Last week, RFSI held our first in-person RFSI Europe event in Brussels – where we gathered 275 diverse agriculture, food, and investment stakeholders. From farmers, to start-ups, to food companies, to funders and investors, we filled two days with robust conversation around how to build regenerative food systems, where and how capital can play an enabling role, and the other ingredients that are necessary to expand the positive societal impacts of food systems transformation.
The insights were too plentiful to include all here but below we share nine key take aways from the gathering.
1. Farmers – and Relationships with Them – Must Be at the Center
The RFSI Europe program was crafted with the understanding that if you want to transform the food system, you need to talk to a farmer. And, if you want to fund the transition to a new food system, you need to talk to a farmer. As stewards of the land, farmers must be central to any conversation around investing in regenerative agriculture and food, regardless of whether capital is allocated to the farmer as working capital, to real asset investments in farmland, to new technologies or emerging brands, or any where else. This understanding was widely embraced in the room and was echoed from the stage by a variety of practitioners and investors working across the space. Here’s just a few examples of how the role of farmers is held central to this work:
After an opening session featuring four young farmers sharing what they needed from the ecosystem, Paul McMahon of SLM Partners shared the investment case for regenerative agriculture based on his company’s decade plus experience investing in the space. Drawing from their recently released white paper on the same topic, Paul made a clear data-backed case for how regenerative agriculture can be profitable and how this can drive investment returns. Notedly, he has shared that the greatest lesson learned for SLM Partners over the past 10 years was not about data or financial indicators but was the importance of the relationship with the farmer, something that has become central to SLM’s work.
In a fascinating discussion featuring a French emerging regenerative brand and a multinational food corporate, we heard from Joséphine Bournonville of Omie and Hannes Van Eynde of Danone, who both shared the critical role of building trust with the farmers that they source from. They also emphasized the role of having in-house agronomist teams to support these relationships.
Ivo Degn of Climate Farmers made the case for farmers being central and part of the conversation most bluntly at the close of the program. “We need them at the table and part of the conversation. Not talking at farmers but with farmers.” Without this participation, rules and incentives can be highly ineffective.
2. The Power of Food Cannot Be Understated
In a powerful conversation between two Wildfarmed founders – Andy Cato and Edd Lees – and Mad Agriculture founder, Phil Taylor, we were reminded of the immense power of food. We asked Wildfarmed to speak in the program because the regenerative supply chain that they have built is a critically important model of what can be done to both reward farmers and bring regenerative food to consumers. But the real impact of what they shared came down to their unique grasp of the power of food in our lives. Take home messages were plentiful and included:
Andy explaining his own journey to farming and how he planted some seeds and his subsequent feeling of joy and satisfaction when the food from this seed hit his table: He asked, “Why is this not the first thing and the last thing that we learn in school?”
Edd sharing that Wildfarmed was in reaction to the broken industrial model and them asking themselves: “How can we make it less anonymous than it is today in the commodity market?” Their response: create a path to transition, ensure there is a market for regenerative products and make sure consumers, buyers and growers want to be part of a community.
Andy explaining that most farmers have never eaten what they’ve grown and adding: “Never underestimate the power of a farmer being able to take their kids or grandkids to the bakery and say this bread is grown with our wheat.”
And finally, Andy warning us all not to underestimate “The number of young people who feel like they are living through a slow plane crash, and that their food choices are a huge source of agency”
All of this, reminding us of the deeply restorative power of food and food choices on so many levels.
3. Balancing the Tension Between Simplicity and Complexity
The food and finance systems are complex and building and investing in new approaches to these systems is also inherently complex. This was touched on in several sessions throughout the program – including two that looked more closely at systems-based approaches to investing and engaging in the space. The first of these sessions looked at the theory behind a systems approach to investing and how it can show up in an investment strategy, while the second looked at tools that can be used to assess where a farm, business, or fund is in their journey to a systems approach.
The complexity comes with not only the many diverse stakeholders involved in any one system – say the food value chain, for example – but also in the fact that the food system overlaps with so many other systems, including finance and policy. The deep complexity must be acknowledged and accounted for in the work being done in the space. Without it, we risk doing unintended damage to an already damaged system. But several people also brought up the very real risk that overemphasizing the complexity of regenerative agriculture and investing in it, can also serve as a deterrent to bringing more capital to the space. Anouk Schoors of The Nest explained, “Agriculture is complex by itself and so a lot of the systems change work is always set as ‘it’s super complex and it’s so big’. The more we insist on how complex the thing is, the more people will say ‘oh, it’s not for me, I don’t have the money, I don’t have the time.’” So how does she approach this at The Nest? With small steps. She explains, “You need to have a big vision and you need to be very audacious but then it’s a very practical approach of small steps in a day.”
In a follow-up to these comments, a session led by Tim Crosby of Transformative Investing in Food Systems (TIFS) dug into three assessment tools to help farmers, businesses, and funds evaluate where they are in their approach to systems change. Tim explains that tools like this are important to helping make systems-based approaches accessible by giving anyone in or entering the space a starting point and some direction on where to go next.
4. We Need More Data and Sharing of It
A call for data and measurement of regenerative outcomes was echoed over and over again throughout the program. There are a multitude of roles that data can play in advancing regeneration, including:
- Proving the economic case for on-farm adoption
- Supporting the investment case for regenerative agriculture
- Enabling food companies to better communicate to and build awareness and trust with consumers
With his insightful presentation framing the investment case for regenerative agriculture, Paul McMahon underlined the power of data (he had a lot) and the progress we have made in the past 10 years in building data that supports the space. Yet, the fact that benefits of regenerative agriculture and food are still not widely understood, indicates there is still a need for more … and more widely accessible data.
We heard about the lack of data being part of the rationale for some funders to not enter the space… or not enter it yet.
Separately, Hannes Van Eynde clearly stated why Danone and other multi-national corporates need data. “We need data to substantiate what we are doing and prove what we are doing, if we want to communicate at scale what we are doing” he said. But he warned, “Greenwashing is a true fear and something we need to avoid. This is where we hope technology can play a role. How do we streamline processes of getting data from farmers to us?” … and without overburdening farmers.
Which leads us to our next takeaway…
5. Technology’s Nuanced Role in Regeneration
Regenerative agriculture is inherently low tech and so what is the role for technology?
We dug into this question in a conversation between three players in the system who engage with technology in different ways.
Adele Jones of Sustainable Food Trust – a non-profit working to accelerate the transition to more sustainable food and farming systems, framed her vision for the role of technology when she posited, “We shouldn’t use technology to trump nature, we should leverage it to advance regeneration.” She explains that measurement, transparency, reporting and recording are a huge piece of the role sees for technology and will be transformative in next few years. She added that technology’s role to support farmers in being more resilient is also a key area for innovation.
Gaia de Batista of Just Climate – an investment business that focuses on climate solutions that can reduce emissions for the benefit of people everywhere, explained that their approach was to look at technologies that can scale the uptake of regeneration. She highlighted MRV (measurement, reporting and verification) technologies as a point of interest, as well as the ability of technology be leveraged to help those that aren’t first movers in the space be more comfortable to step into the space.
Simon Evill shared how his venture fund – Pelican Ag, which is bringing food and farming back to nature – seeks to invest in entrepreneurs and technologies that leads land and the supply chain toward regeneration. He shared how their strategy seeks to address root causes and, as much as possible, work with nature the way regenerative agriculture principles like holistic management do.
The conversation highlighted the complexity of both the philosophical and practical applications of technology to the space and is sure to continue to evolve.
Following this conversation, we heard from five companies innovating in the space in a pitch session hosted by The First Thirty. These pitchers demonstrated that innovation and technology can be applied to various parts of the ecosystem, however, the pitch session winner was Olombria – a company providing farmers with pollinator and pest control solutions using precision agtech.
6. Call for Stronger Political Leadership
Farmer protests across Europe (including Brussels the day before the event) have grabbed headlines in recent months and served as a backdrop to the entire conversation across the two days. They also pointed to the extreme misalignment of policy and regulation with the realities of farming in Europe.
Ivo Degn of Climate Farmers explained, “We see so many laws that are supposed to help farmers but we have huge farmer protests because they haven’t been designed with them. And then often they end up just simply being stupid.” He adds “We need to include the farmers that think long-term, think about policy ,and want to contribute.” He pointed to the European Alliance of Regenerative Agriculture (EARA) is an independent farmer-led coordination and political advocacy organization of the movement of regenerative agriculture at the European level as a group of farmers ready to engage in these conversations.
Christopher Knowles, independent advisor and formerly of the European Investment, also called for stronger political leadership to better facilitate regulation on the agriculture and finance sides to create systems that first stop incentivizing extractive and degrading agriculture and finance practices, and second incentivize and enable regenerative systems.
7. We Need More Than Just “More Capital”
There was a resounding understanding that we need more capital coming to the regenerative space but also a call for more than just more capital.
Christopher Knowles explained that he has learned that the space does “need something more than the traditional asset-backed approach” and Freija Vermeer, of DOEN Foundation went on to explain that she believes that, “there is a lack of patient capital, of capital based on trust but also of capital that really has a vision on systemic change.”
Chris expounded on why we don’t yet have capital at scale in regenerative food systems, including the nascency of the space, a shortage of “oven-baked opportunities” to fit traditional investor demands, and that we do not yet have the deployment capacity. He explained, “To make it (capital) move, we need to build the infrastructure,” – the people who can aggregate, simplify, and make investment in regenerative more accessible for larger pools of capital. Real assets – and managers like SLM Partners who are already doing this – are best equipped to do this at this point. But to bring more capital to the space we need to expand this type of infrastructure across the capital ecosystems and across the agriculture value chain.
8. Capital Collaboration Needs More Support
We are stronger and will accomplish more together. This was not only a theme of the event but an underlying vibe that was felt across the session rooms and hallways throughout the event. As an organization, RFSI sees collaboration as essential for us to create viable systemic solutions to food systems transformation. However, to reach collaboration, understanding the rest of the agriculture food and finance ecosystems is necessary.
In a session featuring a diverse group of end investors, Tessa Etkin-Silver of Be the Earth called out the lack of collaboration across different types of capital. She identified a lack of awareness of other capital providers and what they are working on as a key barriers and drew attention to the opportunity for an ecosystem map that could better enable this.
Freija took it one step further and explained that for her, capital collaboration will come when funders have a common language and understanding of what the ultimate vision for the space is and communication around how funding can enable that. Then, she explains, we can move to create blended financing solutions to address these.
9. Calling All Courageous Investors
Even with an understanding of the ecosystem and what stakeholders need, moving past conventional ways of doing agriculture, food and investment also takes a change in mindset and new approaches.
Michiel Lenstra of Wire Group explained that “We have to be humble as investors and know just how much systems change we can achieve just with capital.” He went on, “There is also huge potential but it comes down to attitude.”
Michiel helped close the RFSI Europe program with a call for courageous investors who are willing to approach things differently. “For capital to flow to the really difficult pieces of this transition, I think we need to build a tribe of courageous investors.”
The situation, he explained, is that despite that sometimes it’s not clear what the business case is because we’re still working that out, the investment needs to start now in order to get the transformation kick-started. He believes these courageous investors will need to be:
- Willing to take risks
- Be ok with the fact that we don’t necessarily know what financial flows are going to be
- Be accepting and embracing that at least the value creation and the value exchange will be 100% aligned with nature and local livelihoods.
These early adopters can come from all corners of the capital ecosystem and will play a key role in continuing to advance and scale investment in regenerative agriculture and food.
Did you miss the event? You can still be part of it and learn from all the presenters with the RFSI Europe Replay.
Learn more here.
Sarah Day Levesque is Managing Director at RFSI & Editor of RFSI News. She can be reached here.