Phil Taylor and Brandon Welch, the first investments of Mad Ag’s $10 million fund

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Phil Taylor and Brandon Welch of the Perennial Fund and MAD Agriculture just closed their fund of $10 million and the first four loans are out of the door, with many more to come. We discuss in this episode what they have learned about skin-in-the-game transition finance and partnering with farmers. We dive deep into the financial aspects of agriculture, with focus on the progress of investors and farmers. 

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Update on Perennial Fund

The fund closed in February 2021 at $10 million with 43 investors from seven countries. Phil and Brandon have 97 farmers in the pipeline and are currently speaking with 25 of them. Moreover, they just made our first four loans over the last couple of months.

“We are drafting documents, starting to distribute loans out. We’re learning quite a bit, testing a lot of assumptions, making sure that we’re still being concrete in the mission and vision and where we are headed, but being flexible in terms of how we get there and making sure that we’re creating something truly useful for those that we’re here to serve, which are farmers transitioning to regenerative organic.” – Brandon Welch

From Farming To Harvest to Marketing

The whole idea behind the Perennial Fund is to provide loans that cover all aspects of the production cost: from land rent to crop insurance, seeds, diesel labor, transportation until anything farmers would need until harvest. Once harvest is ready, MAD Agriculture also handles the marketing of the produce, effectively partnering with the farmers in the whole marketing process so they become potential revenue holders as well.

“Some farmers need land and business planning, some farmers need capital, some farmers need Facebook accounts, but every farmer needs a market.” – Phil Taylor

Several loans and payment options are made available to farmers depending on their expected yield, monetary needs and ability to make payments. 

Building Authentic Relationships

MAD Agriculture’s approach towards business leans towards building authentic relationships with the farmers by helping them throughout the whole production and marketing processes. The transitional process includes turning farms into yielding organic produce only.  This provides a healthier environment and safer food for humanity.

“The regeneration of the land and human wellbeing is wrapped up, and that regeneration, foremost, is driven by diversity. And so the more that we can diversify the farm ecosystem, in terms of not only the wild spaces that it has, and can nurture, but also the cultivated spaces and people on it. So we use our market to do that work” – Phil Taylor

Vision For Perennial Fund

In order to create a structure for a perennial funding program, Brandon believes that the organization working as the financial vehicle needs to have a strong backbone supported by a steady stream of investments. The company closed the funding to $10 million last February and continues to grow globally with a funding target of $10 Billion by the year 2030. 

Further, Brandon shares that the food market is substantially strengthened by building strong relationships with the farmers, knowing their needs, and providing the means for them to make quality produce.

“Once you lift the hood on a farm and understand the vision of the farm, there’s always the need to purchase land or there’s a need to build infrastructure around storage, or maybe they want to value added vertically integrated, and they have a vision for a mill. That all requires catalytic financing” – Phil Taylor

Other Important Points Discussed 

Koen, Phil, and Brad discussed these points in this episode:     

  • How MAD agriculture teaches farmers the fundamentals of risk sharing and how to be revenue holders.
  • Empowerment of farmers in geographically isolated locations by connecting them through the broader reaches of the organization.
  • Holistic approach to business and all the people involved.
  • Ensuring that farmers receive fair returns for their yield, a global issue that needs closer attention.
  • How the business model can be an inspiration to other businesses while still being a good source of revenue with comprehensive ROI (return of investments).

To know more about Phil Taylor, Brandon Welch, and the Perennial Fund of MAD Agriculture, download and listen to this episode. 

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Feedback, comments, suggestions? Reach me via Twitter @KoenvanSeijen, in the comments below or through Get in Touch on this website.

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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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