For farmers ready to adopt more sustainable practices, whether it’s organic, biodynamic, no-till, solar-powered, or grass-fed, it can be a struggle to find the right loan or federal grant to support this pivot. What’s more, loan applications are often complex and lengthy.
With the daily interruptions of farm life—a sick calf, a fence down, a hailstorm threatening—it’s easy to see how a process that, at best, can take three hours to complete, could stretch across days, or be abandoned altogether.
FarmRaise is a startup that automates this process of matching farmer to financing, drilling down the whole application process to a mere 17 minutes. By revitalizing the small and mid-sized farms that comprise over 90 percent of American farms, the venture hopes to sow a brighter future for us all.
“Improving financial access to scaling up regenerative, profitable farms is this amazing business opportunity, but also this amazing mission worth dedicating our lives to solving,” says Jayce Hafner, cofounder and CEO of FarmRaise.
Putting down roots
The three cofounders of FarmRaise have braided together their life experiences and technical expertise into a quickly growing enterprise.
Jayce Hafner, MS/MBA ’19, is a farmer’s daughter who grew up raising cattle, goats, and chickens in Virginia’s Shenandoah Valley.
Sami Tellatin, MS/MBA ’20, is an environmental engineer from Missouri who worked at the U.S. Department of Agriculture for three years before returning to school.
They kept hearing about each other as they separately navigated Stanford Graduate School of Business and different master of science courses, but they didn’t meet until 2019, when their research coincidentally crossed paths at Land O’Lakes, where Tellatin was an intern.
“It’s really rare to meet people in the business school who are interested in the upstream aspects of food and agriculture—the actual farming part of it,” says Hafner.
Excitedly, they compared notes. Tellatin was talking with big row-crop farmers in the Midwest, while Hafner had interviewed ranchers in California’s Central Valley, yet they were hearing the same sentiment over and over. Farmers didn’t know how to navigate applying for the best types of finance in order to transition to regenerative agriculture.
“They basically were asking us to build a TurboTax for farmers,” says Hafner. “Looking at the market and at what farmers were telling us, that’s when we knew we had to get started—like, immediately.”
In March 2020, Hafner signed on as CEO and Tellatin as COO, but neither one had a background in computer science, so they knew they needed a third cofounder—“our missing person”— to drive the engineering to build the platform.
Albert Abedi is a software engineer from Georgia who jumped at the chance to pivot from cybersecurity to championing farmers. He joined the team as head of product in August 2020, and has helped the venture to acquire nearly 800 paying customers and more than 10,000 free account holders since FarmRaise launched its paid services in January 2021.
Because FarmRaise took root just as the pandemic was emerging, today the team is fully remote with 14 full-time employees spread across major farming hubs in the United States. Building a startup culture for a geographically disparate team hasn’t always been simple, but it helped the cofounders to clarify their values early on and instill those throughout the company.
“We are really committed to diversity at FarmRaise directly, and then bringing that to the farming community, writ large,” says Hafner, of an industry that identifies as being more than 95 percent white and 64 percent male, as of 2017.
“So many young, underrepresented farmers are breaking onto the scene, and we are here to support them and are excited to be part of that change.”
Digging for pay dirt
Farmers can have a reputation for being slower to adopt budding technologies. Their cash flow is cyclical, and big purchases must be timed carefully. So, when Hafner and Tellatin first began seeking venture backing for their startup, they met skepticism from mentors in the investment community. Could they sell to a meaningful segment of the 3.4 million farmers in the United States? Would farmers even use a digital tool to share sensitive data?
“Everyone we talked to said, ‘You should bootstrap this and make it a nice, small, regionally focused business.’ Or they would say, ‘Be a nonprofit and focus on one state,’” Hafner recalls. “These are all viable options, but our vision for scaling soil health across the United States needed to align with a business model that could scale.”
She says a turning point was meeting Brian Bartholomeusz, executive director of innovation transfer at the TomKat Center for Sustainable Energy.
“Just having one person say yes, early on, and give that emotional support before there was a financial investment, was huge.”
With his encouragement, the cofounders applied for an Innovation Transfer Grant that allowed them to test their services with prospective customers and, as it turns out, debunk some myths about farmers.
FarmRaise went on to secure $2.2 million in venture capital in 2020 and another $7.2 million in 2022. Last year, the startup also formed partnerships with Corteva and Cargill, the largest agribusiness in the world, looking to reduce the carbon footprint of their farmer supply chains.
Rather than offsetting carbon, these agriculture companies are experimenting with what is called “insetting carbon,” asking their farmers to directly lower emissions and hiring FarmRaise to help guide and track their progress. Soil health is a big part of the process.
Innovative funders are already beginning to explore the connections between climate, dirt, and bottom lines. Carbon markets are beginning to take shape in the United States, where farmers are rewarded for sequestering greenhouse gas emissions. One lender, rePlant Capital, even ties interest rates for farm loans to soil health as a metric for how risky an investment might be. (Credit check? Yes. Soil check? That, too.)
Hafner points to her own family farm in Virginia by way of example. When her father switched to managed grazing, a method that guides cattle over pastures in an intentional way, it led to a $40/acre boost in profitability and the flourishing of wildlife and water quality.
Eventually, FarmRaise aims to become a full-service financial partner for farmers, advising on loans to get started, banking and taxes, negotiating group rates for equipment and seeds, and even legacy planning.
“I think about my own experience, and the experience of millions of other young people who grew up on farms, who just didn’t see a path forward for a thriving farm business. We lacked tools. We lacked connections,” she says.
Attracting younger farmers into the fields and pastures is becoming more urgent. American farmers are getting older. According to the 2017 Census of Agriculture, the most recent data available, the average age of a U.S. farm producer is 57.5 years old. As the current generation of farmers retire, younger ones will need to carry the responsibility of both national food security and a chance to change social and environmental paradigms.
“The power of FarmRaise is how this platform can enable farmers to chart their future as small business owners with clarity,” says Hafner. “With that path, I’m confident we can get young talent back into the farming sector. What we need is a tool for that, and that’s what we’re building.”