John Kempf on AEA’s Recent Fundraise and Why Relationships Are Critical to the Regenerative Ag Investment Opportunity

Last week, renowned agronomist and regenerative farming guru John Kempf and his team at Advancing Eco Agriculture (AEA) announced a $4.7 million fundraise in both debt and equity financing – their first external investment. The raise was led by agriculture investor Tree Trunk Light, with other non-equity financing. Founder and managing director of Tree Trunk Light, Paul Bergman, was already executive chairman of AEA before the deal and will continue in that role.

Founded in 2006, AEA has worked to improve the agronomics and economics of North American farmers by focusing intently on soil and plant health. They do this through three pathways: technical crop advisory, plant nutrition and biological products, and plant health and soil analysis. Through these, AEA helps farmers transition to regenerative agricultural systems that “work in harmony with nature to create nutrient-rich, productive soils that feed disease-resistant plants.” And as a result of this system, farmers are able to reduce and often eliminate the need for herbicides and pesticides, while simultaneously improving the performance and profitability of their crop. To this point, AEA has worked on over 4 million acres with North American farmers. This new infusion of capital will support expansion of these efforts by growing “AEA’s first-in-class agronomy team, pursuing R&D trials in new and innovative areas of regenerative agriculture, and building AI and tech platforms that will bring regenerative agriculture decision making and best practices directly to farmers.”

Bergman says, “We are very excited to make this investment that will accelerate the expansion of AEA’s geographic footprint and outsized impact on food quality, yield and farmer profitability, through a holistic approach that combines regenerative agronomy expertise, with actionable data and ecologically minded plant nutrition products and solutions.”

The raise is the latest step for Kempf on his mission to make “regenerative agriculture become the standard status quo for more than 80% of the world’s farmers by 2040 globally” – a bold goal but one that he says is achievable if we all work together.

Bergman agrees: “John Kempf’s vision of transforming global agriculture is now embodied by AEA’s growing and most impressive team of regenerative agronomy professionals, who are collectively revolutionizing farming.”

RFSI had the chance to ask Kempf about his vision for scaling regenerative agriculture and what role he thinks investment will play in achieving global regeneration. Here’s our conversation:

Farming and agriculture have been a part of your life since your childhood, but what seeded your vision of “having regenerative agriculture become the standard status quo for more than 80% of the world’s farmers by 2040 globally.” When did you decide this would be your life’s work?

John Kempf (JK): My vision has evolved as I have become more deeply engaged in large scale agriculture. While natural ecosystems are extraordinarily resilient, and have an amazing capacity to recover from abuse, I have had this growing realization that many ecosystems are reaching a tipping point from which recovery may be very slow. Right now is the moment in time when we are able to reverse historical damage rapidly, that may be much more difficult in the future. This vision has developed gradually, with the realization that many of us have arrived here together for “such a time as this”. If not us, then who? If not now, when? Together, we can create the change we want to see in the world.

What role does Advancing Eco Agriculture (AEA) play in your vision?

JK: One purpose of Advancing Eco Agriculture is to demonstrate that regenerative producers are the high profit and low-cost producers that will thrive in the long term. Marketplace pressure will incentivize other growers to adopt regenerative practices to remain competitive with the more efficient regenerative growers.

A second purpose of Advancing Eco Agriculture is to set such a high standard of excellence in agronomic service and crop performance that other agronomy providers will need to step up their game to compete effectively.

Contemporary agriculture input providers often have very transactional relationships with the growers who are their customers. If we desire a truly regenerative agriculture, regeneration is much broader and deeper than regenerating soil health and cycling more carbon. We need to also regenerate farm profitability, rural communities, and landscape ecology. Most importantly, we need to regenerate our relationships. At Advancing Eco Agriculture we work to develop deep personal relationships with the growers who are our customers. We become their trusted advisors, their coaches, that guide them through a transition into a manner of farming that is currently unfamiliar. This approach to developing deep relationships is the antithesis of a transactional business model and is precisely what is needed to facilitate the adoption of regenerative agriculture on scale. It is this relationship approach that makes Advancing Eco Agriculture such a desirable company for growers, and really sets us apart from most companies in the space.

If you are unwilling to assume risk, and only want to make safe investments in farmland and real assets, you are not the supporter regenerative farmers need. You are unlikely to have a significant impact on regenerative agriculture as a whole.

Outside of investment in AEA of course, what role do you see for capital investment (in general) to play in helping achieve your vision?

JK: This relationship model of business is less appealing to investors who care exclusively about economic returns because it is not easily scaled 100x in 3 years and doesn’t offer the opportunity for the returns VC’s (venture capitalists) are usually looking for.

Relationships between investors and the farming community they wish to support also needs to be regenerative, not transactional. Perhaps this means investors listen to farmers needs as primary when developing investment strategies, rather than considering economic returns as primary, and farmer needs as secondary.

Capital investment is needed to support growers who want to make a transition to regenerative production in a number of areas, particularly to facilitate market access. Regenerative agriculture needs investors who believe in the vision and are willing to invest in more than just low risk land investments. Regenerative farmers don’t need more investors willing to invest only in safe land, and not in infrastructure. I expand on the investment opportunities in my interview with Koen van Seijen.

Having fundraised (and I believe investing on your own) and understanding your ambitious goal for global transition…what would you most like to tell investors who are interested in the space?

Regenerative agriculture needs investors who care about impact, and who are willing to take risks. For investors willing to take on small amounts of risk, the opportunities to make an exceptional impact are abundant. If you are unwilling to assume risk, and only want to make safe investments in farmland and real assets, you are not the supporter regenerative farmers need. You are unlikely to have a significant impact on regenerative agriculture as a whole.

Sarah Day Levesque is Managing Director at RFSI & Editor of Raising Regenerative News. She can be reached here.