Case Study: Steward
Location: USA based, expanding globally
Investment type: Crowdlending, impact investment and philanthropic
Founded in 2016, Steward is a mission-driven lender partnering with regenerative farms and agriculture businesses to transform local food systems.
Steward is working to meet the critical finance gap facing regenerative businesses by encouraging new capital into the market. The platform aggregates funds raised online from a diverse network that purchase loan participations - a recognized commercial lending structure that gives multiple parties the opportunity to be part of a larger loan, pro-rata and pari-passu. This means that individual lenders effectively buy a slice of the loan that Steward is making.
The process works as follows:
- Farmers apply for the capital required
- Steward vets the farm and business.
- Steward then goes through the process of credit underwriting and putting the loan up on their online platform.
- A portion of every loan gets funded through the network of the farmer, providing ‘social validation’ and assurance to the Steward team that there is a community of support around the grower.
Loan sizes range from as small as US$10,000, with the average loan for equipment and infrastructure around US$50,00-$250,000. They have financed over 90 different loans to date and are now closing deals in the US$5million to US$10 million range - and growing.
The company works with all farming and ranching business types from livestock to dairy to horticulture to vineyards, with finance needs ranging from land acquisition, infrastructure and equipment to operating capital.
When we spoke with Dan Miller, founder and CEO of Steward, he told us that about 70% of their loans are referrals, and that's coming from the network of relationships the company has developed with farmers over the past 6 years.
"It's still about human relationships for us. Yes, we work through online platforms but we are not about ag tech and automation.
It took us 3 to 4 years to set everything up, we now have projects every week raising money, we're doubling our finance volume every few months and seeing huge demand on both sides.”
Steward has a set of values that lenders need to align with including:
- Regenerative
- Human-scale -operations that engage more hands on the land
- Appropriate - 'right sized and suitable for the community, location or operation’
- Equitable -supporting underserved groups/empowering communities.
This case study is an extract from Regenerating Investment in Food and Farming: A Roadmap.