By Gerelyn Terzo, Global AgInvesting Media
Mekong Capital, a private equity powerhouse that has long shaped Vietnam’s investment landscape, is poised to introduce a groundbreaking regenerative agriculture fund. But investors will have to wait. The fund, which is planned for 2026. aims to attract as much as $200 million in capital, according to a report in Bloomberg. This bold new initiative, confirmed by founder and partner Chris Freund, signals a strategic shift toward the ag industry for the firm. Mekong Capital’s latest fund, Mekong Enterprise Fund IV, attracted $246 million in committed capital, more than twice the size of its predecessor fund.
“We’re making progress getting that fund off the ground and currently at a stage where we’re working on the pipeline” of potential companies to invest in,” according to Freund cited by Bloomberg.
Perhaps as a forerunner to the new regenerative ag fund, a year ago, Mekong Capital invested $5 million into biochar and fertilizer company HUSK, which engages in regenerative ag in the Southeast Asia region. Indeed, the financial tide appears to be turning for regenerative agriculture. Valued at a robust $7.53 billion as of 2023, the global market for these sustainable farming practices is on an explosive trajectory, projected to surge to an impressive $25.03 billion by 2032, reflecting a Compound Annual Growth Rate (CAGR) of 14.3% over the forecast period.
By championing soil health, biodiversity and significant carbon sequestration through techniques like cover cropping, reduced tillage and agroforestry, regenerative ag methods are proving they can boost productivity while simultaneously mitigating climate change. A potent trifecta of escalating consumer demand, powerful government incentives and corporate sustainability commitments is accelerating this widespread adoption.
Through its new fund, Mekong Capital will target the agtech sector through the lens of areas such as forestry, organic fertilizer and even ocean health, reflecting a broader commitment to sustainable innovation. Freund emphasized the critical role of data in this new agricultural frontier. He believes companies operating in data-rich sectors capable of collecting, analyzing, and leveraging vast amounts of information are exceptionally well-positioned for future growth. Mekong Capital is actively exploring how data technologies can boost the performance of its portfolio companies.
Founded in 2001, Mekong Capital has a storied history in Vietnam, having launched five funds to date. Their most recent, Mekong Enterprise Fund IV (MEF IV), commenced in 2019 with a robust $246 million in committed capital. This latest venture into regenerative agriculture marks an exciting new chapter for the firm.
Southeast Asia is a burgeoning region for agriculture investing of late amid a booming population, rising incomes and a notable shift toward sustainable and regenerative ag. Earlier this year, Australia’s New Forests scooped up a controlling stake in Burapha Agro-Forestry, a timber plantation forestry company located in Laos along the Mekong River. That deal was part of New Forests’ strategy to develop an integrated and scaled investment allocation in Laos, currently comprised of two investments: Burapha and Mekong Timber Plantations. The investment firm’s timber fund has access to nearly 85,000 hectares (210,039 acres), including roughly 15,000 hectares (37,065 acres) of planted area.
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