Partners growing mushrooms in former shipping container

Posted at 1:46 PM, Jun 19, 2022

GRIMES, Iowa (AP) — If there is one thing that excites Josh Peitzman, it’s the promise of rain.

A saturated forest floor is a fungal breeding ground, and Peitzman, 24, spends much of his free time post-rain on the hunt for mushrooms to identify. It’s become second nature for him to walk through Granger’s Jester Park, eyes on the ground or in the nooks and crannies of trees, in search of something new to discover.

For a time, this hobby — which began five years ago — was just that. The self-taught mycologist foraged and identified, learned the taxonomic names of the species he’d uncover and eventually started tinkering with mushroom grow kits and still airboxes. Soon, however, he began picturing a future beyond his dishwashing job at Wasabi in Ankeny — a future in which he’d cultivate his own mushroom farm and fulfill a longstanding dream of following in his grandfather’s farming footsteps.

That mushroom farm, Fungi Fresh Farms, is now a reality. With support from investor-turned-business partner Jerrod Appenzeller, Peitzman is determined to grow the largest gourmet mushroom farm in central Iowa in a renovated shipping container in Grimes. The Des Moines Register reports that just months into production, Peitzman and Appenzeller are harvesting 50 to 100 pounds of specialty mushrooms per week for local farmers markets, restaurants and CSAs (community-supported agriculture farm operations), but the two say it is just the start.

Peitzman grew up in Grimes on land his grandfather once farmed. Much of the original 400 acres was sold off before Peitzman’s own agricultural leanings took hold, but the remaining portion in his family’s name is where his childhood home, and now Fungi Fresh Farms, sit.

“With us doing this here, I feel like it’s our chance to kind of save that farm,” Peitzman said.

The fungi kingdom is intrinsically connected to our own. They are decomposers and life bringers, creating conditions for plant and animal life to flourish, inconspicuously coating much of the planet. We recognize them as mushrooms or mold or actors of fermentation in our favorite wines and beers. They’ve been harnessed for good as antibiotics, and some species are even capable of cleaning contaminated areas.

Many in Iowa forage as a pastime, most notably around morel season in early spring. But according to the Iowa State University Extension and Outreach division, more than 50 known species of mushrooms — some edible, some not — grow regularly around the state.

Mushroom farming requires significantly less space and land than other forms of agriculture, and many of the materials the partners use to grow their products are compostable.

“It’s amazing for us to strike this now,” Appenzeller said. “It’s a modern farm for modern demands.”

Appenzeller, 35, works in quantitative data analytics for Wells Fargo and recognized Peitzman’s drive, potential and obsession with all things fungi. He offered first to invest in Peitzman, but progressively the two were making business decisions together and realized a partnership was the best way forward.

“For me it was really valuable to run into somebody who saw the same vision that I did because it’s such a rare thing,” Peitzman said. “Not only do you have to be careful who you share your vision with, not everybody is going to see exactly what you see.”

Over a coffee meeting in 2021 to discuss potential work opportunities with Appenzeller’s sustainable vegan supplement company, WildHeart Nutrition, Peitzman’s budding knowledge of the fungus kingdom met Appenzeller’s entrepreneurial spirit and business acumen.

“My interest was sustainability and sustainable agriculture, so when our streams mixed, it was perfect,” Appenzeller said. “(Mushrooms) are basically nature’s recyclers. They take inedible bio waste products and turn it into a source of protein, vitamin D, carbohydrates and adaptogenic compounds.”

The meeting quickly turned toward Peitzman’s passion for foraging and identifying mushroom species.

“If you can’t tell, he just loves mushrooms,” Appenzeller said. “That’s how I knew this would be a good investment and a good person to partner with.”

In their next meeting, they would lay the groundwork for Fungi Fresh Farms.

In his free time as a teenager, Peitzman spent hours hunting for geodes in a creek about a mile from his house, cracking them open and hauling them home in a backpack. One such trip led to a new discovery — along the mossy bark of a fallen tree, a cluster of smooth, brilliantly yellow mushrooms with undersides of rippling gills was growing toward the sun.

“It was breathtaking,” Peitzman said. “It was like seeing a flower that you had never seen before.”

They were golden oyster mushrooms, scientific name Pleurotus citrinopileatus — what Peitzman would later come to understand as “choice edible” mushrooms. Their springy, delicate caps have a fruity aroma and take on a velvety texture when cooked.

Peitzman was hooked.

He started reading everything he could get his hands on, sometimes sitting among the stacks at bookstores with books on mycology, flipping through pages he couldn’t afford to take home. Peitzman opted not to attend college, but felt a sense of responsibility to continue learning. He memorized the periodic table of elements by drawing it in his shower and dove headfirst into mushroom taxonomy by trial and error and compulsive foraging.

When he wasn’t obsessively memorizing the gill patterns and spore activity of various mushroom species, he threw himself into other hobbies he felt provided a different sort of education — namely, Brazilian jiujitsu. Through time on the mat, he met and befriended Appenzeller, a 17-year practitioner of the grappling sport.

A lot of what happens on the mat is a mindset, and both men have carried it over into their business model.

“With jiujitsu, you’re constantly refining every day. You still get tapped out by somebody, and you have to then make a correction,” Appenzeller said. “So it’s very humbling, and you learn to always question your own knowledge on the topic.”

Standing in the Fungi Fresh Farms lab is a markedly different experience than wandering the woods.

After the 40-foot Costco shipping container was dropped off in its new home in Grimes, Peitzman and Appenzeller got to work building it out for both a lab and grow space. What they imagined would take 30 days drew out to nine months of creating the perfect conditions for mushrooms to flourish. Working in negative temperatures through the end of 2021, they installed state-of-the-art HVAC and climate-control systems, added insulation for year-round growing capabilities and separated the space into 25 feet of vertical grow room and 15 feet of lab.

Peitzman keeps the lab side sterile, with a large flow hood hovering over his workstation — necessary to control the movement of spores during his transfer process. He spends hours in the tight space, all walls except for one small window overlooking the neighboring farms, built-in at his request.

The muddy commute from his parent’s backyard to the lab means Peitzman often works in socks as he transfers mushroom tissue onto agar plates or injects a growing medium with a liquid tissue product. From there, he expands the mushroom tissue onto sterilized grain bags that, in the correct environment, will eventually blossom with mushrooms. When the inoculated grain bags have incubated, they are moved into the grow room and monitored for humidity and carbon dioxide.

In nature, mushrooms reproduce through puffs of spores that find their way into moist crevices to eventually replicate. It requires near-perfect temperature, moisture and sunlight conditions, which can be unpredictable.

“The chances (of reproduction in nature) are one in millions,” Peitzman said. “In the lab, what we do is we take those chances from one in a few million to one and one, or around 98% efficiency, and how we do that is by keeping everything very sterile.”

In total, they can produce 14 different species of mushrooms. But right now, Fungi Fresh Farms is focusing on producing three main types of mushrooms: Lion’s mane, blue oyster and black pearl king oyster.

Peitzman and Appenzeller plan to adjust their growth schedule with the seasons to provide a year-round supply that works best with the outdoor temperatures and maximizes energy usage in the grow room. They also sell mushroom grow kits to mycology-curious customers who want to try their hands at farming.

Some of the bouncy, freshly harvested clusters go to Wabi Sabi Farm owner Ben Saunders, who brings them to the Des Moines Downtown Farmers’ Market every week and packs them into CSA boxes alongside his farm’s produce.

“They’ve been great to work with, and it seems like they know what they’re doing,” Saunders said. “I’m excited to keep working with them.”

For Peitzman and Appenzeller, it’s been exceptionally rewarding to see their mushrooms feed the community and learn about how customers have incorporated them into meals.

“Our whole idea is fresh, local, sustainable, delicious mushrooms and that’s something that people are slowly getting thrown on to the idea of... mushrooms that aren’t these slimy button mushrooms that are in little plastic wrap things and are not fresh at all,” Appenzeller said. ”(Fungi Fresh Farms) mushrooms can really be your main course.”

Customers of Veggie Thumper have experienced firsthand the benefit of locally grown mushrooms thanks to the vegan food truck’s relationship with Fungi Fresh Farms. Owner Lyssa Wade has created hummus wraps with oyster mushrooms and fried “chicken” from chicken of the woods foraged by Peitzman.

“I feel like (locally grown mushrooms) have a longer shelf life, better flavor and you can ask questions about the substrate that they were grown in and where they came from,” Wade said. “And they’re not covered in pesticides and other random things.”

As their client base continues to expand, Peitzman and Appenzeller are planning to ramp up production, potentially by hundreds more pounds of mushrooms a week.

“I think the most rewarding part about it is knowing that I get to do something that I’m passionate about,” Peitzman said. “I spend a lot of weeks working six, seven days a week, but I wouldn’t trade it for anything else.”

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