How to build the ideal regenerative fund structure with Wood Turner and Atish Babu, Agriculture Capital

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In this interview, we take on this challenge with regenerative agriculture fund managers Wood Turner and Atish Babu of Agriculture Capital. Together they have raised 800 million across two funds for permanent crops in the last six years. We talk about key points, how did they start their mission in regenerative agriculture, how do they think about the future, how would they structure the ideal regenerative fund, and many more!

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What Brought Them to Regen Ag

Wood Turner, VP at Agriculture Capital, shares that his long-standing belief that agriculture is an essential part of how humans live on the planet brought him to regenerative agriculture. He mentions that the need to produce food sustainably, regeneratively, responsibly, has never been greater than it is today.

“As populations continue to grow, pressures on our food system, pressures on the transportation system, pressures on how we do business and how we live continue to increase. Doing this the right way is absolutely essential, so this, for me started at a very young age and only amplified in the last several years.”
Wood Turner, VP Agriculture Capital

Atish Babu, AVP of Agriculture Capital, chimed in with his views on regenerative ag. Coming from a tech and tech financial background, he did not expect to grow his interest and concern over climate change so much. 

“You start with carbon emissions. You very quickly get to agriculture, the second-biggest carbon emitter following oil and gas and then when you start thinking about agriculture, and how to affect change looking at some of the primary causes you realize, a lot of problems and opportunities around agriculture and climate change has to do with soil and how we treat and manage that soil.”
Atish Babu, AVP Agriculture Capital

Soil and High Quality Food

At Agriculture Capital, they believe that agriculture plays a huge role in helping reduce atmospheric carbon. However, the most important concern for humans in the food world is the connection between soil and high-quality food.

I fundamentally believe that the core of responsible agriculture and certainly regenerative agriculture is: growing food in the soil. It is a land management philosophy. How do we expand responsible practices across as many acres as we can possibly can in food production in order to have the biggest impact on how we manage land and the impact on how we manage that land has on the climate, has on water resources and so on.”
Wood Turner

Agriculture Capital at a Glance

Atish shares that at present time, Agriculture Capital is managing 20,000 acres of citrus, blueberries, table grapes, and hazelnuts on the West Coast of the US and Australia. They have a team of 30 investment professionals and 400 full-time employees in management, packing, and processing departments throughout their farms in California, Oregon, Washington State, and Australia.

“Today, we are focused on strategy, growing in those crop areas food that people want. People are increasingly are desiring for more fresh and convenient foods. Doing so in scale, vertically integrating between farm and primary processing and managing the operations in a regenerative way.” Atish Babu

In terms of the publicly available information on their investment program, they have 800 million US dollars between two funds. The first fund was a 250 million US dollar fund that was raised in 2014, and the 2nd fund is 550 million dollars US fund, raised in 2016.

Advancing Conversations to Potential Investors

Wood shares that it was an interesting time when Atish and he started around five years ago. They were challenged in advancing conversations with potential investors at that time on what role regenerative agriculture could play and how this business will move forward.

“Not all the answers are clear but we’re seeing a significant increase across the portfolio in terms of habitat conservation and some of the indicators associated with that Increase is: organic matter as an indicator of soil health and other benefits that I think are really exciting.” – Wood Turner

The team is leaning on the research to help others understand and they believe this will continue to raise the bar on discussions about regenerative agriculture.

“I come from businesses, who were enhancing value through sustainability through regenerative practices over 25, 30 years of engagement. I still fundamentally believe that long stewardship is absolutely essential to start seeing the value that can come from these practices.”

Links:

Agriculture Capital Website

2019 Agriculture Capital Impact Report

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The above references an opinion and is for information and educational purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.


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