Investing in Regenerative Agriculture and Food
Investing in Regenerative Agriculture and Food podcast features the pioneers in the regenerative food and agriculture space to learn more on how to put our money to work to regenerate soil, people, local communities and ecosystems while making an appropriate and fair return. Hosted by Koen van Seijen.
Investing in Regenerative Agriculture and Food
401 Bart van der Zande - A venture studio is the solution to all our regenerative challenges
How to get more entrepreneurs building in the regeneration space? If you are a regular listener of this podcast, you have heard us discuss this so many times you probably lost count. No, we are not saying entrepreneurs and companies are the solution to all our problems. But entrepreneurial people who set up companies, but also non-profits and movements— basically people who don’t accept the status quo and get to work to change it—are always the ones who change the world.
So how do we get more of those started in the biggest challenge of all: how to regenerate a severely degraded world? And when people get bitten by the “soil” bug, how do we give them all the support and resources to make sure the chances of them succeeding against most odds are as high as possible? Or, in the words of Bart, how do we create the best enabling conditions for them and others to succeed?
==========================
In Investing in Regenerative Agriculture and Food podcast show we talk to the pioneers in the regenerative food and agriculture space to learn more on how to put our money to work to regenerate soil, people, local communities and ecosystems while making an appropriate and fair return. Hosted by Koen van Seijen.
==========================
👩🏻💻 YOUR OUR WEBSITE
💪🏻 SUPPORT OUR WORK
- Join Gumroad
- Share it
- Give a 5-star rating
- Buy us a coffee… or a meal!
==========================
🎙 LISTEN TO OUR PODCAST AND SUBSCRIBE TO OUR CHANNEL OR WATCH IT ON 📽️ our YouTube channel
==========================
FOLLOW US!
==========================
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.
Thoughts? Ideas? Questions? Send us a message!
Use KOEN10 for 10% off
Find out more about our Generation-Re investment syndicate:
https://gen-re.land/
Thank you to our Field Builders Circle for supporting us. Learn more here
Feedback, ideas, suggestions?
- Twitter @KoenvanSeijen
- Get in touch www.investinginregenerativeagriculture.com
Join our newsletter on www.eepurl.com/cxU33P!
Support the show
Thanks for listening and sharing!
How do we get more entrepreneurs building in the regeneration space? If you are a regular listener of this podcast, you've heard me discuss this so many times. You probably lost count. Now I'm not saying entrepreneurs' companies are the solution to all our problems. But entrepreneurial people who set up companies, but also nonprofits and movements basically who don't accept a current status quo and get to work to change it, are always the ones who change the world. So, how do we get more of those started in the biggest challenge of all? How to regenerate a severely degraded world? And when people get bitten by the soil bug, how do we give them all the support and resources to make sure that the chances of them succeeding against most odds are the highest? Or, in the words of Bart, how do we create the best enabling conditions for them and the others to succeed? Enter the Venture Studio. We've had Bart Van der Zun, the co-founder of the Fresh Ventures Venture Studio, on the show twice before. And it was really time for a check-in. They've run three cohorts now and built over ten regen focused companies, and are gearing up for their fourth cohort. We talk about the venture studio model and what's holding back the sector. More early stage funding. But also why it is so difficult to get early stage funding into the space. Everyone who's done a quick back-on-the-envelope calculation on, let's say, the characteristics and fundamentals and modeling of a fund to focus on early stage quickly figures out that small tickets don't really make a lot of sense. So, how does BART think they can make it work? We also talk about the best place to look for real region innovations on leading regen farms. But what happens? Usually, a super forward regen farmer invents something that works for him or her. Let's say a very special bioteed compost extract sprayer, which fits, by the way, on the existing cover crop planter. And then it stops there. Maybe he or she will make a few for their neighbors. But it's pretty much it. How do we commercialize and more importantly, spread the super context-specific but super relevant region innovations? Again, the answer is entrepreneurial people who set up companies around the inventions where the farmer can choose how they want to be involved. Join us talking about how we get more entrepreneurs building relevant ventures in the regenerative food and agriculture space. This is the investing in regenerative agriculture and food podcast, where we learn more on how to put money to work to regenerate soil, people, local communities, and ecosystems while making an appropriate and fair return.
SPEAKER_00:So welcome to another episode.
SPEAKER_01:I stopped saying special because they're all special. So none of them is. I realized this is the third one we're doing and the first one in person, which is interesting. So welcome back on the show, Bart, one of the co-founders of Fresh Ventures. We talked about you and Fresh Ventures, I think, a lot as we love to double-click on the opportunities in this space, what needs to be built, how does it need to be built, and how do we do that more? How do we get more entrepreneurs or entrepreneurial people into the regeneration space at large? And one of the examples is through Adventure Studio. And we've, I think, mentioned it many times. It's been a while since you were on. It's 2023, the beginning was before the second cohort. So it's quite a it's a few years ago. We're now recording this the end of November, 2025. So whenever you listen to this, just to give you a bit of context. And we're sitting in the amazing Blue City space. Shout out to Walmart of here. The weather outside is a bit gray and wet, but we see a lot of lovely boats passing by. Very good. And some bikes, not really, and some runners that are very brave. So we might have some background noise here and there as we're in the lab, but they promised us they're not gonna hammer things for the next hour or so. So we'll see if that happens. But of course, people are building things, literally, so that's important. And yeah, we're gonna have a free-flowing conversation about many things. And one of the big pieces is how to get more aligned money into the space. How do we get big money small, which was the end of our conversation last time? We had, I think, three sentences about it, and it deserves way more attention, what is needed to not only to build these ventures, but also to get great support, financial support, and other resources to them at the right time and just increase their chances of success. So welcome back. Was a long intro and uh looking forward to unpack. Nice. And just to start, because people are gonna say fresh ventures, we'll put the other conversations obviously in the show notes, but just in a few sentences, maybe the summary has changed slightly as well. You're approaching your fourth cohort early next year, 2026. Definitely sign up. The applications are still open or are opened. So if you're up for that, please do. You're doing an online version as well. But for people that are like fresh ventures, what's adventure studio and how does how does it make sense in the region world? Just a short reminder for them, just to get everybody on the same page.
SPEAKER_02:Yeah, thanks. Intro. Really cool to be in in each other's presence. It's uh it's a different dynamic for sure, but a lot better. Yeah, fresh. So to start us off, I would say I think we we see that there's change needed in the food system. I think most of the listeners already uh recognize that, but that there are not enough organizations emerging and surviving, I would say, that really are focused on this food systems change. And yeah, we'll talk about systems change later, I think, but we're trying to build these organizations. So, well, we are a talent and a venture-building studio, and we're on a mission to transform our food system, and we build new businesses where possible, as much as possible, steward-owned or alternatively structured. So we build these businesses, but also the talent pool increasingly, as we need a lot of people working in this space. Some of them build a venture, others land in other interesting positions, and due to this, I think we help bring this space into existence, I would say, together with the many people you also had on the podcast. And while doing so, we also start recognizing that we are also helping build the enabling conditions that are needed to drive these changes. So, very simply put, we bring together great people, we continuously ask what should be built, we talk to the ecosystem, we do our own research, we find opportunities, increasingly also farmer-led. Maybe we can talk about that later as well. And we combine that, we bring that together into, I would say, mostly our let's say, flagship program, which is a three-month period where 25 people are selected out of 300 applicants to come together. And I think now I start recognizing even more how special not per se our program in that sense is, but the fact that 25 people that are selected on the fact that they are dead set on starting something in the space are fully committed to do so, have cleared their agenda for more than three months. Often we say it's a three-month program, but be ready to have another year at least to spend on it. Maybe you go back to a job. But anyway, the intention for all these people is let's build something. And the average age is 37, so it's experienced people with this intention, value-aligned, coming together. Even if we would do nothing, it would already be great, basically.
SPEAKER_01:I think even if you wouldn't have a program, basically, they would probably build something.
SPEAKER_02:So the first programs, I was like, really, oh, we need to how are we gonna do this? And we program a lot, we do a lot, right? We actually do approach.
SPEAKER_01:I've been to a few, I've been to a few, is not I've been involved and hung out, let's say, during those some of those weeks. We were lucky enough in some cases to to be in in Rotterdam at the time, and the energy and the intensity, like it's a four-day program, the fifth day is catch up with other things and stuff, and it's early morning to late. Not because you force them to do it, but be these people are very hungry for info, for learnings, for validation, for testing, and it's just it's exhausting to be around basically because the pace is just so intense. Yeah. And but it and it's probably a bit like when you put 25 people like that together, it just becomes quite a uh an interesting flow of okay, let's figure out what needs to be built, how we're gonna do that, let's test, validate, let's kill darlings early. This is not a path that really works, which of course you can do by yourself, but it's just really interesting, like how that you maybe find co-founders, etc. But the energy around it is it's a three-month pressure cooker, basically, from yeah, basically from Monday to Sunday and everything in between. And most people do that to themselves because it's not that you program the whole thing full, you literally also push on slowing down, etc., making sure you have time to digest, and some very interesting ventures come out of it, which is yeah, which is such an interesting piece because we keep repeating that over and over on the podcast. We need more people in the space. And every time I type that, actually, something corrects it to we need more people in space, which I don't think is Apple. Please stop doing that. It's also relevant, but and we need them with the right structures around them that they can build something. That cannot that doesn't always have to be a venture, it could be a nonprofit, it could be a lobby organization, could be, but with the same, let's say, entrepreneurial mindset of scale, impact, and integrity. And it's yeah, it's working. If three cohorts under your belt and the fourth is coming, there's an online version now. There's a lot more in the ecosystem than when we last talked in in February 23. And so I'm I'm very excited to see again what talent is showing up this time. Because it could also be that the talent pool is done, but I don't think that's the case. I mean, it's always a fear with these programs. Okay, the first time we had a great group, amazing. We had three, four companies coming out of these ventures, and then the second group showed up, which actually was it's an important point, I think the 37-year-old average with experience. This is not for people running coming out of university. This is for people that have done things elsewhere.
SPEAKER_02:Yeah. Yeah, and I think that's maybe also well, there's two things maybe while you're saying this that wasn't really a question that we have progressed on is on the one hand, it's very important to bring people into the space in this entrepreneurial energy. A lot is happening in when someone steps into this intention and clears their agenda and starts doing this, right? So it's about starting a company. Well, at least half of them, most often more, have already done that, right? So they they can explore it and they know what to do, but it's also personal transformation. So if we talk about yes, we need more entrepreneurs in the space, but we also, on the from the other perspective, we need more entrepreneurs that are have a deeper connection to nature, have let's say a regenerative mindset, or have really step into that paradigm.
SPEAKER_01:Do you screen on that, or do you, and if so, do you actively help people with that? I think it's one of the biggest differentiators that we see is if people it's not the right wording. If you have better wording, please reach out. But if you realize that you're part of nature and that comes with a certain humbleness, or that you are in control or seem this, think you're in control, etc. Do you somehow screen on that, or do you somehow and/or do you bring people through that realization?
SPEAKER_02:Yeah, a bit of both. So actually, we're fores it correlate with success, I think is a technical. Yeah, that's an interesting question. Well, we actually had an interesting question at the soil hangout with some people on this topic, and we're trying to formalize, let's say, the profile of what is a regenerative founder. And I think we've learned a lot about if that would be a diagram, basically, right? What are all the things not per se you can score on only, but also as an individual, also for myself, basically, what are the things that are what are your growth paths, right? Where is your where do you where can you grow? And for some people, it's very much on let's say also the commercial side or building organizations. Being a good founder is about yeah, being a good founder. There's traits to that. There's we already know how that works, right? But what is then the regenerative side of that? What are the elements that create a different type of founder? And I thought it was interesting at the um Soil Hangout, but also in other conversations, also with a few funders, it's about sometimes funding someone, let's say which is a fully regenerative founder, and then often it's very trust-based, also, right? There's and then we had this conversation, but yeah, but that is this type of founder, right? That's this guy or this woman, and but what makes a decision like that, right? When is someone such a good founder? Also on this level, that that it's so highly trust built, and can we develop that type of leaders? Can we develop that?
SPEAKER_01:And I think we can really progress in. Yeah, I see the ones that I lean in the most in terms of founders that are building seem to be humble. Not um bit, not that they're not ambitious, but they're relatively humble. They really know how to communicate as well. They ask if they can make introductions. They don't know. There's a certain very precise to a certain extent as well. They follow up when they say they will do something. There's a certain rhythm to that, but also very much checking in, like on a personal level. Are you doing fine? How are you? How can we help you? That kind of question comes from a certain group of founders that has experience elsewhere as well, but are in a they share a lot very interestingly, very open in terms of okay, this doesn't fit with me, or this investor doesn't fit with me, he or she might fit with you. Uh instead of there's a maybe there's an abundance versus scarcity mindset somewhere there, but there is a like an interesting like how do we build this space together? And of course, taking care of yourself. I'm not saying put uh the emergency oxygen first on somebody else and then on you, that's probably not the smartest move. But there's some kind of traits there that I think, okay, if I think about a number of people that I think are going to be very successful and are already, there are traits like that I see, or there are signals or signs. I don't know. And I don't know if you can screen on that, or maybe the three months pushes you through that as well, because you go to a lot of farms, you visit a lot of interesting people that are deep in this space and that share their wisdom and knowledge and hard-heard learned lessons and learned lessons with the cohort. And it's interesting to see if there's a we might have to talk to Hoop about that, if there's a transformation of the people, or they already come in semi-or ready to be transformed or semi-transformed.
SPEAKER_02:Yeah. I think it's great to do a podcast with Hoop specifically on this topic. But uh, I do think it's a co-founder, by the way, just for people that's my co-founder.
SPEAKER_01:He doesn't want to be on the mic so much.
SPEAKER_02:No, and I always say I'm I I sprint basically, but he's still ahead of me in in many ways while I feel I'm running ahead. But especially on these topics, I I do think it this is what we are already doing. So we're really helping, and especially last program, we really facilitated regenerative leadership programs. So, yeah, that there's a lot more to it to get people to really deeply understand the paradigm from which they built, because we do really believe that the intervener has a high impact on the intervention. We also believe that founders have huge impact on the culture of the company that's being built, so that's why we heavily invest in that side as well. And I think you can create learning journeys. And we've had founders who came in scoring very high already, like, for example, Susanna that you write from Harvest Care as an example, is already very much understanding the world in that perspective, but from an entrepreneurial perspective for how to build an organization, there was a lot more to develop and also support from us. But we also have great commercial founders who maybe have more to develop there, right? Or how to counterbalance it. So we also see that we our touch point is a three-month program, and then after, and maybe that's then also add on how the model works. Uh, we invite in, we basically get 10 venture proposals that want to join the studio, and then four of them generally we invite it to our studio, which means we we co-build with them for about a year, a year, one and a half year. So that's where we have touch points where we actively de-risk, which is also about this. We have strong founders, but also just fundraising, customers, excellent operations, etc. So all the basics I would say. But after that, some of these learning journeys are way longer than a year, right? And so, how can we facilitate that continuously as well? Is something we're we're exploring, and I think as a scene, right, we have to look at that.
SPEAKER_01:And so that touches on a point we wanted to discuss as well. How does that reflect or work with investors that are one of the enabling factors is of course our resources and money in the space? And so how do we bring investors through that through a similar journey to be ready uh to engage or intervene systemically and strategically and humble and trust and all of that?
SPEAKER_02:Yeah, yeah, I'm very curious about your opinion on this as well. No, I think if if I just look at the past four years and also when we came in, we've done obviously we've done a lot of fundraising and we've raised from investors from found, family offices, from government, like all types of money.
SPEAKER_01:Because just to be clear, you're funded, the programs are mostly funded through grants, and there's a bit of investment money as well. Like, what's sorry, what's the structure of fresh ventures as we speak now? You're always moving and developing, and we'll get to more the investor side that you would love to enable more as well. But currently, how is the program funded?
SPEAKER_02:Yeah, so the program is funded through mostly through grants indeed. So we have program funding and what we call let's say action research funding or certain labs, which is basically around the question of what to build. So we started to recognize that there's just a lot of, let's say, traditionally speaking, non-profit work, which is finding talent, training talent, very early stage venture sparks, creation, what to build, all of that research that needs to be done. So all of that is in a way non-profit work that which we want to fund eventually out of our own commercial results due to venture returns. So we do take a stake in the the ventures that we co-build, and then out of these profits over time will flow back into the program funding.
SPEAKER_01:That's the that's a model, and right now we're adding a funding vehicle to also be able to deploy so you don't when like when a venture is in the studio needs to raise, you don't have to go out, only go out and look for specific money for one, but you have a vehicle that basically can back anyone that you have in the studio.
SPEAKER_02:Yeah, yeah, and I think that will fill a gap also that that we see in the funding space. So I think it's very hard to get money to this early stage. And if I say early stage, it's probably different than what most people think is early stage. In a way, for us, early stage, it's like we in a way invest already pre-incorporation, right? So it's really talent investment already, and then from incorporation towards a point where actually first money comes in. So but traditional early stage investment is at the end of our this is where we hand over basically. And if you look at that, plus a little bit even in that early stage where we normally would hand over, there's just a lack of resources there, I think, and there's a lot of challenges in early stage funding.
SPEAKER_01:This is really like pre-seed almost before the company exists, basically, like legally exists, of course. The idea and that and there are very few people that can do that, and very few that have the knowledge about those founders that you have because you've worked with them, and there's a reason you invited them in the studio, yeah, because you think it's gonna be an interesting venture potentially.
SPEAKER_02:Yeah, yeah. So that's also I think what we've seen more and more is that traditionally when you say well, already a venture studio is new, right? So thinking about if there is a if there is a thing we would like to be there in the world, we can actually try and just make sure that it gets built.
SPEAKER_01:Which is interesting because you get pushback on that, right? We talked about the first time and second time as well, like this whole notion of you can structurally in a structured way build a lot of ventures. Yeah, like some entrepreneurs we saw that recently as well. It's difficult to grasp, but even though it's super successful in other sectors, and the risk is way lower, the failure rate is way lower, it's a more efficient way of deploying. Money, but it goes against the sort of the notion or narrative we have of the solo founder in a garage somewhere that then come out and change the world or build Google or whatever. And the reality is much more messy, and founders and entrepreneurial people love to have, or many love to have more support.
SPEAKER_02:For sure. And I also think it's all of this thinking is built on the assumption that we would say to a person, Hey, you would be great to build this now. And this that's absolutely not how it works. So I think actually we are building more resilient teams due to the fact that we put so much effort in, let's say, purpose alignment or like problem founder fit. And because this is such a deep fit on a problem mission level, the chances you can pivot they're super resilient and it's really life work level, right? And you can pivot through all kinds even like career switches, but they probably will not shift from trying to solve that problem.
SPEAKER_01:And so coming back to your point, sorry, because then I went on a rant on the funding, because you said it's already difficult, or it's difficult, like a venture studio is new, but many venture studios have a funding vehicle next to it that basically picks the cherries on the cake and has early access. And so it makes a lot of sense that funders would outsource that decision to a fund or to a vehicle, whatever it will be, to you in this case, because you have been so close to these founders for months, you screened them, you selected them, and so then it's like almost weird that you then present them to for a demo day or investor day, and okay, now you need to choose. No, you already made that choice, and if you trust the especially the ones that granted in the past, if you trust the process, then you should also invest in them, basically, not blindly, but in everything that comes out should be investable or should be well.
SPEAKER_02:I could challenge that a little bit. I don't think everything is per se investable in the sense that it's like equity investment or convertible structures that is sometimes dependent on the type of businesses we build, and that's maybe also why we were I wouldn't say hesitant, but we were awaiting. So we have coordinated all types of capital in this early phase coming in, and not every team immediately needs equity investment. So maybe we've got to be able to do that for them to erase basically. Yeah, we've been hustling so much, but this could be the hustle podcast, yeah. That this is well, I guess that could be a separate podcast there, yeah. Yeah, no, I think that to to get into the problem of the early stage. I think on the founder side, this is clearly where we stand, right? It's very hard to find aligned capital in that very early stage. Not per se that it's not doable, it's just it is doable, and also we've managed so far. It's the time that it takes to get very small amounts, right? So, in the beginning, maybe we just need to set up a simple pilot structure or some investment, getting something with customers and doing it, for example, and maybe that's 30k, right? Or 40k or 50k. Getting these type of amounts, if you are not having it yourself, will take the same amount as 300k, right? Or 350k. Same time, yeah, yeah. So, and and for funders, it's also like these amounts are yeah, impossible basically. It doesn't work, you want to build that relationship. So I think on the early stage, that this is a problem from the founder side, but if you look at the funder side, there's a clear gravitational pool away from the early stage. I've seen it happen also. Funders coming in, yeah. We we see that it's needed to get more early, but then gravitating away because if you just put it into the Excel sheet and you look at what does it cost to put money to work, it doesn't work anymore, right? So you go to bigger funds, bigger tickets, makes more sense, you have more information to make an assessment, the risk is lower, so there's continuously that, then you do have very impact-driven organizations, and luckily we see have seen more money coming into the early stage, which is good. But what is also going around is let's say the VC logic, right? So, especially people new to the space, especially if they're coming from a non-agricultural uh industry, the dynamics are different, and if you have this emphasis of I invest in 10, one of them needs to be a unicorn, which means all of the 10 I invest in need to have that potential, then we get a bias towards unicorn-ish organizations where we can build great companies, I think, which are maybe infrastructure companies, for example, or processing companies, which maybe are not unicorns and need a different timeline, but they will be fine and they can get good revenue, good returns, but it's a different frame to look at it.
SPEAKER_01:Zebra, somebody calls them, right?
SPEAKER_02:Zebra, yeah. So, but the VC logic I think still echoes even in in other contexts. If you're very early, there has to be a huge hockey stick or huge upside because that's the only reason.
SPEAKER_01:A huge hockey stick in preferably in year three, not in year team.
SPEAKER_02:That's the yeah, especially if it's a fund, right? Yeah, we have to get returns in in in six, seven uh years. So, how do we do that? And that is the challenge, right? Also for us.
SPEAKER_01:Because investors are used to that, they speak that language, they think impact in many cases works like that. Like it's a constant challenge to so there's coming back to the piece, there's a lot of investor education needed as well.
SPEAKER_02:Yeah, well, it's two things, right? It's also just I also fully get it. Like, even if you change your mindset, then still, how do you do it? Because it's not like you can magically have more time to do all these small deals showing small things, right? So it's also a really an infrastructure question, and that's why I think where we can come in and potentially do it, because we're now talking generally, I would say, about the early stage. But if we talk about region egg, for example, and well, we can get into the in a way Tecla's argument that shout out Teclatonus. Uh the conversation we had on like the pioneering work is the most costly, right? So maybe also for investors that's true, right? If they are active in the space for a long time, you have the knowledge you can assess quicker, I think. So you can do deals quicker as well.
SPEAKER_01:So there's a time that investors need to spend in the space to get comfortable with things, and I think we've seen a lot of new people in the last few years. So they need to logically also go through a few a bit of a journey and invest a bit and lose a bit and grant a bit and understand and spend time at RFSI and at Grants well and need to get Yeah, it's also knowledge that you need comfortable. Yeah, and to get comfortable and to do some earlier things because you know it's relevant and because you know it's gonna work. Because you have a bit of a framework where it fits in, okay, this is a food transition, this is an act transition, these are brands, okay, these are the issues with brands, these are the opportunities, this is food. That takes a bit of time. Question, of course, and we're talking about that. Can we increase that or reduce that time? Not increasing. Podcast plays a role in that? Yes, but it's also quite overwhelming. Like the answer cannot always be it depends. That's like a tricky one for investors. But there's education needed there, and maybe also other structures to enable that. Because why are super early stage pre-seed funds in tech and software working? Because small amounts make sense if the potential payout is so large. And if you are in that mindset of one in 20 or so, but the average VC fund doesn't have an amazing return. Like it's always we only look at the outliers. The average one is 3x or something, which is something we could even do in regen to a certain extent. So there's an interesting one as well. We only look at the outliers. Okay, did you see my I missed on the WhatsApp in investment, and now I'm sad forever? And of course, only a few people got into that one. And so there's a mindset shift needed, and then also practical tools, like to actually for investing it. We cannot do 10 or 20 or 30 25k deals a year, like we just don't, and then managing them and following up, okay, board meetings and vetoes, and something goes wrong, and we need a bridge round. And we already see with that with Generation Rhee with our investment syndicate, it's a lot of work doing deals, and small deals is the same amount of work, yeah.
SPEAKER_02:And so it's it's tricky, exactly. And I think there's different players at different stages, right? I think also as a positive note, I do think I have seen of course us mature, but everyone around us as well, right? I've seen new investors coming in, I've also seen the changes in the also financiers that have funded us or have invested in our teams. I've seen the change, and I think we're really getting to a lot more mature ecosystem in that sense, and it's getting better, I would say, for early stage, from my perspective, right? But I've seen the journey also, and I think there's a still a challenge, right? So if I look at the journey, I have seen funders go from let's say or impact investing or SDGs, and how do we do this? ESDG, yeah, ESG and really wanting to do better investment, right? Let's do not horrible stuff with our money, and then it often grows in, or we can try to get to the next level, which is all right, in the food system, it's what it gets more complex, somewhat more complex, right? So you see ah, we systems thinking comes in. We've seen it come in, and now we talk about systemic. Two and a half years. Maybe, yeah.
SPEAKER_01:That's transcap, of course, agri-food systems change that we've advised, and of course, shout out to Ivana, to to Evo, to Una, etc. They've done a lot of work on mapping systems, which I think is a good start. Super complex because where do you stop? Where do you but at least then you have a sort of okay, what system are we talking about? At least you have a shared, you can print it, you can put it on the table. I've seen that with investors. Yeah, they get very confused and very into it, and they lean in, they okay, where are positive feedback loops and negative ones? Where are we blocked? Almost everywhere, where are opportunities? Like it's it at least you have a sort of just if you have a battlefield, or that's maybe not the best analogy, but you can at least say, Okay, where are we moving and where are we not, and what is and with funders and investors, okay, like you can start at least saying, Okay, this is maybe not so relevant. Yeah, you can still have a debate of what is the most relevant in intervention point, and everybody has their darlings, but what is less relevant or less less yeah, needed or urgent now, yeah, which is interesting.
SPEAKER_02:Yeah, indeed. So I think that's also a process in a way that we went through, right? We did system mapping four years ago as well, and also me personally getting into let's say systems thinking, I don't know, 10 years ago or something like that. But it can be in the beginning, it's quite overwhelming. You're like, oh yeah, this is it, and you get into this high complexity thinking in a way. It's it's it's really this this you start low, you don't know anything, then it you go high, and then you end with the same simplicity again, right? But if you bring it back, but that is a process where you go through, hey, actually, it's there's dynamics and we have to look at it, and there's a systems approach, and it's a whole industry, and we have to look at it more holistically. What comes out of that is indeed often like a map, or okay, this changes the investment thesis, maybe, right? This is we're gonna look at it differently and we're gonna align it to an understanding of how the system dynamic works, and then, right? So, and then what do you need to do? So, all right, how are we gonna internalize? Yeah, yeah, and then you see projects or a venture are is coming by as an investment case. Is this systemic? Is this systemic? And we had that question in the beginning as well. Is this systemic? If you look at a project and it can also be uh suffocating in a way, almost, right? If it's like, is it is this well systemic enough?
SPEAKER_01:You have to think about is this systemic enough and is it gonna change the world tomorrow? Which of course it doesn't, like it can also paralyze and then you don't do anything, and that's the last thing we want. We need way more action.
SPEAKER_02:That's tricky, and also I think, well, we can talk about it in many different ways. I I do think you have to look at does it create a new problem elsewhere? Does it even create a bigger problem? Does it create lock-ins for something we actually don't want to exist, right? And is that problematic or can we solve that detaineously? There's many ways that you can look at anything.
SPEAKER_01:You can get Horizon 1, 2, 3, 1, 2, 2 plus, 2 minus. You can look at Donella Meadows, we used a lot, you can look at many, but it's I think it's really good if investors do that and funders. For sure. Look at negative consequences, is it a net positive potentially? And don't burden the company too much with that because it's gonna be a lot. But to have that at least that thinking before, before you step into oh, this would be an amazing, I don't know, pesticide replacement. Or okay, great, but if it only works on feed for animals, are you locking in a system that we probably want to change fundamentally anyway? This is a very simple example, but just to think through those instead of getting super hyped and excited by a solution that is gonna change everything. Yeah, the holy grail and the holy grails, which we see a lot. Like investors are super skeptical until they fall in love with a solution, and from that moment on that's the only solution. Yeah, yeah. But yesterday you were solved everything. You were very skeptical yesterday about, and maybe it's a suite of solutions, like to get pesticides out of the chemicals out of the food system, we need a whole SWAT team. Yeah, and so that's but that thinking I think is really good, as long as it doesn't suffocate and paralyze and don't make you move.
SPEAKER_02:Yeah, I think it's critical to have that mentality. So do the system mapping also as a means to get understanding of the dynamics, and I do think is very valuable if the entrepreneurs that drive these businesses also have this perspective, right?
SPEAKER_01:And have the answers and have thought about it.
SPEAKER_02:Have thought about it, and maybe can put it on a timeline as well. We're gonna first do this, and then that is very helpful.
SPEAKER_01:But I I think that's probably one of the other traits I see. Sorry to interrupt, is that entrepreneurs that they have an ambition, they have a plan. Like, probably if I would ask them the one billion dollar question, they have answers to that. We use it for this and this. This moment we get traditional financing in case of fund structures. This is the moment we get 10,000 farmers, or if you're in India, 100,000. This is the moment we get normal consumers, this is the moment where the premium is no longer needed. Like they have not that it has to be exact those timelines, but they have a 10-year plan or a 10-year vision. Okay, what are the crucial pieces that need to happen to really drive systemic change? Yeah, and the really good ones have thought about it and know what they're doing now, yeah, fits in that or not, otherwise they wouldn't be doing it.
SPEAKER_02:Yeah, yeah, yeah. So famously, the the quality team be because we use the theory of change and we talk about that, and we can also make things complex, right? Because we like systems thinking, created the scribble of change, very simplified. It's in their office also, but still it's it is thinking about what are these steps that we are taking, what is the first fully hardcore focused, then what's the next one? That's the next one.
SPEAKER_01:Quali for background is virtual fencing or virtual shepherds, I think is a better term. Um, we had them like herd management in dairy, how to get animals back outside, basically, starting with dairy. Why there are a lot of really good reasons. We did a very long interview, a great interview, actually in person as well, in a studio, which was super fancy. And now they're we invested in them twice through Generation Re, and we might do that again actually soon. And they're making great progress, which is not easy with hardware on animals that kick things and hit everything. And if you think hardware is difficult difficult, try to put that on animals. But the potential, yeah, is enormous. We've seen that, and so Collie is an interesting example, but also there, like the goal is very clear. Yeah, but it still means you need to do 200 of these devices now, and then what do they actually do? And getting there step by step is but that capacity is yeah, is a it's not a given.
SPEAKER_02:No, yeah, and so if you look at then this growth path or this change path going from let's say the SDG investing, impact investing are more systemic. Can I find the systemic solution? Going to actually, it's not about one single fully systemic project, it's what are the portfolios or what are like pockets of change that I can influence and can we start funding a portfolio? And then obviously, we're making the argument like maybe some of that portfolio exists, some of it doesn't exist, or too early or not matured enough. Can we proactively accelerate and build those those projects? Have them come into existence basically, have them come into existence, and I think that is I think we're at that point, right? I think a lot, I think this is not new stuff I'm saying now, like quite a lot, especially in your as a target audience, like impact investors are already at we need portfolio level investment. I think what we've also seen and learned is is basically the enabling conditions to to drive a certain system outcome that are needed. We do find that it had that also gets financed to organizations that build these enabling conditions, which I think is good. Should we should continue doing that? But in a way, I think ventures but also farmers in the space are often very close to that the actual issue, right? So they're trying to bring about a certain change in the system in the case of farm or actual the actual natural sit natural ecosystems, and to be able to do that, there's so many challenges in the existing system that needs to change, right? So many enabling conditions, it can be the local rulings, right? It can be training your personnel to think differently, it can be training all kinds of financiers and all kinds of stakeholders throughout the whole value chain. All of that work, yes, there are organizations that get paid for that work, but the pioneers themselves often aren't, right? They are funded for the project, which is very targeted on what are you actually doing, right? Okay, you're doing virtual herd management, we pay for the colors, not for the lobbying that's needed for because it might be illegal for whatever reason, whatever, right? Or with our uh the harvest care and like it anyone who will get active in the space between our food system and our health system. There's so much enabling conditions that that we still need to influence there. I think we also need to get it close to the let's say the farmers, but also the ventures that really drive these enabling conditions and help them and facilitate them in in bringing.
SPEAKER_01:What do you mean by that? What would be an ideal solution?
SPEAKER_02:What we've been talking, let's if we bring it to the farmer, for example, that was a conversation that's going on right now, right? In in terms of potentially you don't need the transition finance, the knowledge is there, which is great, right? So enabling condition is also bringing about that knowledge. I think this is the pioneering costs. So all these farmers that just tried it and often didn't get compensated for that, right? So do we have a way to have pioneering costs? But then how do we get that knowledge from farmers to other farmers and spread through the region? I think there's organizations that are facilitating that and already doing that in a great way, but also pay for the time, then, right?
SPEAKER_01:So the farmer goes into transition and doesn't have any place to look at, there's no examples in his or her region or in the way that they are approaching the transition. We see that with many. It takes five to seven years before you figured out in many arable conditions what actually works. But once you've done that, it's very applicable in a year or two by all your neighbors in theory. That's but we don't compensate for those seven years of or whatever the number is. I'm not saying it should be, but for the both could be should be there any be should there be any just innovation budget or RD, like if you lose X type of revenue of your of your farming company, do you get compensated? Is there some kind of insurance just to make sure, okay, you can eat? Yeah. Like you're not gonna be, but maybe you can go on all day three times, but no, there's a certain safety net for farmers that want to dive head first and really try everything because they're doing it. And they're doing it for all of us. Like it's not that uh they're doing RD, which should happen on universities, it should happen in agrochemical companies, God forbid, but it's not, clearly. And it's not happening in a commercial way at all. Yeah, and so I've been playing with that. Is there's just a budget for farmers just to fill up the gap if they really hit a wall in year two, just to make sure that they can lose the farm.
SPEAKER_02:Yeah, and I think this topic gets quite a lot of attention in a way, right? Transition finance or how to get that. Maybe someone arguing too much attention because in some regions it's less needed. But then even if you go through like the pioneers, for example, let's say Yannick.
SPEAKER_01:Right.
SPEAKER_02:So we uh well it we had a what to build webinar.
SPEAKER_01:We were talking to uh Mateo and Yannick and uh Mateo Mazzola, Yannick uh Svonskonov, Alfonso, yeah, just do names with the names. Yeah, right. I put them in the show notes of the conversation we have.
SPEAKER_02:To make it very practical, what she was also saying, and that I think is the level of practicality you can look at it, is Yeah, we have learned stuff, right? Or if you're you have learned stuff and you can tell it to people, but there's a lot of people asking questions. So practically managing your time and how to get your time covered for, and that's the same for ventures, right? You have to focus on your business.
SPEAKER_01:And you do so much education and research.
SPEAKER_02:And then all that education, all that, how who is doing that? And how is that tied close enough to the actual farmer? Maybe it's actually buying time from them, but in a way, you also don't want them to spend the time on it or small amounts, right? So how do you do that? And of course, organizations are working on it in terms of setting up educational programs like Climate Farmers is doing, and and many other organizations are working on that regeneration academy as well. But I do think we have to look at what are these enabling conditions and how can we support, let's say, the single projects, ventures, farmers, whatever, to build that and recognize also that they are often building that, which just creates more effort and stress. And to be honest, the founders themselves, the farmers, we, for example, as well, sometimes well, actually, we that we ourselves don't recognize that is a thing you need to do. So you run into it and you start doing it, but you often don't put it into an investment case or a grant agreement.
SPEAKER_01:So to be a lot of it's a lot of time spent by yeah, on education of whoever on corporates, on some corporates come to the farm before they actually buy more or with the right premium, it takes three years. Real case, I'm not gonna name anybody, and I think ten visits with different teams and different, and it's all time lost by the farmer, not compensated. And okay, now he or she gets a really good premium, but it took a lot. That's not the job of the farmer to do that, to teach different teams of this massive organization about what regeneration is. These are tours that need to be paid for, or the premium should already be there. And the same with fund with farm with funders and ventures, like the amount of time they educate funders and investors about what regeneration is and what it isn't, and how it works, and how it doesn't, and what are the opportunities, and they end up not investing. Yeah, okay, they're called investor meetings, but they're basically education sessions. Yeah, and that's okay to a certain extent. And they're like an uh a fund manager or an uh GP saying, I've I've had 300 meetings with different LPs, and that you just have to factor in. I think a lot of them were education meetings and not near uh an actual investment at the end, which might turn into investments two years down the line, and we need to have a long view, blah blah blah blah. But it does feel like uh uh quite an inefficient process.
SPEAKER_03:Yeah.
SPEAKER_01:That we put it on the most fragile pieces of the early founders and farmers.
SPEAKER_02:Exactly. Yeah, yeah, yeah. And they spend most of their time. It's part of the game, right? It's part of the game, yes. Of course, we're not complaining. That's part of the game for sure. But I do think as a studio also, I think we can play a role in in helping bring about do some of that work, actually, right? So do some of this enabling condition building, but really close to, in our case, ventures, right? That's our role. Really close to what are that what are actual needs, what are we running into, and can we offload or bundle, right? Because we have three ventures, for example, in decentralized processing, different things, right? But it's all decentralized processing. Can we figure out some of the puzzles in a more central way so that founders get answers and have shared learning curves basically, powered by also an organization like ourselves and the ecosystem that we have around us? So, through that, we don't have all these individual projects learning individually and building these enabling conditions together, but we accelerate it because we identify it as a key need right now, and that's also a challenge, right? Now, for example, through subsidies or grants on maybe things like transition finance, or actually the funding is about the potential problem or the potential thing, and it can sometimes be hypothetical. It's not fully hypothetical, it's relevant, right? But it's not always directly led by a specific problem from a farmer or a specific problem from a venture, and driven by that hey guys, we have these five problems now. Let's just solve these. This is what the pro the project is about, right? So that's uh that's the I think part of the systemic finance challenge, or how you want to call it funding the space or getting that space done is do we have enough resources to also build the enabling conditions and not have ventures and farmers burn out basically before they get to the other side of the valley, yeah. Yeah, they get to the other side of the valley because later on often they are paid for that kind of work, right? And they are recognized.
SPEAKER_01:Yeah, but it it is a shift. I was talking to a farmer, I think back in May, that finally started charging for his time. He was asked to speak everywhere and share his journey and blah blah blah. And until then, and then he realized, yeah, but I'm taking away my time of the team, farming team on the ground, that enables me to actually go there. Yeah, and we had a conversation with top 50 farmers as well that really pushes their farmers as well. Like, charge for that. Like you have you've spent years with no budget doing research. You are succeeding. Many of them are very successful in all the different forms of success. And if you go and speak somewhere, dear God, charge for that. Depending on the audience. If it's a student group, it's different than if you're invited by a massive multinational. We're looking at the ex-office of Unilever. But there are speaker fees for that. Please do. And then to still decide if you want to do it, etc. But there's a value there in your experience, and do charge. And if they don't complain, you probably didn't charge enough.
SPEAKER_02:For sure. So I think that's a simple way. I'm personally also quite passionate about the yeah, let's say farmer-led innovation or because so many of these pioneering farmers have a whole list of things that need to be built yesterday, preferably, which are for sure 30%, 50%, whatever could be a very interesting venture.
SPEAKER_03:Yeah.
SPEAKER_01:They're not gonna do it, they don't have the time, and maybe they shouldn't, they don't want to. There's a different attitude, of course, being an entrepreneur or a farmer and an entrepreneur on a farm. How do we do more of that? Farmer-led, like real stuff, not like act tech stuff that then never finds a customer because they forgot to ask a farmer.
SPEAKER_02:Yeah, no, build it from the farmer. Well, actually, I think we so I've spent m much time on this, been talking about this quite a lot with a lot of people because I'm quite passionate about it and we're getting into this space more. I think there's two things, right? One is let from the business case of the farmer, so adding, let's say, stacking business models onto the farm. Also at groundswell, we we I've been talking to a few farmers that were really opening up also books, right? And then actually, we added in this business model, we started with whatever sort of enterprise, basically on-farm enterprise, and yeah, it's super exciting and it works really well. Would love to add XYZ as well. Often, those are not like big innovations, it's like we want to add a chicken coop and chicken business to the farm, right? But we don't have time. And then I'm also curious about that. This is more, let's say, farm stacking. Can we find mechanisms or ways to make it easier to say, hey, maybe you can find someone actually in the region that is very excited to build that business model with you, on which happens, right? So this is more, let's say, on-farm venture creation, which is not in that sense systemic, but really helpful in terms of getting more business models to operate on a farm. And we've seen this happen, but I'm curious how we can help do this more. But the second thing is indeed more Just on that one, and then we get to the second.
SPEAKER_01:We have had a conversation with Fred Hansen, who sees that as well, and then works specifically on okay, what are the contracts and underlying conditions? How do you write a holistic plan together, a management plan? What happens if it goes not wrong? But what happens if you that person wants to leave after two years? How do you compensate for the soil carbon he or she built, or for the trees that went into the ground? It doesn't have to be a marriage forever. But I think we can all agree, or most people say, I would love to have more uh entrepreneurial activity on my farm. Yeah, how do I get a chicken business, a disc business, etc.? How do I enable that without finding someone that takes over the whole farm and becomes which often doesn't work? So, how do you enable more of that? Probably through yeah, some ventures that do that on multiple farms. How do you stack it? How do you move it? How do you regulate that? There are a lot of questions around it, but it's very important from the beginning to to structure that really well and get really honest and open about okay.
SPEAKER_02:I think that is the unsexy part, but it that is the part that can be very helpful if it's like clear deal making. I think it's steward ownership or at least the principles of or let's talk about money and let's talk about power and let's see how we can see strategy and power dynamics and then facilitate these conversations and in a good way. I I think that could be.
SPEAKER_01:I mean, tourism the same and hospitality. Many people say, I would love to have a restaurant in here, but I'm not gonna be the chef, obviously, because I have six thousand things to do. Like, how do you enable that without becoming a shoots drama in five years? Which often like this, I mean, there are egos in the state.
SPEAKER_02:I mean, we it's 15 business models, right? Or maybe 10 business models. It's not like it's every time, what should we do, right? It's uh dependent on the context, but we can replicate even. Like here, they did it like this: some infrastructure, there there's stuff to be replicated, and then but and that is the challenge, obviously. Who do you bring to the farm? Can you bring energy to the farm? Who is willing to go there? Ideally, they're from the region as well, right? It's just it's not coming very foreign in that sense. It's like someone from the region, and how do you facilitate that? So I think that that can that is already happening, right? Let's be clear. This is already happening, but it's a venture in that.
SPEAKER_01:Like somebody that says, Okay, how do we enable say chickens, which is the most the easiest, let's say the one that just appears on 30, 40, 50 farms? Like, how do we do that? How do we market it then? How do we enable?
SPEAKER_02:How do we make this a blue blueprint, a blueprint replicable?
SPEAKER_01:We know the regulation, we know slaughter thing, we know, and we find local, a semi-french size, semi this or semi just to step in, and it's a really could be a really good business. Could be trees, could be I'm not saying that should be that tourism, but how do you yeah bring more entrepreneurial activity on farm and not overload the farmer with more? No, exactly.
SPEAKER_02:We have models, and some people are still working on it from the program, for example, on hospitality, which I think is very interesting. And uh we're seeing that more. And then the second, if I the I think the second part is if it in indeed is a different type of innovation or really a new company, right? And that could be, for example, we're now in a conversation with someone who basically wanted to do have a tractor that was electrified, electric tractor, yeah. Electric, but also with combining it not being very heavy, which is difficult because the battery and stuff, right? So actually found a way, worked for him, uh nice solution, elegant, and then it's like ah, maybe industry wants to invest in this, but yeah, industry doesn't yet want to invest in this. It's too early. Ah, okay, no, too bad.
SPEAKER_01:And so he or she that's that's that's a farmer that basically did it for himself. Yeah, like so many farmers have been built things, sprayers, cedars, whatever. We've seen that so many times, and then it stays there. Maybe they build a skew for friends.
SPEAKER_02:Yeah, yeah. With Mateo, they he has this what sort of beer fork. It's a fork, and maybe that's another right term, but it's called uh the fork. So it's a a tool, but it's going pretty well, right? Somebody's actually producing it and selling it.
SPEAKER_01:It's a simple tool.
SPEAKER_02:Yeah, it's a business for someone. But and there's a lot uh in between these types of solutions, right? Sometimes they're more complex. You have people like somebody setting up a soy brand and all kinds of uh enterprises.
SPEAKER_01:Especially in their heads, there are 10 other businesses that could be built. Yeah. Or service businesses or compost T. There's such uh in there are such innovation machines, applied innovation, yeah, but they're limited by time and space and just time, literally, and they also need to sleep sometimes.
SPEAKER_02:Yeah, and then I walk around in the let's say the technology transfer offices, or basically the our European problem. This is a European problem. We're way behind on we have amazing institutes creating all kinds of knowledge and IP, right? In this case, it's IP, but we're not valorizing it, it's not turning into business enough. So we're already looking at how is this process working in Europe, going from knowledge and people developing stuff, IDs, the concepts, IP, whatever, and turning it into business. But this is fully geared towards uh basically academia or universities collaborating with industry, right? So it's industry funding academia or working.
SPEAKER_01:Industry saying we have a problem, please tell your industry problems. But they pay for it. That's an interesting problem.
SPEAKER_02:They do pay for it, yeah, yeah, of course. And but if we look at this, so then the source of knowledge, let's say, or there's an invested source of knowledge is true in universities, then we have well-developed systems, basically technology transfer offices. I feel they're made for the bet they best work in medicine development, I think, in how we structure them. It's long RD times and then patents, very tightly protected patents with basically having a monopoly for the open source electric tractors, maybe exactly. So it's it's a really different innovation cycle in a way. But can we look at how technology transfer in that sense but do it very simply, right? So we have farmers, we recognize farmers now as the actual innovators, but how do we build a structure for them? Because how involved do you want to be, right? It's also not just time, it's also willingness. Like I don't want to be, I want to be a farmer, right? I want to farmers. And they want to build electric tractors for a living. I don't want to do fundraising calls and I don't want to do go to these fairs to sell a tractor. I want to do farming and I needed this thing and I'm passionate about this thing. Maybe I want to I do want to be involved, right? I want to be chief in innovation, for example, right? So, how do we build an infrastructure that aligns with on the legal side, let's say, or makes it very simple to build trust, not just on a human level, which I think is also very important. It has to be human. We're just people, right? There needs to be trust, but also on the legal, what happens? How much power do you have over the thing? How much influence? How active is everyone involved? How does the money flow if there's success? How does it work?
SPEAKER_01:How do you make sure it don't sell to John Deere? If that's not applicable, maybe it isn't.
SPEAKER_02:Maybe you do want that, maybe you don't want that. I think some of these things you can or New Holland, not to just pick on John Deere, but they're all the same. Some others, yeah, it's a nice name. Anyway, we can structure that differently, and then I think it can be uh can be accelerated.
SPEAKER_01:It can be super accelerated, and we can talk hours, which we often do, as you might notice. And but to be conscious of our time as well, let's talk about the fund structure you're building next to or above or inside or around, whatever is the right terminology for. We touched upon it a few times. Like, how do we you give funders and investors and the venture studio easier access to earlier money without having to go around for 20k, 50k, 30k, 100k, whatever the amount is, and just very we've talked about why it's very difficult. So, what's a potential solution there?
SPEAKER_02:Yeah, well, obviously, I think we are the solution, obviously. No way. Please help us with your holy grail. No, a solution. I I think the the issue is if you have a big fund and you have a minimal organization that you need to get the capital to work, right? So if you take a percentage of the fund size for the management fee, you can cover the minimum organization. If you have a small fund, because it's early stage, you need small tickets. Actually, a big fund you cannot get to work with small amounts. The minimum organization you need is bigger than the percentage of fund management, right? So that's what let's say the early stage gap, which exists. That's that's why you need 20 million plus a fund to make it work.
SPEAKER_01:Just because you charge just for people uh look into the details, but it's 2% management fee or two and a half, and that's the minimum amount you need, and then you can do the math. It makes more sense to have a 50 or 100 million fund, which is gonna do bigger tickets because yeah, how are you gonna cut 100 million into 25k tickets, and thus you see very few small funds? Yeah.
SPEAKER_02:As soon as you start doing this in an Excel sheet, you're like, ah, okay, I get the problem.
SPEAKER_01:So if for anyone is saying you should be you should do a fund, etc. Okay, do the math.
SPEAKER_02:Yeah, do the Excel sheet and you change the assumptions and they're like, ah, maybe this a little bit higher and this ticket size, but if that would be a little bit higher, then ah, then actually it starts looking good. So that there's an early stage gap, and then there's this, let's say, systemic or regenerative food system gap in terms of it's a little bit it can be a little bit more complex. So you need a little bit more time, maybe.
SPEAKER_01:So how to put it time for D D, you mean or time to do it?
SPEAKER_02:Yeah, to find the deals, to look at the deals to deploy.
SPEAKER_01:Or you say there's not enough deal flow? Well, what do you mean you need a bit more time? You need a bit more time to deploy.
SPEAKER_02:A bit more time to deploy, to assess it, to find it. Also just assess it, right? If it's more complex.
SPEAKER_01:Not everything is more complex, but yeah, but not necessarily, I don't want to make that a scary argument. In that sense, I think if you have the money bundled and you have the systemic view, etc., you can still move pretty fast.
SPEAKER_02:You for sure, but especially in the early stage, right? If we talk about burden shifting, or yeah, you can also just look at the money. Yeah. I don't want to look into that. Yeah, that's true. Okay, okay. So you need a bit more. Like I think aggro health is a perfect example. There's people that are specializing in aggro, and there's people investing in the health system. There's not a lot investing in the Nexus. As soon as something comes in.
SPEAKER_01:Shout out to Naeem, Anthony, yeah, that's great that they're Stephanie and actually putting that word central on.
SPEAKER_02:Agri Health, yeah. Agri Health, great. As soon as someone is in the agri-food and then someone is talking about all kinds of health metrics, and like we don't know, we don't understand this stuff, right? We we shy away. So it's siloed. Anyway, it's not a big thing, but it I do think you basically need a little bit bigger organization to get this uh money to work. And how I think we can leverage the studio is that basically the work we do is already what let's say fund management does. So we do deal flow creation ourselves, we get a lot of network effects due to it because we have our ventures so close, we get others coming to us. So deal flow is happening. We do very close due diligence as we know the people very deeply, we work with them closely. Obviously, we need to build in also subjectivity, right? But there's methods to do that. But we have everything in place to do good due diligence in the early stage. We do capital orchestration already. This is basically has been our bread and butter so far, so that is something we can do, and then portfolio management we're bringing in. You need to have more seasoned portfolio management expertise. But what we have is a really strong community, so different than other portfolios, I would say our ventures are very tightly knit, so they work together, and that is helpful because you can bring them together and there's added value there.
SPEAKER_01:The share offices in Amsterdam and put here in Rotterdam, they're very close to each other. Exactly. And people from other cohorts join earlier ones, and there's the talent.
SPEAKER_02:Join the team, exactly. Yeah, so that's the second layer is a studio, is the whole idea of a studio is that you do it, become more efficient and actively de-risk, right? So because you do this continuously, you develop more and more shared knowledge, infrastructure, right? Shared templates, resources, just practical stuff, technical infrastructure, all of it. So shared resources should be able to increase the efficiency. We pro you proactively de-risk. So the goal is to really have a lower failure rate, and you can do this precision finance in the early stage. You can say we just not we don't have to look at the these first few small tickets, so the founder can focus on the thing. We know this is a thing. Here is 20k, buy the machine, buy the thing, buy the whatever, get the customers, and then we can get to the founders.
SPEAKER_01:And save so much time from founders, yeah.
SPEAKER_02:And we can recycle IDs and talent, and in a way, also money by doing this stage gate funding, right? We don't have to do the 100k immediately, we can do 20k and then 50k.
SPEAKER_01:And by shifting that to, let's say, the studio, which is still partly grant funded, and at some point will be out of returns. Can you make the economics, at least on Excel, work for the fund?
SPEAKER_02:Yeah, part of it. So to be able to do this, so uh So to be clear, uh to finish your point on the recycling, we the recycling IDs, I think, is also relevant and talent. So if you have a good team that was basically too early, you can still build something else. If you have a good ID but it didn't work, maybe in two years the time is actually right and you've done all the research already, right? So there's knowledge buildup in an entity, it doesn't get lost every time. One thing is how does this work? Normally all of this is on the cost side, right? It's a 2%, it's a cost. We take a sweat equity type of position, right? So some of this super high risk is not purely cost, it's also an investment already. So still, cash flow-wise, you have the cost, right? But it's turned into an investment. And then we have platform funding because we do attract nonprofit money, and also legitimately so, I think, for training people, building the ecosystem, doing the research, early stage of venture creation, and basically by having the impact outcomes that nonprofits want aligned with very early stage funding, which is basically not happening or very difficult, you can fund one organization that can drive all these outcomes at the same time, both the financial funding side and the impact side. So we cover part of that organization through that. But it's the same part of it is the same people or the same structure and infrastructure, and because of that, it can actually work and we can proactively build these ventures, we can build these portfolios and clusters that we need and proactively do so and co-build these enabling conditions. And through that, I think the system is.
SPEAKER_01:Because you won't be doubling down on all of the ones in the studio. Maybe not. No, maybe not. We Which is also a signal if you don't. Yeah, which is also a signal indeed. But fair enough. There's no you don't this is yeah, um, this is also uh yeah, how to allocate scarce resources.
SPEAKER_02:So and we have to be realistic, right? And sometimes we will always work with our teams to get to the point where it does make sense to get the money, right? So but anyway, you get a total investment of let's say 500, 600k into these teams that you can deploy, and then we have some money currently reserved for maybe let's say the winners to put in some more and join around because basically most of our founders want us to benefit more, right? So we can get into the interesting rounds as well to make the fund.
SPEAKER_01:Yeah, yeah. And so then how important if you model returns, how important are is it doubling down later on and joining versus being very early in?
SPEAKER_02:Well, obviously, it's I think it's always easier to step in a little later because the risk is often way lower, right? And you it that's still quite early, right? You can still get in with good deals. And stepping in early, I think, is very relevant, but it's also relatively small amounts, right? So even a small piece of the ball.
SPEAKER_01:The X is a lot, but the actual money amount is not.
SPEAKER_02:Yeah, no, exactly. But that's the big chunk is early stage. Yeah, all right. And we can we are modeling in the Excel, although there's a gravitational pool to change it. If we keep it like this, we do think we can make it work and we can we will build more than 25 new ventures, right? We will fund, we accept to expect to fund more than 35 businesses over the course of of these seven years, and train a lot of new founders and new people, right? So 150 found 150 founders for sure, probably over 500-600 people in the talent pool.
SPEAKER_01:So, yeah, I think that's a multiplier, the talent in the space.
SPEAKER_02:Especially for also for our teams, right? We see it already. We see people that came through our program now working for our teams. We put a lot of effort in selecting really good people, and then they have really strong bonds trained, like we said earlier, right? On both being very entrepreneurial, being yeah, it's a batch as well.
SPEAKER_01:I saw it at events, people like, yeah, I went through fresh and at this and fresh without, and it's very interesting as a batch of okay, you've been through that program, and it's people know it's not it's not everybody knows about it, but it's an interesting recognition. Okay, you've put in the work, and if you're building a venture now, you join something that's not saying irrelevant, but you've been through that, which is quite a yeah, yeah.
SPEAKER_02:I think that's that's a nice butt. We didn't fully expect that we didn't expect the alumni is relevant. And I think we're to circle back to the beginning, we talked about this regenerative foundership. I think that's also an invitation to all of us, basically, right? If we look at what are the type of entrepreneurs that we do want to back, what are the type of organizations that we do want to invest in, what are the traits. I think organizations like ourselves can really proactively design for it, right? So we can do education in a way, but also actively build what is needed. And I think through such a vehicle is not just deploying the capital, but it's really creating the right type of organizations, the right type of founders, the enabling conditions to make it work, and also, and this is what we got from some funders as well is for example, that don't do fund-to-fund. They're like, we want to invest directly, they do recognize yeah, we cannot get involved here, right? So we don't want to do fund to fun, but this is yeah, this is a space where we cannot engage and we do need to invest early because we do see that we are in an early stage, right? The regenerative food system or the regenetic, or it's still early.
SPEAKER_01:We're still very early, yeah.
SPEAKER_02:So we need more we need more in the in the pipeline, yeah, and we can help build that. So on the one hand, just knowing who do we like to see, what is the profile of a good founder, always curious about that, but also what should be built or what would you like to see more in the pipeline we can actively build. And yeah, we need to find, I think we can be an organization that really drives that pipeline, not just adding projects, but really adding everything that's needed for the wider ecosystem to mature to be able to have this early stage actually turn into later stage.
SPEAKER_01:Yeah, God forbid later stage. Imagine if we can put actual impact if we yeah, actual impact and size and scale, and with all the challenges that come with that. I wanna thank you so much. I think it's a good moment to wrap up. I'm very curious the fourth cohort coming. Definitely, if this is before you close, if you listen to this before and you know someone, or you are a person, check out or an entrepreneurial person and interested in diving deep, check out Fresh Ventures, and share it with people that you're like, oof, they should really they have talent, they want, they are, they keep talking about this food thing and ag thing at dinner parties, and it's time they build something. This is one of the ways of of leaning in. And yeah, thank you so much for coming on here again, third time, as a charm, in person. Thank you. And to share about the journey and dive a bit deeper into what funder or what funders we need, actually, investors, and what founders we need. There's an FF that there works, and what farmers we need. I think there's a nice there's there's a triple F that we need to, which is not a good bond rating, I think. Maybe it is. But what are the conditions, enabling conditions for those to thrive? And yeah, how do we get more, as you always like to say, I think from the beginning, more people running in the space and walking.
SPEAKER_02:There's a sprint at a marathon and constant tension, and stillness and all that.
SPEAKER_01:And stillness and sitting still and looking at the water, which I've done for the last hour plus. Lots of boats has have passed. Yeah. And so thank you so much.
SPEAKER_02:Yeah, thank you. Look forward to the fourth.
SPEAKER_00:Thank you again for listening all the way to the end.
SPEAKER_01:And I'm really interested what you think of this question. How do we get more entrepreneurial people into this space? We see many people being touched by the health side of things, the inequality side of things in food, uh the climate angle, obviously, biodiversity, water, all of those. Um, countryside, depopulation, etc., etc., rural development. But how do we get more entrepreneurial people to see this as an opportunity, as a space where you can build things? Nonprofit movements, uh, revolutionary movements, but definitely also ventures. Like what are the narratives you use, for instance, because you're already in the space, but what are the narratives you use to your friends and to people that have been building things in software, in mobility, that are interested in climate? And how do we get them lured into, of course, not against their will, but how do we uh nudge them? How do we trigger them? How do we uh intrigue them enough to start working in the food and egg space? And what's holding them back currently? Do they think there are no opportunities? Do they think it's too small, which obviously is not the case? Do they think, etc., etc., consumers are not ready to pay for food as medicine? All of those are very strong narratives, or do they believe the narrative, or are they still in a narrative of the chemical input food industry or chemical input agriculture industry that we're all gonna starve if we stop using inputs, especially their inputs? And so I'm just curious, I'm really curious about these narratives and big work of this podcast. Of course, the podcast is listened to by people in the space already, the bubble, but I'm very and we are very interested in how to get out of the bubble. How do we get, and maybe not with an hour and a half podcast, but with what else can we use? What else media, what else media can we use, what other content can we use to get into the ears, into the eyes, and into the hands of people that are curious but are more the fringes, aka your friends and people around you. So let us know. As always, get in touch with feedback, uh, email is not my strongest point, but I definitely read it through the website, social media, etc. And definitely let us know what you think and thought about this one, and see you or hear you at the next one.
SPEAKER_00:Thank you. Thank you for listening all the way to the end.
SPEAKER_01:For show notes and links discussed, check out our website, investinginregenerativeagriculture.com/slash posts. If you like this episode, why not share it with a friend? And get in touch with us on social media, our website, or via the Spotify app, and tell us what you like the most. And give us a rating on Apple Podcasts or Spotify or your podcast player. That really, really helps us.
SPEAKER_00:Thanks again, and see you next time.
