March 26, 2024

By Lynda Kiernan-Stone, Global AgInvesting Media

Understanding that ag investment has long been a compelling asset class that has traditionally been inaccessible to individual investors, Harvest Returns has quickly become a disruptor by providing growers a streamlined, flexible source of capital, and offering qualified financiers and agribusiness entrepreneurs a curated, diversified portfolio of farms, ranches, and timberland investment opportunities.

Now, as farmers, ranchers, and agribusinesses are operating in one of the most constrained credit markets in decades, Harvest Returns launched its first Agriculture Private Credit Fund in December 2023 with the goal of deploying capital in a more efficient way to its farming and ranching partners. 

“With the banking crisis and farm lending contracting, agribusinesses need flexible, creative financing, now more than ever,” said Chris Rawley, CEO, Harvest Returns last year. “Our private credit deals solve that problem for farmers and ranchers, while at the same time providing high yield, secured income for our investors.”

Headquartered in Ft. Worth, Texas, Harvest Returns was founded in 2016 by two military veterans to democratize the ag investment process by connecting individual ag investors with producers in need of capital looking for an alternative to traditional bank loans. To-date, the company’s pool of more than 15,000 investors have helped farms, ranches, and agribusinesses raise more than $35 million in capital. 

“The farmers and ranchers we talk to are looking for flexible terms and creative financing solutions,” said Rawley. “Many of them are operating on family-owned land, but lack resources to expand production. Especially in the regenerative livestock space, we see a growing opportunity for strategic deployment of private capital to help regrow record low cattle herds impacted by droughts and wildfires.”

Targeting high-net-worth investors and family offices, this new fund builds on Harvest Returns’ track record in private lending. Since 2018, and throughout the volatility and uncertainty of a global pandemic, the company raised nearly $15 million in individual private credit offerings and distributed in excess of $12.7 million back to investors as loans matured. And from 2020-2022, the weighted average returns of the company’s private credit livestock offerings were 12.9 percent – exceeding the average returns posted by the S&P 500 Stock Index. 

Collateralized with real assets, this new fund will build a diversified loan portfolio across a variety of geographies and business types, and is designed to provide investors with a consistent stream of risk-adjusted income and capital protection.

Harvest Returns explained that these debt investments will hold senior positions over the underlying common equity investor in terms of payback priority in the event of a bankruptcy or default.

Rawley stated that although a number of farmland funds have emerged across the country, he sees ample opportunity for additional deployment of debt funding to credit-worthy producers who are underserved by traditional agricultural financing channels. Reflective of this need, the fund already had its first close in early March, and has successfully deployed capital to agribusinesses across the U.S.

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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