Investing in Regenerative Agriculture and Food
Brandon Welch, Perennial fund, investing and profit sharing to get farmers to organic and beyond
Transition finance is key to help many more farmers and growers start the transition to organic and regenerative. The Perennial Fund is going to experiment with a new concept!
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The Perennial Fund invests $75-150 per acre per year into the farm
- For 3 years to transition to organic
- In exchange for a 10-25% net profit share after they’re certified organic
- Until 1.5x the initial investment is returned
The per acre investment amount is determined by the overall capital needed to facilitate a successful organic transition. Farmers do not pay back the fund until they are making net profits. The expected IRR is 9% over 10 years, though successful payback is conservatively expected to take 5 years. If the investment is not repaid at 1.5x after 10 years, the remaining amount owed will be forgiven.
A key piece is the market access, Pipeline foods (we have interviewed Eric earlier) buys the crops in the 3 year transition and provides a long term off take agreement for the organic crops
All links and show notes here:
www.investinginregenerativeagriculture.com/2019/07/13/brandon-welch.
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The above references an opinion and is for information and educational purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.
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