By Lynda Kiernan
Farm Credit Canada (FCC) has partnered with Calgary-based venture capital firm Forage Capital Inc. to launch a new $100 million (US$72 million) venture capital fund designed to support proven, viable companies facing unexpected challenges due to incidents such as the COVID-19 pandemic.
FCC is the leading Canadian lender to the agriculture and food sectors, with a loan portfolio in excess of C$38 billion (US$27.36 billion). As a self-sustaining Crown corporation, it provides flexible, competitively priced financing, management software, and information and expertise focused on the agriculture and food industries, while also generating returns for its shareholders.
Named the Agriculture and Food Business Solutions Fund, the new investment vehicle will provide stability and flexibility needed to rebuild business models after experiencing unexpected disruptions.
FCC will be the sole investor in the fund, which will offer flexible financing solutions such as convertible debt investments, that will give companies the ability to pay down debt, or give the investor equity in the business. And although the fund is being launched amidst the COVID-19 global pandemic, Michael Hoffort, president and CEO of FCC, noted that it will continue beyond the current crisis to support endeavors facing unforeseen events in the future.
“This strategic investment is another way FCC is supporting growth and innovation in the only industry we serve – especially at this time,” said Hoffort. “As a commercial Crown corporation, we serve as a catalyst for private investment in Canada’s agriculture and food industry and we are here for the long haul, through all business cycles.”
And Did I Mention Another C$50M?
In addition to its commitment to the C$100 million Agriculture and Food Business Solutions Fund, FCC has also recently invested more than C$50 million (US$36 million) across three venture capital funds, all working to support the country’s ag and food industries:
InvestEco Sustainable Food Fund – FCC has made a C$20 million (US$14.4 million) commitment to the $100 million to this fund that focuses on private, expansion-stage companies working to promote health and sustainability in the food and ag sectors. Fund manager, Toronto-based investment firm InvestEco Capital offers expertise in sustainable agriculture and food production, believing in the connection between these activities and environment and health outcomes.
District Ventures Fund – Based in Calgary, District Ventures was founded and is led by general partner, investor, and entrepreneur Arlene Dickinson. FCC also committed C$20 million to this C$100 million fund that has honed in on the food, beverage, health & wellness, and beauty sectors. District views these sectors as offering particularly strong opportunities for growth based on demographic trends and consumer shifts toward sustainability and social stewardship. Offering more than capital, District Ventures’ portfolio companies gain an ecosystem that offers the opportunity to scale through access to leading experts and mentors in sales, distribution, and retail; the development of impactful marketing strategies; the creation of e-commerce platforms; increasing brand equity; positive exposure to both North American and global markets; and the improvement of operations, financial, and legal management.
Ag Capital Canada Fund – FCC has committed C$12 million to this fund, accounting for 50 percent of the C$24 million fund’s total capital. Ag Capital Canada focuses on Canadian businesses in need of growth capital and business mentorship, offering funding and entrepreneurial expertise.
Bioenterprise – FCC has committed C$1.35 million to this non-profit corporation. Established in 2000, Bioenterprise offers mentorship and support services for Canadian enterprises and innovative companies in the agribusiness and agri-food sectors. With a network of regional offices, Bioenterprise gives hands-on mentorship for innovative startups, and FCC’s commitment will help to expand its services into underserved areas of the country.
“Our investments focus on promoting innovation and sustainability within Canada’s agriculture and food industry, supporting start-up to growth stage businesses, as well as filling the gaps in financing for underserved parts of our industry,” said Hoffort. “This is another way FCC can support entrepreneurs and promote innovation and success in this exciting and dynamic industry.”
– Lynda Kiernan is Editor with GAI Media and daily contributor to the GAI News and Agtech Intel platforms. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.