As part of The Nest Family Office, our Food and Agriculture activities are dedicated to building a more resilient food system through supporting natural solutions and innovative technologies that change the way we produce food.
We envision a resilient food system, which operates within the planetary boundaries of the Earth. We imagine a mostly circular system, based on respect for all living beings and the farmers and agricultural workers at its core. We see a world in which the true price of food is understood and accounts for the costs borne by society and the planet. In this system indigenous wisdom and technology are intertwined to produce food regeneratively that can serve as medicine and provide enough nourishment for all. And while the dominant system is difficult to overturn, we strongly believe that by creating choices where once there were none, we will in the end prevail.
Why Now: Opportunity & Urgency
While evidence has been available for a while, the effects of global warming on our food system and vice versa are being felt by more and more people. Heat waves, floods, and supply chain disruptions bring to light the vulnerability of our food supply. Some regulators are finally approving more climate friendly regulations and making funds available for the transition. We could debate as to whether the actions they are taking go far enough, but momentum for climate-focused initiatives is growing.
As the problems of our modern food-system come to light, more people are envisioning new ways to grow, produce, and consume the food we eat every day. A growing number of entrepreneurs, researchers, and activists are developing solutions to transform our industrial food system into a local, diverse network that regenerates the environment; produces nutrient rich foods, and ensures farmers have sustainable livelihoods.
The opportunities are abundant and investors more receptive. Some thoughts include innovative farmer financing models, technology that provides insights into soil health, and agroforestry and aquaculture models that re-align farming with natural systems.
Challenges to be addressed
Prolific use of chemicals and antibiotics, along with a focus on the highest yielding varieties of crops, have removed complexity and diversity from both food and landscapes. While providing more food, at least until now, it also has resulted in increased pressure on the environment (impoverished or dead soils, reduced water quality and availability, increased erosion, rising greenhouse gas emissions, dead zones, reduced biodiversity…), increased production and consumption of nutritionally devoid food, and inequitable outcomes for consumers and producers.
The cost of cheap food, is actually really expensive. According to the UN, industrial farming costs the environment $3 trillion each year. When you look at the health effects of our food system, global malnutrition, obesity, and diabetes cost more than $3.5 trillion globally.
A caveat here is that many believe actions should be big. We should build complete alternatives for the existing system. But in fact, it does not have to be that way. As A Growing Culture says it so nicely: actions don’t have to be grand in scale; what they must do is weaken the fabric of the commodified system, even if in small ways.
Unsustainability of the system and its impact on the environment
Our industrial farming system poses a threat to natural resources, biodiversity, and energy, water, and carbon efficiency. The real cracks start to show when we understand how: (i) unsustainable practices are depleting and damaging resources, (ii) supply chains are being disrupted by climate and geopolitical events, and (iii) climate change increases the volatility and insecurity of the production capacity making it harder to maintain and/or restore productivity.
- About 80% of deforestation is the result of agricultural production, leading to habitat destruction, biodiversity loss, and additional CO2 in the atmosphere. (The United Nations)
- While the system produces enough food to feed the world population, it is far from efficient with one third of all food produced ending up lost or wasted. (World Food Programme)
- Studies as long ago as 2003 show that topsoil acidity (pH <5.5) affects around 30 percent of the total ice-free land area of the world, and subsoil acidity affects as much as 75 percent. Recent updates will probably show an even grimmer picture. (Food and Agriculture Organization of the UN)
- The world has seen an average 68% drop in mammal, bird, fish, reptile, and amphibian populations since 1970. Much of the loss is caused by habitat destruction due to unsustainable agriculture or logging. (World Wildlife Fund)
- Ocean surface acidity increased from pH 8.2 to 8.1 over the industrial era as a result of an increase in atmospheric CO2 concentrations. This corresponds to an increase in oceanic acidity of about 30%. Reductions in surface water pH are observed across the global ocean. (European Environmental Agency)
- Farms discharge large quantities of agrochemicals, organic matter, drug residues, sediments and saline drainage into water bodies. The resultant water pollution poses demonstrated risks to aquatic ecosystems, human health and productive activities. (UNEP, 2016)
To solve this crisis, we must focus on reducing the food-print of the system on the environment through more regenerative practices- both on land and in the ocean. Regenerative agriculture and aquaculture describes a holistic farming system with possibility to provide environmental benefits at both the local ecosystems and broader climate levels. Approximately five billion hectares (about 40% of the global land surface) are used for agriculture; transforming even portions of this to regenerative practices can have a massive impact. In our work to transition to regenerative agriculture systems, we must also acknowledge the deeply held indigenous wisdom in the space. Indigenous and Black communities have been farming this way for hundreds (if not thousands) of years, we must honor their traditions, learn from them, and make sure they are included and respected as leaders in the regenerative movement. By working with farmers to support and incentivize the transition to regenerative agriculture, we can improve water and air quality, enhance biodiversity, emit less carbon, and sequester and store carbon to help counter the effects of climate change.
Inability of the system to deliver a healthy diet
Due to highly processed foods and poor food production methods, even with access to enough food, the nutritional quality the food we eat is often very low. We are currently facing a trifecta of challenges when it comes to malnutrition: under nutrition, micro-nutrient deficiencies, and overnutrition.
"While access to sufficient food remains a conspicuous problem for far too many, hidden hunger lurks beneath the surface of the modern sea of cheap, plentiful calories flooding the westernized world." (Montgomery & Biklé, What Your Food Ate)
- Across the world, roughly 800 million people were hungry in 2020 and 2 billion people suffered from micronutrient deficiencies. (The World Health Organization)
- An additional 2 billion are estimated to be overweight with 600 million of those being obese. (The World Health Organization)
- Moreover, a 2020 review of research Johns Hopkins, suggests that the gut-brain axis, a two-way communication system that allows gut microbes to exchange information with the brain, may be one of the mechanisms by which nutrition influences mental health.
- While the percentage of income spent on food fell by half since the 1950s, the societal cost of healthcare more than doubled.
To start, we must change how and what we farm. We need to switch to inputs and production methods that enhance human health. We must support the production of different varieties of crops, that in turn leads to more diverse and nutrient dense diets. We need technology that measures the nutritional value of food and allows for economic models that reward farmers to take into account yield AND nutritional value.
As part of this effort, it is crucial to support further research to prove the link between soil health, gut health and nutritional value of food. In order to close the nutrient gap and ensure high quality diets, we must work together to improve food access but also spread education and awareness programs. We must educate people on where there food comes from and what it can do for their health. Ultimately, we hope to restore the act of eating as an ritual that connects us all back to nature.
Inability of the system to produce fair benefits to farmers
In our industrialized food system, large agribusinesses and food corporations have the most to gain. All the while, farmers are left struggling to make a decent living and consumers lack access to healthy food choices. Agricultural workers and rural communities bear the brunt of the externalities associated with conventional agriculture including increased exposure to toxic chemicals and pollution from farm run off.
- Consolidated corporate power dominates the industry with 6 corporations controlling 75% of the global pesticide market while 4 companies control 75% of the global grain trade. (Oxfam)
- Small farms make up 72% of all farms but occupy just 8% of all agricultural lands. (Food and Agriculture Organization of the UN)
- On the other hand, the largest 1% of farms account for 65% of agricultural land, giving large farms and agribusinesses disproportionate control of our food systems. (Food and Agriculture Organization of the UN)
Ultimately, transforming our food system will only be successful if it is done with justice in mind. By focusing on local food systems, and supporting diverse agroecological approaches lead by small scale actors, we can center farmers, agricultural workers, and communities in our approach. Embracing new types of financing and business models (scaling the CSA) can help these local systems thrive while increasing farmer´s financial well-being. We do acknowledge that smallholder farming alone, will not provide enough food for the world but large scale farms can be transformed into more sustainable operations too with crop rotation practices, cover cropping, reduced tillage, and less chemical inputs.
Outcomes we envision
We cannot solve our problems with the same thinking we used when we created them. - Albert Einstein
To realize our vision, we need to conserve and restore 6 key outcomes
Climate Mitigation & Adaptation
- Problem today: According to the FAO, agriculture accounts for a quarter of global emissions, and the entire food system accounts for more than one third. Our dependence on industrial animal agriculture has led to deforestation, peat land destruction and increasing methane and nitrous oxide emissions. We use fossil fuels to make fertilizers that fill our fields and run off into our oceans, limiting their availability to hold carbon within their soils and waters.
- Aspiration: We’re looking for solutions in GHG mitigation, carbon sequestration, and system resiliency for better adaptation to changing environmental conditions. By transitioning to regenerative agriculture we can both reduce the emissions associated with agriculture but also improve rates of carbon sequestration from the air into soils, trees, and plants. Of the top 20 most powerful methods to drawdown carbon from the atmosphere, 8 are based on agricultural practices and land use according to Project Drawdown.
- Problem today: Widespread use of toxic chemical inputs and disruptive agriculture practices is reducing biodiversity everywhere we look. According to the UNEP, our global food system is the leading driver of biodiversity loss, threating 24,000 species of the 28,000 (86%) at risk of extinction. Conventional agricultural is leading to less diversity and variety - whether in the soil, the oceans, or on our plate.
- Aspiration: When we realign our agricultural practices to work in harmony with nature, we consider the entire ecosystem. From this perspective, we are able to strive towards an abundance of diversity rather than higher yields. We make decisions that take into account the value of pollinators, fungi, and micro-organisms and that preserve and protect all species. Although the transition will take time, biodiversity is critical to global food security as it increases the adaptability and decreases the vulnerability of plants and animals, resulting in more food for all.
- Problem today: Life on Earth and our agricultural systems, which account for 70% of water use globally, are completely dependent on water. However, global warming is drastically affecting both the quantity (increasing rates of both floods and droughts) and quality (increasing pollution agricultural runoff) of water available to us. At the same time, conventional agriculture is depleting our soils and ecosystems, making them simultaneously less drought and flood resistant.
- Aspiration: When regenerating our soils, restoring local ecosystems, and applying precision irrigation tools to reduce the amount of water needed to grow our food, we will restore balance to local landscapes. These healthier soils will hold more water leading to greater climate resilience and less agricultural run off. In turn, this will create breathing room for the oceans. Toxic algae blooms will disappear, allowing for dead zones in the oceans to restore.
- Problem today: Today, most of our fields are filled with dry, dead dirt instead of healthy, vibrant, living soils. Our overuse of tillage, chemical fertilizers, pesticides, herbicides and other practices have degraded our soils, killing the soil microbiome while causing widespread soil erosion. According to the UN´s FAO the degeneration of topsoil is so severe that we likely have less than 60 harvests yet, highlighting the link between our soil health and global food security. In What Your Food Ate, Montgomery and Biklé document the link to how the loss of life in our soils also impacts the nutrients that end up in our foods.
- Aspiration: We must value and treat our soil as the living ecosystem that it is. We have to prioritize regenerative practices including no-till, cover-cropping, crop rotation, and lower our chemical input use in order to restore our soil´s microbiome and fungal networks. Restored and healthy soils have the ability to sequester carbon, fixate nitrogen, and retain water. Beyond the climate benefits, these healthy soils will allow farms to better withstand droughts, floods, and other weather events, creating a much more resilient system with sustained yield overtime. These healthier soils will also create more nutrient-rich foods, resulting in healthier people.
Seeing soil as a trust held for future generations would help us create economic institutions and arrangements that reward farmers for improving their soil rather than subsidizing conventional practices that degrade soil health. […] Increasing soil organic matter from 1 to 4 percent could reduce fertilizer use by almost three-quarters. (Montgomery & Biklé, What Your Food Ate)
- Problem today: Despite the huge increase in agricultural yields over the past century, many people still lack access to fresh, nutritious food. Research shows the importance of minerals, vitamins, and phytonutrients for our health and longevity, but our narrow focus on yields alone, has lead us to ignore the health and nutrient density of our food. We have more options than ever when we go to the grocery store, but almost all come from industrial agriculture, are highly processed, and do not provide the diverse and nutrient dense diets that humans need to thrive. Globally, 60% of all calories consumed come from just three cereal crops—rice, corn, and wheat—which do not provide the fiber or nutritional diversity need for our gut microbiome to thrive lack many of the nutrients we need to live well.
- Aspiration: Regenerative agriculture practices, which improve soil health, have also been shown to improve the nutrient density of food. Shifting towards local, seasonal, and diverse whole food diets can also strengthen our microbiomes while ensuring we have the nutrients we needs. Diverse, nutrients dense-diets have been shown to increase our immune systems, gut health, and mental well-being. To ensure a just transition, these nutrient dense foods must also be available and accessible to everyone.
Improved livelihoods and leveled playing fields
- Problem today: In our current system farmers are squeezed by high input costs, big food and agriculture companies, and consumers expectations for artificially cheap food. Across the world, our centralized and high-input food system is increasing farmer deb. Many farmers are unable to pay their bills, and in the U.S. debt is expected to reach an all time high of $496B in 2022. Additionally, farmers are often punished or shamed when they make the switch to more regenerative and sustainable practices (e.g., losing crop insurance when planting cover crops). Because of all of this, farming is increasingly seen as an undesirable profession, dominated by older demographics. Across Europe and North America, there is also a shortage of available and affordable land that is accessible for young farmers, with a similar gap in land financing options that are fair to farmers. We need more young people to take on the important role of growing our food and taking care our lands, but it isn´t hard to understand why they are opting for other options and fleeing rural communities.
- Aspiration: Instead, we hope to transition to a system where farmers are valued as stewards or the land and are compensated fairly. When farmers rely less on the inputs bought from large corporations and more on working in harmony with nature, they will also be able to decrease their costs and increase their livelihoods and in turn their overall well-being. To help makes this happen, we need greater resources for farmers (especially smallholder and BIPOC farmers) to connect with each other, gain access to new information, and increase their financial literacy. We must also enable new business models and types of offtake agreements that allow small farmers, growing a diverse array of crops to have consistent income and their fair share of the profits. All the while also supporting larger-scale farmers to improve their soil health through more sustainable practices. We aspire for a world in which farmers are respected and appreciated by their communities, and where the ability to make a decent living attracts new talent to the space.
Today, each of these outcomes faces issues stemming from an overuse of agricultural inputs, extractive production methods, and the destruction of natural systems. Through our investments, we aim to fund solutions that reduce and eliminate further negative impacts, reverse the damage already done, and adapt to new environmental conditions when reduction and reversal are not enough.
The beautiful thing is: the climate solutions we need already exist. They are ready and scaling in many parts of the world, relying on market forces, often supported by policy initiatives. Being de-risked for mainstream finance to follow suit. And the time is now because the speed of adoption of these solutions needs to increase. Massively. Or we might sweat even more in the years to come.
Our Approach and Focus
The greatest threat to our planet, is the believe that someone else will save it. Robert Swann
We believe realizing this opportunity requires a committed ecosystem of actors working towards a more resilient food system. As investors, we are dedicated to supporting entrepreneurs and philanthropists who create solutions that:
- Utilize technology to enhance and optimize nature based solutions.
- Develop innovative business models that regenerate local economies and prioritize farmers and growers.
- Facilitate the transition to a better system by filling a gap and serving a need in our current systems while longer term solutions take time to unfold.
Areas of investment
Our investments span across three priority areas that are crucial in re-aligning our food system with the natural outcomes we aim to achieve.
Adopting regenerative agriculture practices is crucial in shifting our relationship with nature from extractive to symbiotic. We partner with companies and researchers who develop solutions to scale regenerative agriculture through improved technologies and removal of barriers for increased access and adoption by farmers. We look for solutions that empower farmers and make their lives easier, giving them the resources, tools, or data they need to make the best decisions for their farm.
The ocean is a crucial food source as well as a major climate regulator, employer, and the home to an abundance of biodiversity. Overfishing, traditional aquaculture, and pollution threaten the natural ecosystems and the climate and economic services they provide. We work with entrepreneurs and researchers to fund solutions that seek to rebalance the health of our oceans.
Low Emission Proteins
Whether it is through alternative proteins or integrated livestock models, we need to produce proteins in a new way that emits less, pollutes less, and requires less resources than the current system. We look for companies offering new ways of raising, feeding, and producing proteins that alleviate the stress on the planet, regenerate the Earth, and enhance human health.
Across each of these focus areas, we invest with diversity, fairness, and equity as top of mind priorities in our decision making. We also will engage on these topics across investments to insure improvement and consistent scrutiny.
Today we are increasingly excited by a few specific solutions within these investment areas. We expect this list to grow and change overtime, but wanted to share our latest thrills with you:
- All the benefits of agroforestry and in particular silvopasture - Epic Foundation has done research showing that we can get to net zero emissions in agriculture with silvopasture and adding trees into croplands alone. Due to the time it takes for those trees to grow, the time to start investing in those assets is now. We are assisting Propagate to institutionalize agroforestry implementation and financing.
- Assessing the nutritional quality of our food - Once we start measuring the nutritional quality of our food and are able to link it back to production systems, this will open a whole new door for alternative economic models to reward farmers. It would allow them to get paid for improving their soil and for increasing the nutritional quality of the food they produce. Edacious is building a platform here that will allow for this.
- Biostimulants designed with natural systems in mind - A variety of studies show that introducing biostimulants to conventional farming practices, reduces the need for synthetic fertilizer by up to 50%. When these formulations are based on natural relationships found in nature, we see huge potential for aiding the transition to more sustainable farming methods on a large scale.
- The potential of seaweed - Seaweed has application both in farming as a biostimulant, in feeding people as a nutrient dense, high protein ingredient, and in reducing ocean acidification. Research being conducted by Hatch Innovation Services funded by The Nest and The World Bank will highlight potential for sustainable development of the space.
- The wide world of fungi - **We have been reading Merlin Sheldrake´s Entangled Life and following the research of SPUN and many others. We are in awe of the complexity, potential, and all of the unknown that exists in these natural networks hidden under the soil. Finding business models to accelerate adoption excites us.
- Farming co-operatives and community-led financing models for farmers - Through our partnership with Walden Mutual in New England and Farm For Good here in Belgium, we are witnessing the power of individuals coming together at the local level to create transformative local solutions.
Way of working
At The Nest, we believe that scientific innovation and truly impactful business models are crucial in creating the better food system of the future. We also believe that no one can solve this problem alone. We take a collaborative, pragmatic and system approach, looking at the food-system as an eco-system. As part of this pragmatism, we strive to support long-term solutions based in nature as well as technologies that can enable the transition of our food system over the coming years. In both cases, we identify gaps and see where we can connect the dots that can unlock transformative change (whether though direct investments, research, partnerships, or a simple introduction).
One finger cannot lift a pebble. Hopi Proverb
As an investor, we seek to bring additionality and catalyze investments towards innovative solutions whenever possible. We utilize a variety of financing solutions that work best for the entrepreneurs and partners we work with, allowing for maximum impact no matter the circumstances. First and foremost, though, we believe in the teams spearheading the change, and we partner with them for the long term.