A new way to buy more farmland - Successful Farming

It’s becoming increasingly common for farmers to compete with investors for land. A new company is seeking to turn competitors into partners. 

Fractal, a farmland equity financing company, intends to help U.S. row-crop farmers purchase new land by accessing the equity in the land they already own. Fractal will connect the farmer with an investor who will purchase a minority share, up to 45%, of their owned land for cash to assist in the purchase of new land. The farmer maintains majority ownership and total control of their land. 

"We strongly believe farmland investment can be a force for good by aligning farmers with capital," says Ben Gordon, CEO and co-founder of Fractal. "We believe farmers are best positioned to manage the land and that investors can drive the greatest impact and returns by supporting strong farm businesses."

Under Fractal’s financing plan, the farmer pays the investor an annually-adjusted fee for the partnership. Any time after two years, the farmer may choose to buy out the investor but Gordon says their hope is farmers see the value in maintaining the partnership as it frees up cash for other opportunities. Fractal is also offering a discount to farmers who choose to enact approved conservation practices. 

"Our customer is that farmer who is constantly tinkering, growing, and improving, and has these other opportunities and the desire to improve their farm," says Gordon.  

The company’s launch is following a testing period that raised $5 million in investments. 

"Having capital ready to buy the must-have farms that come across my desk is very intensive," says Kyle Mehmen of MBS Family Farms, a 5th generation family farming operation in northeast Iowa. "Many farms become available at an inopportune time. Access to equity capital gives us the flexibility to plan for growth to support the next generation, and Fractal has become a trusted tool to help me capitalize on land opportunities when they arise to ensure that growth."

Fractal is backed by Trailhead Capital, Serra Ventures, LLC, Groove Capital, and Virta Ventures and supported by industry partners such as UnCommon Farms.

Learn more by visiting the company's website or signing up for this upcoming informational webinar.

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A new way to buy more farmland - Successful Farming
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