As founding partners, Tikehau Capital, Unilever, and AXA joined forces to champion the scaling of regenerative agriculture through a private equity impact strategy. Each has committed €100M to the initiative. Since its inception, the strategy has expanded its ecosystem, attracting numerous investors and surpassing the €500M mark in commitments. Leveraging their diverse expertise, the partners aim to drive a significant shift towards sustainable farming practices on a large scale.
The Regenerative Agriculture Strategy’s
First Vintage
The first vintage of the Regenerative Agriculture Strategy was launched at the end of 2022 and achieved a notable milestone during its first year of operation by securing its initial deal with BioFirst Group, a leader in biological pest and disease control, as well as bumblebee pollination for high-value greenhouse and berry crops. This memorandum seeks to share the insights gained from the strategy’s recent journey, providing a transparent account of the experiences, successes, and challenges encountered, and offering valuable lessons for others advancing regenerative agriculture.
4 Lessons Learnt from the Pioneering Investment Thesis of the Regenerative Agriculture Strategy
1. Rigorous Impact and Financial Screenings Were Essential for Shaping the Investment Thesis
In the memorandum examine the detailed the strategy’s key impact perspectives for each vertical: inputs, equipment and machinery, ingredients, and transversal enablers.
2. The Impact Committee Brought Robustness to the Application of the Theory of Change
In the memorandum explore the details of the 3 crucial stages of the investment cycle where the Impact Committee members convene.
3. High Company Involvement Was Critical to Build the Impact Journey In the memorandum learn about the 3 key steps the Strategy has identified for successfully onboarding a company into its impact strategy within six months of closing.4. Balancing Impact Ambition with Business Reality Was Necessary to Select Useful Biodiversity Indicators
In the memorandum discover the 3 main categories of metrics the Strategy uses to understand an investment’s impact on biodiversity.
“Our challenge as the Impact and ESG advisor was to choose a robust impact KPI under a limited timeframe. Initially, for BioFirst we considered metrics like “avoided pesticides” and “avoided eco-toxicity,” but adapted to the data reality focusing on the Surface Covered KPI. With the management’s support, we selected additional KPIs to strengthen the future approach. We will continue to refine these metrics with BioFirst and other portfolio companies in the coming months.”
– François-Henri Derrien, Impact Lead at AXA Climate
Moving forward
The strategy’s ambition is to help build a thriving ecosystem for regenerative agriculture finance and foster positive dynamics around this transition.
The journey in regenerative agriculture investment is rich with significant opportunities. Progress in the main investment verticals “Alternative Inputs” and “Equipment and Machinery” has laid a solid foundation, while the emerging potential in “Alternative Ingredients” and “Enablers” presents exciting prospects for the future. The strategy remains dedicated to fostering growth in this sector, aiming to deploying efforts that may build a more sustainable and resilient agricultural system.
Actively engaged in initiatives like One Planet Business for Biodiversity (OP2B) and the UK’s Sustainable Markets Initiative, the Manager is also partnering with cooperatives to stay connected to farmers’ practices, challenges, and opportunities. As this journey evolves, the team is eager to broaden its network and welcomes any insights, queries, or opportunities.
With a commitment to transparency and openness, the team believes that sharing its experiences and lessons learnt will further promote the widespread adoption of regenerative agriculture. By collaborating with like-minded partners, we aim to create a lasting positive impact on both the environment and society. We invite you to reach out to learn more or to join us on this regenerative agriculture journey!
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