Transcript
Speaker: So Emma, we don't get to be in the same spot very often. It happens once every couple of years, it seems. But when we do, it's great to be able to make use of this time for a podcast like this. And today's going to be a little bit different because we're not going to have any other guests. It's just going to be us having a conversation, having a conversation about what are those things that we've observed over the last number of years working in this space about what makes for a particularly successful farm. This is a conversation that we want to have because there's a lot of folks out there who are either already in a farm or want to start a farm and are trying to figure out what's the best way to make for a successful farm business. And this isn't going to give you all the answers by any means, but it'll give us some time to reflect on some of the commonalities of good quality farm businesses and how to build out a strategy that works for you in your context.
Speaker: And I think we hope that this episode will be helpful for a variety of people. We are not farmers ourselves, but we're particularly interested in thinking through the economic models that surround farming and strategies that can allow farmers in particular, small-scale, diversified regenerative farms to make it work or to be economically viable.
Speaker: And so that's kind of the intention of this podcast, which we hope is helpful, whether you're an aspiring farmer, you are a farmer, or you're just someone more broadly interested in understanding the food system and and our agricultural sector.
Speaker: Before we get started, I want to just highlight that this isn't a podcast or an episode about how to improve your cash flow or like very tactical tips on how best to run a farming business.
Speaker: And we're not the right people to say that. There's a lot of great resources out of there. There's a lot of people that know a lot more about that, you know, that have experience farming. That can give you those tips. This is meant to be more of like a high level conversation, understanding farming within the broader context of our economy.
Speaker: And we'll flesh it out with stories. So it's not just going to be business theory. We're going to flesh this out with actual stories of farms that are out there that we've interacted with maybe or that that we've seen from a distance have have done well in their space.
Speaker: And so I think the key theme for this episode is, you know, what are some traits that we've observed across many of the farms that we've worked with that tend to work or that have made the business model work for those farms?
Speaker: And what can we learn from them? I think it's also important to note that we want to discuss this with respect specifically to small scale diversified regenerative farms.
Speaker: If you were entering this space with the intention of just maximizing your profit, especially if you have land already, probably the best thing to do would be to do row crop farming. So that's not really our question. Well, don't know about that, but at least in row crop farming, we don't have a whole lot to say about that because we don't get we don't get into that space very Well, I will say that from the investor side, we know that the most profitable farming is row crop farming. That's why all the investors that invest in farmland invest in row crop farmers.
Speaker: I would still stand behind that statement. Regardless, I think the question here is, if you want to be a small scale, diversified, regenerative farm because you feel like that gives you purpose, that is making the world a better place, that is making the food system a better place, what are the things that you can do to make that viable for you? Are we okay with that premise? We're okay with that premise. For the sake of ah keeping this going, we won't we won't debate the the profitability of row crop farming in particular.
Speaker: Let's start here. Emma, you had you had a list that you had prepared. So let's start with one of your first key factors. Yeah, so the first one is find your niche market.
Speaker: There's a number of examples that come to mind. One of the best one that I can think of of someone that I've spent time with is this farm called Raw Farm. They are a dairy farm in California that sells raw dairy under their brand into the supermarkets. California is one of the few states in the U.S. that allow the sale of raw dairy in supermarkets. And they are incredibly profitable, which is something that I had never come across before. I believe when I talked to them, he had said something along the lines of $30 million in revenue, $10 million in income. oh wow.
Speaker: My jaw honestly dropped. I'd never heard that. I know from talking to people in the raw dairy space that other raw dairy farmers are also doing really well. And the reason is that is a niche market and people highly value it.
Speaker: And it is not commoditized. It's not easily scaled. It's not legal to sell at scale in most states, which prevents, you know, any sort of like bigger. Can't have competition from another state. I think it's just a great example of you found your niche. It's a product that people really, really want. It's a product that people pay a lot of money for, and it works.
Speaker: Another example from an earlier podcast that we did is Peter Allen, Mastodon Farm. He started out basically doing meat CSA.
Speaker: He packages into monthly subscription boxes a nice mix of beef, pig, poultry, nicely packaged into like parts, diversified products.
Speaker: He allows some customization and he drop ships by and large to his clients in the Wisconsin, Minnesota region, but also nationwide. And i think that's another example of someone that has kind of found his specific market, people that really care about grass-fed meat in general, serving them well by allowing some customization, by cutting it into specific pieces. He's not just selling the quarter, delivering a product that people really want and that they can't easily get. from the supermarket for, and you know, for anyone that's looking to buy high quality nutrient dense meat in general, we all know that that is not easy to get in the store, especially if you want it across beef, pig, poultry.
Speaker: And also there's a lot of people who want to support particular farms. And his is an example of one of the most regenerative that you can see on the landscape because of the trees that he's established, the shrubs that he's established. Like this whole landscape is shifting towards a savanna ecosystem. And it's a very visual storytelling thing that a lot of people do want to support. So that certainly adds to the niche.
Speaker: One of the things that is i think is important to to highlight here is that when you find a niche, be also thoughtful about how easy it is or hard it is to sustain that niche. So, for example, we both visited White Oak Pastures, and they've told the story of how they were some of the very, very first ones, I think the very first ones in particular, of growing business.
Speaker: U.S. grown grass finished beef in the U.S. and selling to public, selling to Whole Foods. They were very influential in starting the grass fed movement into like a larger market like those grocery chains.
Speaker: However, once they developed the demand for it, so they develop developed both of the supply and the demand for grass fed beef at a larger scale through grocery stores, but then other people were able to come in and compete with them on price.
Speaker: Well, I would say more specifically, unfortunately, in that case, other non-American farmers were able to come in and compete. So Whole Foods is now basically, because of country of origin labeling rules, is basically selling grass-fed beef that comes from Argentina or Australia because they are producing at a way lower cost than American producers. Yeah.
Speaker: The country of origin labeling thing is is a whole other topic. Thankfully, I think it's moving in the right direction. But even still, whether it's folks in Argentina or Australia or New Zealand that are producing grass-finished beef at very low cost because this is what they do at large scale already, or just folks out maybe in the western part of the United States that already have a large amount of livestock out on pasture, cattle out on pasture, and they could keep them longer rather than selling them as stockers. They can keep them longer, finish them on grass, and then sell them at large scales to large grocery chains. It's not that challenging to produce grass-fed beef because there's already hundreds of millions of acres that are dedicated to having beef on pasture.
Speaker: So it can be a harder niche to to hold on to, similar to raw milk. If one business is making a lot of money, other businesses pretty quickly catch on to that. And i imagine that Raw Farms is going to have other people who want to get into that same space. and can bring capital into competing with them in that space. Oftentimes niches, especially in farming, exist for a while, but they might not be super durable. And you have to think about how do we retain this or how how might this change over time as we get more competition?
Speaker: Absolutely. So related to that, one of the ways that I think people can can develop durable niches is by focusing on not just the the products that are coming off of the farm, but on experiences. It seems that more and more people want to have farm experiences. A lot of people are disconnected from agriculture, but they want to be involved. They want to at least a nice version of agriculture that they can go to on the weekend. They can have a farm experience and they'll often pay for that, whether directly through for the experience itself or by bringing money and grocery shopping to the farm. So one example of that in my area, and this is a very common type of example, is a small family-owned apple orchard that's near me, Weaver's Orchard.
Speaker: It does apples, but then all kinds of other fruits. It has a pick your own, they have a farm market there and they have events like they have events all throughout the summer and the fall and bring families out and it's a great place to come out and there are orchards like this all across the country they serve kind of an agro tourism thing for their area And the nice thing about that is if you're providing these experiences to your local community, someone else probably isn't going to come in and out-compete you, or at least someone two hours away is not going to out-compete you because people in your community are closer to you. So if you're providing a valuable experience, a great time to get out with the kids and the family,
Speaker: ah Having a a farm experience, whether that's farm tours or an orchard or whatever that can look like, that's a valuable way to to bring the public in and oftentimes can bring in a lot more money than just growing the agricultural products itself.
Speaker: Yeah, absolutely. It's incredible how much people are willing to value these experiences. yeah And like you, I've also seen a lot of farms that are able to make significant amount of of money from tours, pickings, glamping, like all sorts of things. We're hungry not just for food, but we're hungry for the right type of experience. Absolutely. Absolutely.
Speaker: Another common trait, and i think in many ways this was maybe first popularized by Joel Salatin, is this idea of enterprise stacking. i think Joel also, he's done some talks and YouTube videos about this. He's also at times called it stacking fiefdoms. But basically, it's the idea that while with conventional agriculture, you typically just think of scaling horizontally and bringing more acreage under management. With the Joel Salatin or the regenerative model, you can think about stacking functions and increasing layers of complexity on the same land.
Speaker: Which often looks like having more products to sell at your whatever your market is, right? Exactly. So in the case of Joel Sarton, he has the beef.
Speaker: So he has cattle that are rotated daily, building topsoil and managing the grasses. He has the egg mobile, so the broilers that follow the cattle. he has the... the eggmobile.
Speaker: He has the broilers. He has the pigs. I think he even does a little bit of timber. He has turkeys, sheep, rabbits, and then he even does some education and things like like like that that we just talked about. So The key there is, and I think Joel Sauten also talks about the need to start simple and need to start with with one basic operation that kind of justifies, you know, your operating cost.
Speaker: But the key is to kind of, yeah, find that base layer that kind of, for him, it's really the beef and the broilers that allows the operation. And then since you already have this land, you already have this infrastructure You already have labor.
Speaker: How can you add additional layers onto that? And, you know, for him, it's all these other animals that incorporating. And, you know, if you took the turkeys or the rabbits in isolation, it wouldn't pencil out, right? Like it's not going to like justify the land. It's not going to justify the infrastructure. But if you take it just as a thing layered on top of like a base operation that covers expenses, it's just, you know, a little bit of additional margin on top.
Speaker: And it allows you to kind of tap into that same market, the same person that's coming to you for beef, you know, that would also buy rabbits and eggs and et cetera. That's huge right there. Like if you already have someone that you're selling, that you're selling chicken to and you're already selling beef to, likely they want to eat pork as well. And if they're already buying those other things from you, they might as well buy pork from you. It's oftentimes easier to sell more to the people that you're already selling to than trying to sell to more people, more different people.
Speaker: So making use of the existing customer base that you have and being able to to sell more variety to them. And that can be the stuff that you grow. Sometimes it's not stuff that you grow. Sometimes it's stuff that you buy in, maybe in bulk from someone else. in your community and then you you sell it back again to your customer base because you've developed that customer base. And that's a super, super valuable thing to have done. that's an A customer base is an asset. And so being able to sell more things to that customer base is a very valuable business strategy.
Speaker: And I think a lot of the farmers that you know we've interviewed for this podcast would would have a model that falls into that. I mean, obviously, White Oak Pastures, classic example. Bob Quinn that I talked to he has grains as as his base operation, but he stacked on top of that a safflower enterprise business. That he processes on farm in his oil barn and like sells to restaurants and I think even the educational system in Montana. Okay.
Speaker: Yeah, pretty much any of the other farmers that we've talked to are doing that. I do want to stress, and I mean, this is not my point, it's Roel Salton's point, but that a common trap for farmers attempting this model is trying to stack too many enterprises all at once. Mm-hmm. And he talks of the need of first developing a single profitable, he calls it a mothership enterprise, and then adding the layer. Because obviously, none of this is easy. And I'm sure you've come across, I've definitely come across farms that have that are also struggling under too much yeah complexity. Yes,
Speaker: That's a big story that I've heard from a lot of farms is because we've pushed for diversity for a long time and having all kinds of different livestock. You see that on a number of of successful farms. People think, well, I should do this too. I should do multi-species grazing with all the different livestock. And I've seen quite a few farms who went to eight different types of livestock and they're moving all of them every day or every week. And then over time, they really, really had to pare it back. And part of that is like maybe some of these successful farms have a whole team of people involved with one person in charge of the beef cattle, one person in charge of the chickens, the pigs. And so if you have a team, it's easier to take on all of this diversity. But I've rarely seen one person be able to handle all of that and also do the marketing and all the other things that need to be done on a small farm to be able to get this to market.
Speaker: Being able to offer different products for a sale to the same market is very valuable, but also doesn't apply to all farmers, right? Like not all farmers are selling direct to consumers. In fact, most farmers are not doing direct to consumer sales.
Speaker: In that case, you might not have much opportunity to increase the amount of different things that you sell or maybe increase the amount that you're getting for each product.
Speaker: but you can address your input costs. So you can reduce the cost of producing whatever you're doing. And a great example of this is the story of Gabe Brown out of North Dakota. And we had him on the podcast not too long ago.
Speaker: And he was sharing that because of all of the things that he's cut out of his operation. So he grows row crops. So he has grown a lot of row crops over time. And because he's cut out the herbicides, the pesticides, the the fungicides, the the fertilizer. he doesn't have as many passes with the tractor and he's not burning as much diesel fuel because he's cut out so much of this and he's regenerated his land. His cost of producing corn is, I think he said $1.44 per bushel.
Speaker: That's his cost. And the cost for a lot of farmers in the Midwest is going to be about $5 per bushel. And per bushel That's a huge difference, especially in a, whether it's in a commodity game, whether it's, you have a differentiated market, that's a tremendous difference right there. And so the way that he said it is, Hey, look, if corn goes down to $3 a bushel, I'm still doubling my money.
Speaker: That's an amazing place to be as a farm if you're able to cut back your inputs that much. And he had reflected on at some point he had tried to produce as much per acre as possible the way that many farmers do. And over his more regenerative journey, he ends up shifting his focus to being able to bring his cost down and be able to produce food for as little cost per bushel.
Speaker: Yeah, so reducing your input costs as a key trait. I will add, just because I can't help myself on this point, because I think that this is a very like hopeful story. I think it's a story that you hear a lot in the regenerative space.
Speaker: I think it's a story that can be true for row crop farmers that are dependent on a lot of chemical inputs. Reducing your chemical external inputs ends up having a positive impact on your cost side and therefore your bottom line.
Speaker: I do also want to say that like I think that is over-generalized principle. I think that White Oak Pastures and Will Harris would be a ah great example of someone that would say that his regenerative model is not reducing the input cost versus a conventional farmer. And that when you reintegrate complexity, diversity, labor versus chemicals typically into your operations,
Speaker: In fact, you are probably increasing your cost. So I just want to say that like this thing that is sometimes presented as a truism in the regenerative hype that like by going regenerative, you are reducing your costs, I think is not always true. And I think that is important to recognize, although it can be true in certain cases. And it was true in the Gabe Brown case.
Speaker: you know Hopefully, the people for whom that is true, like it is very hopeful that that can be a motivator for converting to regenerative. And different industries are very different, right? Rail crops are very high input, especially the way that it's done on a conventional basis. is a super It's all input dependent for every single step of the process. Whereas, for example, beef tends to be pretty low input. like You use what's on the land, you're managing the land in order to produce the right kind of vegetation, but oftentimes it's already a pretty low input industry. So there's not as much opportunity in many cases to further reduce your inputs there compared to row crops.
Speaker: That's true. So another one that's related to this is building the resiliency of your farm and really focusing on what can I do to reduce significant downsides on my farm? Like if I get a drought, if I get a flood, if I get extreme temperatures, whatever that is, how can I be as much insulated from that as possible? Because those are often the times that really put a hurting on a farm. Even if the rest of the time is profitable, even if the rest of the time is good, if you don't have great resilience, that can really, really hurt your ability to farm long-term. So one of the stories that I have enjoyed learning about is that of Steve Gabriel. So Steve Gabriel, he's the author of the book Silvopasture. He's a farmer in upstate New York in the Finger Lakes area.
Speaker: And one of the things that got him into the business of Silvopasture was that he was running sheep, And his area had a pretty significant drought. And so everyone was feeling this. The price of hay went through the roof. People were buying grain in order to to feed to their livestock.
Speaker: but So the cost went through the roof for everything. and either they were having to pay a lot for feed or they were having to destock their operations or both. And he looked around his farm and he saw a lot of brushy areas on his farm that had oftentimes invasive shrubs. And he went through and he started to cut limbs off of those and leaves off of those. And he dropped those and made those available for his sheep because those were resilient. Those woody species had deep roots that were able to access water that his grasses and his forages could not.
Speaker: And those were getting heat stressed and drought stressed. And so by making use of this thing that was already on his farm, he was able to extend his feed throughout the whole drought season. He did not have to destock. His livestock actually gained pretty well during that period.
Speaker: And that was a thing that really got him into syllable pasture and the possibility of using this and then developing this resiliency very intentionally. So he kind of had something on his farm that he could tap into, but then he fleshed out in his book and in all of his consulting with people how to how to build this resiliency on on your farm very intentionally.
Speaker: I love that point. And I think that that's, you know, one of the hopeful things about regenerative agriculture. Because, I mean, I think a commonality that one sees in general is that there is this trade-off between efficiency and resiliency.
Speaker: And I think that is where regenerative, or however want to call it, can shine in moments of disruption or crisis. like we had during COVID, like we have every time we have a drought, having a diversified farm and business model is going to work better.
Speaker: So as we regenerate the landscape, as we increase the soil organic matter in the soils of a farm, they're going to hold water better. If it rains too much, our land is able to hold that water better. if it doesn't rain enough, it's Again, the land is able to hold the water better and longer and it's able to provide the moisture that plants need longer into a drought. So the more that we can build the quality of the land, the more resilient that we become to all kinds of different and stressors.
Speaker: And if we ever one day decided to get rid of crop insurance... we would really see this play out. That would be difference. Because I think that is kind of hiding the obvious in certain ways, or at least obfuscating it, because the conventional farms are propped up by it, and they don't actually have to bear the consequences of systems that are not designed for resiliency and changing. so and If you have crop insurance to fall back on, it doesn't matter as much what the quality of your soil is, if you can fall back on the crop insurance. And if you didn't have the crop insurance or it didn't have as much of it, wasn't subsidized as much, i think people would put a lot more effort into building up the quality of their soil as in that being their insurance policy.
Speaker: Yeah. I spent some time in northern Montana in the Haver region, very arid, challenging area. I was on a farm called Villicus Farm that's an organic grain farm. But that region, they get about six inches of rain a year on average.
Speaker: They had just gone through a three-year drought period when I was there. It was a region that wasn't farmed until about the 1980s. And when people kind of moved into farming in that area, then the chemical industrial model of agriculture was in full. swing and they farm wheat. And the way they do it is, you know, they they do it the very conventional way. They use all the inputs. They plant the wheat.
Speaker: If it's, um you know, a normal year, it grows. They sell it great. If it's a bad year because there's no rain or, you know, some other reason, like they just cash out on their crop insurance. So like that is a great example of like.
Speaker: And subsidized crop insurance, we should say, like what makes the crop insurance onerous in a way is that it's heavily subsidized. Right. So, you know, in a world where you didn't have crop insurance, that wouldn't be economically viable.
Speaker: And a system like that, like a more resilient version of that ecosystem would probably be a grazing system. Like that's probably what it's actually more adapted to is an intensive livestock production system that relies on those grasses. And those grasses have deep roots and deep perennial roots. Those are able to access moisture much more reliably, even if the rains fail.
Speaker: So you might not get as much of ah a high income as you would with a wheat crop. but you're you're much more steady and resilient year over year. Yeah, absolutely. Another important trait of successful, especially first-generation farms that we've worked with or seen is finding the right capital partners to work with.
Speaker: Again, unless you've come from a farming family and inherit the land, you are going to need to work with lenders and potentially even investors because the cost, no matter how you do it, Except for like in the case of a Greg Schuette, you're going to need pretty significant amount of capital. The biggest one is typically to access the land, but also even just for like working capital and infrastructure.
Speaker: Farms that have been successful at doing that, I found have typically found investors that are willing to be long-term patient and in it for more than the return.
Speaker: i think that one of the common traps I've seen some people fall into is work with investors that do want to make a really good return.
Speaker: And as a farmer, you just want to get into farming. And so if it means telling investor that you can deliver like a good return or market rate return for them, you'll do it because you just want to get farming.
Speaker: But I think that leads down the line to some misaligned incentives, some frustrations, some just like, you know, a bad partnership. Yeah, I've seen that too.
Speaker: If whoever is bringing the money to the table is not aligned with what the farm actually can produce or the farm related business can actually produce, that can get to be an awkward situation real quick, where we promised maybe a 15% return on investment, but turns out that it's it's a lot harder to make money in this particular space of farming. And maybe we can only provide a 5% return on investment or whatever that looks like.
Speaker: You don't want to be in a position where you stake the profitability, stake the viability of your farm on bringing in a lot of outside of capital, and then you might get that capital hold out from under you. That's a very stressful position to be in.
Speaker: So I think the key, you know, to someone that's thinking about going down that that route is find people that are in it for the purpose first. They might expect a return, but I think purpose needs to come first.
Speaker: I mean, a specific example that comes to mind for me is Autalt Co-op, you know, farm related business. Basically, former co-op building a direct-to-consumer brand. They were one of our podcast interviews a while back that we did together.
Speaker: World Within, my organization, we're a nonprofit. We invested in their previous round. um So they raised about $3 million dollars from values-aligned investors to build out their operation, buy a processing facility, etc As we've seen, and as all the other investors that joined the round have also seen, this is going to be a long-term process. yes And, you know, we went into it because, you know, we fundamentally believe in building this like decentralized, localized food system and its importance to our society and to everyone. We did not go into it because we think this is the easiest and fastest way to make money. You're not looking to shake them down for a lot of return on your investment in two years. Right, exactly. And so I think that is very important. For Old Salt, you know, it has been and will continue to be very important to bring to the table investors that understand that and that are willing to weather with them for the long term. There's investors. there's all kinds of different capital, right? Most people are probably not going to be dealing with investors. Most farmers are probably going to be looking for a farm service agency, NRCS for grants. like There's a lot of places that you can go and look for free money or for subsidized money. for And that's number one. or is That's for number one. i'm here for Always go for free money and be careful of taking on yes onerous debt.
Speaker: If you need to, and some businesses are are different than others, like old sales, co-op, if they need to buy a processing facility and that kind of stuff, that takes a lot of money. But if you can avoid taking on a lot of debt, that's going to give you so much more flexibility and reduce your stress and having to be able to get a lot of income quickly coming out of the farm.
Speaker: So one other way to do this, and I think this is going to be more and more important in the decades ahead, as the cost of farmland continues to go up faster than the cost of like whatever you can produce on that farmland, is being able to split land ownership and operations.
Speaker: And what I mean by this is I think the old model of farming is that you had to own all the land. Like you buy the farm and you're able to cash flow it. And oftentimes that's not the case today because of land becoming a more investable commodity for people who are not going to be farmers themselves. So one good example of this is a farmer named Greg Judy. He's based out of Missouri, a very well-known speaker in the grazing world. And he built up his business largely by leasing land and leasing land often for little or no money. But what he was, the value that he was bringing was these were in many cases, absentee landowners who lived in town, they had this family farm, or they bought this retreat farm, this place that they could go and hunt and recreate, and he could be the boots on the ground, help their farm look nicer, maybe he's paying a little bit that helps them pay taxes on the land, but generally he was not paying a whole lot for the land access, versus if he had tried to buy the land and they had a cash flow to payment on the land, would not have been possible.
Speaker: Also in his livestock operation, rather than buying in his entire herd of of cattle, oftentimes he acted as a custom operator. So it was someone else's beef cattle and he was paid as an operator, as a manager to run the cattle for them. And so he was being paid by the day per head ah for livestock that he didn't own. He didn't have to put up the pretty significant capital to have a beef herd. on land that he was often not really paying for. And that model, in his case, was a fantastic way to develop his farm. And over time, I think he's he's acquired other farms and he has much more of his own herd now, but that was super important for him to establish his farm in the early days without a whole lot of money. And he talks about this in his book, like he had almost no money in his bank account. And by doing this, he was able to get into farming in a very capital intensive form of farming, but do so creatively. And it doesn't work for everyone. Like not everyone has a lot of absentee landowners in their area, but in his context, it worked great.
Speaker: Absolutely. I think i'm a hybrid of that also works very well. And I've seen that with a lot of farmers where you might own a plot of land where your base operation is, but then you rent around you. And I think that can be ah a good hybrid as well.
Speaker: And think it's important to point out that you're typically able to lease land for a fraction of the cost of what it would be to to buy the land or make payments on the land when you're buying the land. In the U.S., the average cost of grazing land is about $1,500 per acre on average. This is across the entire country. And the average cost of leasing grazing land $15 per acre.
Speaker: And there's no way that you'd be paying $15 if you had to make your payments on that land. Another common or important trait is leveraging your community.
Speaker: So a lot of the things that we've already talked about in in various ways, I mean, aqua tourism experiences, yeah it's a way of leveraging a community. Leveraging a community like inherently gives you a competitive advantage. That's it like that. cannot be commoditized.
Speaker: I think in the U.S., leveraging your community has often looked like you know a CSA model. We need to support agriculture, using that model to raise the capital ahead of the season to be able to pay for the seeds and the planting and the labor and all that and sharing in the risk.
Speaker: The most inspiring example that I can think of and that i hope could become more common in the U.S., is a farm in the UK. I'm actually going to be interviewing the lady that runs it in a future episode. I'm very excited.
Speaker: It's called Ford Hall Community Farm. And she has an incredible story. So she comes from multi-generation farming family, but they had been farming on leased land owned by a landlord. That's actually very common in the UK because the history of lords. Basically, they you know, this heir to this land and decided, need to sell the land. And so in 2006, Charlotte and her brother Ben were in their early 20s, found themselves at risk of being evicted. And they had six months to come up with 1.2 million British pounds to buy the land if they wanted to keep it, which was way beyond anything they could afford. And so what they ended up doing is creating basically a land cooperative. It's a specific kind of structure in the UK and running a crowdfunding campaign. To buy the farm. To buy the farm. Wow.
Speaker: And they you know promoted, they talked, they shared their story, they did all sorts of outreach in their community and even beyond. And they were successfully able to raise the capital to buy the farm.
Speaker: The minimum amount being $50. They ended up getting little checks from 8,000 different people. So they have 8,000 different owners of the farm. 8,000 different owners of the farm. Wow.
Speaker: And what they really saw was like, you know, they started to do some outreach in their community and talk to the people that obviously this matter to most. And that resonated with them, of course. Because, know, people want farms in their community. so You know, that farm had been around for a while. People had driven by it. People had seen them at the local market. Like, it meant something. Mm-hmm. And the story ended up being picked up by The Guardian and kind of getting into the like national news cycle.
Speaker: And they found that the story resonated more broadly with people in general who somehow found themselves in the story of this like brother and and I think that's an incredibly hopeful case study of the power of just leveraging community.
Speaker: They ended up sparking a kind of community farm movement in the UK. There's now about 20 community farms like this. So farms that are basically owned by 5,000 to 10,000 people wow who are like co-owners in this. Yeah, I think it's something that I find very inspiring and I hope could become more prevalent in some form or another in the US. Right. Okay.
Speaker: And presumably in that case, if you have, say, 5,000 different stakeholders or different owners, you're not having to pay them each 25 cents or whatever it is, whatever that would be per year. There's something else that they're getting other than just a monetary payment because that would be a whole headache and a half. Exactly. And the way it works technically is, so you buy a share, you're now a partial owner of the farm.
Speaker: And each farm does it slightly differently. But basically that share, like let's say you bought a share for $50. If down the line you wanted to sell your share, you could sell it back to them and they would basically sell it to another person who would come in.
Speaker: I think what they found is that very few people do end up selling their share because yeah this is about the purpose more than... This is about supporting a farm rather than this isn't a financial investment that they're making. That makes sense. um But you could.
Speaker: And there are some other farms that have even like there's another farm project in the UK that combines a farm with an industrial park. And so they're a biodynamic farm, but they also have like a work office park where they lease out buildings to different companies. okay And that side of the business generates some return. And so they're actually, they also have like 5,000 small shareholders. okay But those shareholders are able to get like a very modest dividend every year. I think it's something like 3% or something. it's okay if It's quite low, but it does actually give them a little more. Interesting.
Speaker: So there's ways to get creative about land ownership and using tapping into a community that I think does really want for local farms to exist and thriving creative farms to exist and are often willing to put at least some money into that.
Speaker: Right. Because I want to stress, like, you know, let's say you are first generation farmer and you now want you need to access, need to buy land or partner or someone that can buy land for you so that you can farm.
Speaker: It's possible, but it's not the easiest thing ever to find patient long term investor that would want to buy the farmland and lease it to you. At a, you know, quite concessionary rate.
Speaker: Possible, but not easy because that investor would have to be motivated by purpose because yeah you would make much more money, you know, if you really want to invest in farmland, leasing it to a conventional farmer or just sticking your money in the stock market or into real estate.
Speaker: However, you know if i came to you and I was like, Austin, like you know I know you, I'm in your community. Would you be willing to put in $100 so that together we can buy land so I can have a farm and you can come there with your kids and there'll be trails and all that kind stuff? like You might be down. yes We want these things.
Speaker: To have a sense of ownership is very valuable there. To know that you are part of making this farm possible and then being able to access that farm in some way or another, even if it's not a big way, I'd put my money there.
Speaker: Exactly. Coming out of this, another powerful strategy is telling your story. I think a lot of the farmers that we've talked to on this podcast do a great job of that.
Speaker: I think that matters in all sorts of different ways. In the case of Charlotte and the Fort Owl Community Farm that i just talked about, telling their story was everything. Like, that's how they were able to raise the money. Mm-hmm. It's like by telling a compelling story and telling why they want to do it, why it was important for them to be farmers. Mm-hmm. I can think of our recent interview I did with Glenn Elzinga of Otterspring Ranch. i mean, he does an incredible job of talking about incredible nutritional benefits of his beef that is you know goes up into the mountains in the summer and grazes 300 different like native species of grasses and... And they're out there on horseback and some gorgeous, stunning landscape. Boy, the pictures that come out of that farm are stunning. Exactly. And so they have customers from all over the world because they're selling a very unique product thanks to their storytelling.
Speaker: Another version of this would be White Oak Pastures. And if we want to take this full circle, as then we talked at the beginning about how White Oak was one of the pioneers of getting grass-fed beef into supermarkets and developing the demand for that, they had competition that came in and put downward pressure on prices in the supermarkets. And what they have done in in response is they have adapted.
Speaker: They've told their story very, very well on across a whole bunch of different media. And they've also gone with much of their production now is direct to consumer, where they have ability to make use of that storytelling, right? They can tell their story to people who really care, who want to support that farm in particular. So while they could go to Whole Foods and buy... grass-fed beef that's from Argentina, they want to support white oak pastures in particular for all of the groundbreaking work that they have done and for the fantastic farm that it is and bringing more jobs into the community, revitalizing their area, all of those things.
Speaker: telling their story has taken them from having a product that was initially was a great niche and then that that niche was challenged by other people coming in but now that they have a very very well established brand and direct-to-consumer relationship now that becomes a niche that's much harder for someone else to compete with because that they have that brand ownership and that that connection and relationship with their customers And i think one final thing i would love to just briefly touch on is the power and potential of cooperation, several or many farmers. Because I think a lot of the things that we touched upon, and building like building a stacked enterprise model where you're selling 10 different products, telling your story, doing direct to consumer sales. like These are things that can add a lot of value and that can allow you to compete in this
Speaker: you know, stacked against you system. But there are also things that are like a heavy lift and they're heavy lift for a farmer who fundamentally is already working really long hours just you know producing the food. And they're also not necessarily things that ah all farmers are passionate about. You know, some people do a great job telling stories and and love doing that, talking to audiences and yeah to customers. Other farmers don't.
Speaker: And I think that's fair. Not everyone is a Joel Salatin. like Joel Salatin is an amazing both producer and marketer. like he has He has a gift for communication, and he's going to be in the top 1% of that category.
Speaker: He's done very well for himself in building Polyface Farm that way, but that's not going to be the case for many people. Exactly. So I think that's where like farmer co-ops, marketing groups, things like that can like you know enable...
Speaker: A group of producers to align behind one organization. One brand. One brand that can do some of that work for a brand. Both of us have worked with Organic Valley, for instance, which is a a very large dairy cooperative. And most of the farmers that I work with are not going to be out there selling direct to consumer. They just want to focus on the production and they do very well at that.
Speaker: But then Organic Valley is the one who does all of the marketing, all of the all of the sales, all of those things. And that's taken care of by people whose job it is to focus on doing that very, very well.
Speaker: Exactly. So I think Organic Valley in New Mexico, you have grass co-op, so many more that are doing this. And I think that is incredibly important. yeah And there should be more of them. Yeah. And seeing more of those develop is going to be very, very valuable for farms in the regenerative agriculture space. Because... It is one thing to tell your own story and differentiate your own markets and and vertically integrate. But that can often be hard to do. Not every farm is going to do that well. And oftentimes it's it's best if you can focus on one thing and doing that really, really well, especially if you can be part of a larger organization that's able to help you out with the marketing, such as a co-op. Yeah.
Speaker: On the vegetable side, you know, I mentioned earlier, like CSA is a very good model. And it is. CSA, for anyone that doesn't know, also is you're basically creating like a kind of full diet, typically, of vegetables that you're selling to customers. So every week you get a box with your basically all the all your vegetables, all your in-season vegetables. And that's a great model for a number of reasons. However, that can also be complex yeah because you end up with farmers that have to grow 30 different types of vegetables. Yes.
Speaker: That can be, you know, for the right farmer that wants to take that on, that's amazing. For other farmers, collaborating with a few other farmers in your area and doing like a multi-farm CSA can also be a way and kind of leveraging that advantage. yeah Like you can maybe just focus on whatever it is, 10 crops and the other farmer 10 crops and the other 10 crops and then still get that same yeah benefit.
Speaker: We have a produce co-op in Lancaster County where I'm at. That's exactly what they do. So there's a rich group of produce growers in Lancaster County, Pennsylvania. And what that co-op does is it sources from local farmers and then it goes to the major metropolitan areas in our area and they do the sales.
Speaker: um So every farmer can focus on the production, but they still are able to get significantly more for their production because they're part of this co-op. This is just just a big picture overview of some of the things that we've seen over the years that tend to make for profitable farms.
Speaker: Obviously, this is not exhaustive. ah Hopefully, this has been a little bit of a little bit of inspiration for folks or a little bit of a reminder. like None of this is groundbreaking, but hopefully a reminder of some of the things that can be done on a farm in order to make this sustainable in all of the different ways, right? Not just ecologically sustainable, but sustainable economically. which we certainly need to focus on in order to make this truly regenerative. like We need good people to be able to be on the farms long term and to be able to make a good living from the farm. And that's what we want to see more of. Yeah. And I think it's important to remember that we live in a system that is stacked against organic and generative farmers.
Speaker: Broader changes to policy, to consumer values, to consolidation need to happen. But all of us that care about small farms right now also need to think tactical yeah and strategic and think about what can we do right now.
Speaker: Things that are in our control that we can make a difference in. And so hopefully this was just kind of like a little bit of food for thought around what are some of the things we can do to create a decentralized, small scale, economically viable, small farm economy.
Speaker: Couldn't agree more. All right, Austin. Thank you so much. Thanks, Emma. And such a pleasure doing these two podcasts in person after so long. This has been a lot of fun. Hope to do more soon.
Speaker: Absolutely. Agrarian Futures is produced by Alexander Miller, who also wrote our theme song. If you enjoyed this episode, please like, subscribe, and leave us a comment on your podcast app of choice.
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