you passionate about? What do you want to wake up for? And then go create it. Don’t get tied to one path. Be adaptable, because things take twice as long and cost twice as much as you’d think — which is a good thing.”