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While there are many different ways to invest in farmland, AcreTrader brings unprecedented access, liquidity, and transparency to the industry through a highly differentiated investor experience and platform. Below we discuss how our diligence, expertise, transparency, network, and company structure truly set us apart from other investment options like funds, REITs, crowdfunding platforms, and directly buying land.
Our comprehensive diligence process ensures that 1) only farms shown to be exceptional by our vetting process appear on our platform and 2) our offerings are managed end-to-end by informed, experienced professionals.
For farm sourcing, we have a dedicated internal team with extensive farming knowledge seeking off-market deal flow who then employ advanced geospatial analysis and data science in evaluating those farms. Our people are working every day to not only find great, investable farmland, but also to make sure that all our farms are closed and managed without problems.
This chart shows the different stages and kinds of work that go into each farm we offer on the platform.
AcreTrader’s expertise can be broken into two components: people and experience.
Amongst our people are farm managers certified by the ASFMRA, an organization of rural property professionals who set the standard for farmland expertise in the U.S. Transactions are hard so we also have experienced real estate agents on staff thinking about them every day. Our employees also include individuals who have directly purchased and managed hundreds of millions of dollars worth of farmland.
Beyond the 30-plus people who work at AcreTrader, including our farm analysis team and Investment Committee, we are also surrounded by an exceptional Board of Directors and Advisors. This includes the Chairman of the London Stock Exchange, the former head of the largest U.S. agriculture fund (with billions of dollars invested in farmland), the former CFO of Amazon.com, the current head of the world’s largest agriculture research laboratory, and others of similar experience.
Our expertise as a company is demonstrated very clearly by our track record. As of May 2021, our company has closed over 50 deals, and over $90 million of assets have been funded on our platform.
More notable is that billions of dollars’ more farmland have been researched but ultimately passed over for placement on the platform. Perhaps said differently, our team has particular expertise in saying “no” to deals that don’t fit our strict criteria.
As mentioned earlier, our company is underpinned by a commitment to three pillars: Access. Liquidity. Transparency. We take this very seriously, both internally with each other and externally with our farming and investing stakeholders.
We are committed to transparency not only in our offerings but also in our commitment to educating investors. We pour resources into tools and data that we make available to our investors and others to better inform decisions.
Beyond educational resources, we make the financials of each offering available to investors through our platform, we openly discuss downsides, we disclose facts about water, we provide location maps, we provide documentation in advance, etc. These practices are unfortunately not common enough, but our commitment to transparency is paramount because we want investors on our platform to be fully educated about the offerings so that they can make informed investment decisions.
The old adage “trust but verify” is the approach we hope to cultivate in this industry. We work hard to earn trust, but we also invite intense verification of all of our processes by investors and other stakeholders.
Most farmland sales happen in private transactions, requiring extensive connections in local land markets to gain access to deals. The fact that our company is “out here”—based in Arkansas as opposed to Wall Street or Silicon Valley—is certainly a benefit when speaking to farmers and landowners, but perhaps more significant are our efforts to continuously expand our network.
In the first quarter of 2021 alone, our team had over 1,000 calls directly with farmers and landowners. Our intense focus on farming communities is a powerful driver of investment opportunities for review. We don’t believe there is a land investment company in the world that comes close to our outreach efforts for sourcing.
To personalize this even more, we develop strong relationships with our farmer partners; we frequently text each other about land, home improvement projects, or even just pictures of planting progress. We are strongly committed to creating long-term relationships with as many hard-working individuals as possible. Ultimately, we need both sides of any transaction to do well. The farmers with whom we work are a very important part of that equation.
Our company is backed by industry-leading venture capital investors, including RZC Investments, Jump Capital, Narya Capital, Revolution’s Rise of the Rest Seed Fund, and Revel Partners. We have raised upwards of $18 million in venture capital, and we maintain the majority of this capital today in reserves. We have a sound, long-term-focused business model that doesn’t fit the Silicon Valley mold of “growth at all costs.”
Compliance is another major component of our lasting stability. The first line in our company’s core values statement is “be in business tomorrow.” It seems simple, but we are surprised at just how many companies choose short-term business outcomes that increase risk for their various stakeholders. Perhaps this is why, as a small company, in addition to four separate outside legal firms that we regularly work with, we have two full-time attorneys on staff.
As an example of compliance, our investment process can be challenging for some during the accreditation process. We do not take shortcuts, we verify everyone, and we have not accepted non-U.S. investors or entities to date due to potential legal and compliance complications that require further vetting. The reason is simple: if we cut corners, there can be increased risks to every investor in the offering.
In short, maintaining our leadership in the growing industry of farmland investing entirely depends on our stringent diligence, not just in deal sourcing, but in every aspect of our business. We make sure the trust investors place in us is well-founded. We are committed to building a transparent market, not just within AcreTrader but within the industry as a whole.