After three years, Thomas Hogenhaven, founder of Planetary Impact Ventures, is back on the podcast. Thomas and his team just turned down a $7 million investment in their fund. That’s right—said no to $7 million. And this wasn’t some shady source of capital either. This was a serious, institutional investor, fully compliant with KYC requirements. So… why walk away?

It comes down to values and incentives. When you’re building one of the most radical investment funds in the regenerative space, with an evergreen structure and no carry, you can’t afford to compromise. If you let investors in who start nudging you toward their own impact goals- let’s say, a focus on water savings- you risk skewing your entire investment strategy. Drip irrigation might look great on a report measuring millions of liters saved, but that’s not the point here.

Instead the super brave thing to do is say no to these kind of impact measures and trust that the structure and the alligned incentives will automatically make sure you only invest in the most radical founders. This radical approach has ripple effects. Like you might refuse to invest in a company, for example a drone platform, which could be used to spray compost tea. This radical fund will force the company to sign as part of the investment terms to never use the drone spraying platform for the agro chemical industry, but only for agroecological purposes.

Do you see how a new investment paradigm starts to take shape?