Financing a Growing Appetite for Sustainable Food

Jo Anne Shatkin

CLF and CLF Ventures couldn’t be more excited about the opportunities for innovation in financing that build our regional food system. We’re working to foster greater investment in the innovations that will transform our communities, make us more self-sufficient and resilient to climate change, and build a sector that will sustain us over the long term. That’s why we recently partnered with Federal Street Advisors, a wealth management advisory firm for families and foundations, to co-sponsor a regional summit, Financing a Sustainable Food System for New England. Together with Federal Street Advisors, we gathered a select audience of interested investors and invited both seasoned and emerging entrepreneurs and experts from around New England to tell their stories, focusing on the critical issues in growing and financing sustainable food businesses. The room was full of excitement, stories, and passion for food, and several important themes emerged:

  • GROWING DEMAND FOR SUSTAINABLE FOOD:

    (L-R) Mass. Agricultural Commissioner Greg Watson and Ed Maltby of Adams Farm Slaughterhouse

    Greg Watson, Massachusetts Agricultural Commissioner, explained that supply currently can’t match demand. He proclaimed that this is not a trend, “this is the future of agriculture!”

  • NEED FOR ALTERNATIVE FINANCING:
    Several entrepreneurs, including Ed Maltby of Adams Farm Slaughterhouse and Bill Eldridge of Maine’s Own Organic Milk, spoke of the need for alternative financing that allows the organic growth of their business and matches the timing and return expectations of their business models. While some models do create high value, others are challenging to do profitably, because the value of the sustainable dimension is not yet captured in the economics. For example, farming organically creates the need to certify, but for smaller growers, the “local” advantage can’t compete with large national businesses.
  • CONTRIBUTION TO CLIMATE RESILIENCY: 

    Dorothy Suput, The Carrot Project

    Many panelists discussed the role of sustainable agriculture in addressing resiliency to climate change, including Roger Berkowitz of Legal Sea Foods, who mentioned fish ranching as a strategy to address the declining coastal fish populations resulting from warming waters, and Henry Lovejoy of EcoFish, who explained, “We don’t need to raise any food that’s bad for the planet.”

  • NEED FOR AGGREGATION: Aggregation was a theme — farmers and investors alike can benefit from pooling resources to make innovations, and investments in them, sustainable.

There were many key ideas conveyed, but I have to commend Chuck Lacy of Hardwick Beef for delivering two memorable take-aways:

  • “You can’t just show up and get my tenderloins!” (Relationships are critical)
  • “If you’re lucky, you will plant a seed that will help change an industry” (to potential investors)

Raw bar, courtesy of Island Creek Oysters

Of course, no sustainable food summit would be complete without good eats, and the Financing Sustainable Food System summit showcased an abundance of local and regional treats, including grass-fed beef stew with panelist Chuck Lacy’s Hardwick Beef, fish and seafood from panelist Jared Auerbach’s Red’s Best, and many donated items, including an Island Creek Oysters raw bar, desserts from Henrietta’s Table of Cambridge, an assortment of prepared foods produced at Boston culinary incubator CropCircle Kitchen, and dozens of other tempting New England products.

CLF has a long history of work on sustainable agriculture issues in New England, including efforts to improve the sustainability of our fisheries.

  • CLF Ventures is working to regionalize a fish permit investment fund in the Gulf of Maine, aiming at the triple bottom line of social, environmental, and economic benefits.
  • And through our partnerships with Federal Street Advisors and others, we are evaluating the sustainability claims and working to bring structure and discipline to the innovation and excitement of social entrepreneurship.

CLF and CLF Ventures have a vision for reinventing our food supply that

  • builds on our region’s history and tradition of self-reliance and our roots in fishing and farming;
  • leverages our culture of innovation as a firm foundation for our regional economy;
  • creates healthier ways to feed ourselves;
  • combats climate change; and
  • rebuilds the health of our environment.

CLF Ventures co-organized the Sustainable Food System summit to discuss the benefits of investing in this growing economic sector, including greater food security and higher quality food, job creation, and improved quality of life for our urban and rural communities. The need to build capacity and sustainability in our food supply creates an opportunity to invest in sustainable economic growth for our region. Key to this growth is an understanding of the barriers — such as the need to aggregate production and distribution to scale, the need for effective financing models, for policy changes, for new public and private partnerships, for market development — and understanding the extent to which the emerging alternatives unlock the potential.

By design, there was a lot of expertise and activity in the room — from seasoned entrepreneurs and investors as well as from the next generation of innovators. We were fortunate to have generous co-sponsors: Goodwin Procter, Pinnacle Associates, Trillium Asset Management, and Eastern Bank. We are not the inventors of the idea, but we are the ones to carry it forward.

Stay tuned for updates on our urban farming work, triple-bottom-line funds, links between climate change, resilience, and sustainable farming practices, as well as entrepreneur stories, expert advising and more.

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