In the News: Our Director Talks Crowdfunding for Small Farms

You’ve heard of crowdfunding, but have you heard of crowdfarming? 

The sheer amount of capital needed to purchase and operate a farm can be a limiting factor for farmers of all sizes. Small farms are especially at a disadvantage for funding as they are usually unable to access the subsidized loans provided by the U.S. Government for farms producing commodity crops.

Our program director, Anu Rangarajan, was recently interviewed about funding access for small farms.  

“It’s pretty well established that funding is a real issue these days given that land values have gone up a lot and then having operating capital is also a challenge,” Rangarajan told Civil Eats. 

She also mentioned that accessing capital is especially challenging for farmers who did not inherit land, and there are often demographic factors that contribute toward a lack of funding.

To bridge the gap between farmers and access to funding, crowdfarming companies like Steward provide an alternative method of funding for small and beginning farmers. They connect investors and farmers through flexible loans. 

Worried about the high interest rates on private loans from these companies, Rangarajan said: “The margins on a farm are so low, so if you do have a crop loss, that could be an issue, people defaulting on loans because of a loss.”

Companies like Steward plan that their tailored approaches make it possible for farmers to repay the loans, even at a higher interest rate compared to the loans available to larger farms. 

Read more about ventures to fund small farms and success stories of the crowdfarming model in the Civil Eats article.