2024 was an active year for investment in regenerative agriculture and food, with more investors and funders seeking to engage in the space and the launch of several new investment vehicles. While one can argue there simply wasn’t enough capital flowing, it sure felt like momentum was picking up. RFSI covered much of the excitement and insight to go with it nearly every week in our RFSI newsletter. Here are the top read RFSI News stories of 2024.
1. Why We Need to Talk More About the Economics of Regenerative Agriculture
There can be no doubt that the regenerative agriculture movement is growing. With all this momentum comes increased awareness of and dialogue around the ecological, climate, and nutritional benefits of regenerative agriculture. Much less talked about, however, is the economics of regenerative agriculture and the important role of capital. There simply isn’t enough information about the economics of regenerative agriculture available today and that is holding the space back. Here are four reasons why we need to talk more about the economics of regenerative agriculture and the role of capital.
2. Proving the Potential of Agroforestry for Farmers, Investors, and Communities
Agroforestry ecosystem builder, Propagate, has built the foundation for agroforestry expansion in the U.S. and is now seeing their efforts pay off. In the past seven years of business, the company has grown from a concept around bringing the benefits of agroforestry to the U.S., to having planted more than 211,000 trees and shrubs since 2020. Today, as one of the most established and still fastest growing agroforestry project implementers in the U.S., they have learned a lot about how to build successful agroforestry operations that produce results for farmers and investors. Now, they are also learning more about how their work positively impacts ecosystems and communities.
3. Five Ways to Invest in the Stewards of Our Soil & Why It’s a No Brainer
The global industrial food system is characterized by extraction and degradation. It starts with soil on the farm, but the implications reach far beyond.
Those who steward our soil have a tremendous opportunity to positively influence this through practice change. However, within an agricultural system that was intentionally designed to maximize efficiency and output at the expense of the health of the underlying assets – soil, water, and air – farmers are being asked to internalize the costs of doing something different, something that will also benefit the greater good. This is one of several barriers to transition.
Equipped with an understanding of the benefits of regenerative farming and food systems – including the potential for positive economic outcomes – investment in this space appears to be a no-brainer. It can directly lead to improvements on the farm and for the climate, biodiversity, human nutrition and societal well-being, while serving diverse investment goals.
4. Terra Regenerative Capital Launches Fund with Unique Missing Middle Strategy
There’s a new fund on the block. Terra Regenerative Capital has launched its first fund aimed at closing a major gap in the regenerative agricultural system: the often overlooked and underfunded middle supply chain. The Leaders Fund – aptly named for the systems leaders it aims to invest in – has already invested $2 million in a demonstration portfolio and secured a $10 million anchor investment on its path to a $50 million final close. The specialized fund is led by a powerhouse team with deep sector and investment expertise whose sights are set on addressing a significant need in the domestic agricultural economy: connecting regenerative growers with the buyers and markets that want their products. With a systems-based investment strategy, Terra Regenerative Capital (TRC) is poised for catalytic impact.
5. 15 Key Insights from the 2024 RFSI Forum
With a sold-out crowd of more than 500 attendees, the 2024 RFSI Forum kicked off last week in Denver, Colorado. The program was packed with sessions to take attendees on a learning journey about the critical role of capital in building regenerative agriculture and food systems. From where we are today, to the investment tools we have at our disposal, to where we want to be – with greater market maturity and increased acreage, capital and impact for regenerative – the program was packed with insights as diverse as the stakeholders in the room.
Here are 15 (yes, you read that right!) key insights and reminders from the 2024 RFSI Forum program.
6. Canopy Farm Management Launches Midwest Agroforestry Investment Vehicle
Canopy Farm Management has launched a perennial crop investment vehicle, Second Story Farms LLC (2SF), to develop the next 1,000 acres of agroforestry in the Midwest. Backed by anchor investors – Zarpet Family Foundation, Zellis Family Foundation, and Matthew Zell Family Foundation – 2SF is targeting a $10 million raise and is uniquely positioned to expand agroforestry and its benefits in the region, while supporting the next generation of agroforestry farmers.
7. Accelerating Market Maturity for Regenerative Food Systems
Regenerative food systems provide the key to unlocking solutions for interconnected challenges of climate change, biodiversity loss, food and nutrition security, and income inequality. To create regenerative food futures, the world needs business and financial models that support sustainable, just, and secure food systems. Recognizing that the early stages of regenerative market maturity requires strategic deployment of catalytic capital to accelerate growth of the sector, Transformational Investing in Food Systems (TIFS) is building bridges between the worlds of finance and philanthropy to support this deployment. Here’s how they are doing it.
8. As Demand for Impactful Investments Grows, Iroquois Valley Farms Answers the Call
The importance of impact as an investment imperative has never been stronger. Worldwide, the size of the impact investing market has surpassed $1 trillion under management, according to GIIN. Investments in regenerative agriculture, particularly in farmland, can address the growing demand for solutions that deliver on climate, biodiversity, and public health benefits. So how is one of the oldest regenerative and organic farmland investors meeting the demand for impact and financial returns and what do their investors say?
9. Dirt Capital Hits $30M in Third Close for Impact-First Farmland Fund
Dirt Capital Partners, a real asset impact investment company with a unique focus on improving farmer access to land, has raised more than $30 million upon the third close of its latest impact first farmland fund. Investors include the Schmidt Family Foundation, Cienega Capital, The Woodcock Foundation, DF Impact Capital, Blue Sky Social Justice Fund, High Impact Fund I LP, The Mighty Arrow Family Foundation, and others. The fund is targeting a final close of $50 million at the end of the year.
The experience Dirt Capital has gained over the past 10 years positions it well to achieve great success with this latest endeavor. The fund – which has already invested over $8 million in 6 projects – applies Dirt Capital’s proven approach to customizing each investment to the needs of the farmer, creating multiple sources of revenue from the real asset investments, and structuring a path to farmer ownership from the outset.
10. Mad Capital Launches $50M Perennial Fund II to Scale Regenerative Organic Agriculture in U.S.
Mad Capital has launched Perennial Fund II (PFII) targeting $50 million to scale regenerative organic agriculture in the U.S. We had the chance to talk to Brandon Welch, CEO of Mad Capital, and one of the farmers they work with to learn all about:
- Why capital is so important to the regenerative organic transition.
- How PFII is filling a gap in the farm financing system.
- Who is already invested in the fund and why.
11. Bridging the Gap: How Strengthening Business Services Can Enable Systemic Transition
Farming is a challenging, capital-intensive business with slim operating margins and tremendous risk due to increasingly unpredictable weather and market conditions. For small and medium-sized farmers, balancing production work with the complexities of running a business is crucial for survival. But to be successful one must grow or build a good product (whether that be crops, services or something else) and be a good business operator, marketer, and sales representative. Clearly, while farmers may be driven by their passion for producing good food, they are often spread thin – managing finances, operations, and marketing can often take a backseat to revenue-generating work and crop production.
An emerging gap in the farming and food industry lies in the lack of resources to help farmers with business and marketing—areas that are not their primary expertise but are crucial for success. As these needs grow more complex, Good Roots steps in to fill this vital gap, providing the support that farmers need to thrive and to reach their full potential.
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