Soil Trust: FAQ
How it works
- Why a donation rather than an investment?
- How is the Soil Trust different from other crowd funding platforms?
- Why is the Soil Trust needed?
- What is the Soil Trust?
- What is the mission of the SOIL Trust?
- What does the Soil Trust invest in?
- Who makes the investment decisions for the Soil Trust?
- What are the Soil Trust investment criteria?
- What type of investment instruments will the Soil Trust use?
- Will the Soil Trust make any grants?
- Can my project get funded by the Soil Trust?
- Is my donation to the Soil Trust tax-deductible?
- How will I know which enterprises get funded?
Why a donation rather than an investment?
Taking in donations rather than investments allows the Soil Trust, a non-profit fund, to do what traditional investment funds cannot do – focus entirely on generating positive social and environmental outcomes with its investments.
If you believe that the time has come to put back into the soil more than we take out, then it’s time for new types of funding, like the Soil Trust, the first grassroots fund of its kind dedicated to rebuilding local food systems in the US.
If, however you would like to make direct investments in food and farming enterprises rather than make a donation, please join a Slow Money group close to where you live. Here are some of the recent investments made by Slow Money groups around the country. If you are looking for investment funds here is a list of funds aligned with our values. If your philanthropic budget allows, please consider a donation to the Soil Trust.
How is the Soil Trust different from other crowd funding platforms?
The Soil Trust is different from other crowd funding platforms in four important ways.
First, unlike most crowd funding platforms, through which individual enterprises connect directly with individual investors or donors in an isolated transaction, the Soil Trust deploys its capital in collaboration with a network of local investors who are leading the way with first-hand local knowledge.
Second, the Soil Trust adds to the knowledge of local investors the experience of a national management team, which includes successful investors and financial activists who have decades of experience both in philanthropy and socially responsible investing.
Third, by recapturing its investment returns and reinvesting them, the Soil Trust creates a long-term, virtuous cycle, multiplying social and environmental benefits.
Fourth, the Soil Trust is part of a movement—an emerging community of activists, farmers, entrepreneurs, investors and others who have a strong shared vision, as expressed in the Slow Money Principles.
Why is the Soil Trust needed?
Over many decades our institutions, financial system and consumer behavior have encouraged the industrialization of agriculture. Among many unintended consequences, this focus on increasing the production of agricultural commodities has caused many negative long term impacts, including soil erosion, aquifer depletion, loss of biodiversity, toxics in the food chain and loss of community vitality.
We have seen government provide subsidies, tax breaks and bailouts to large corporations and Wall Street at the same time as local farm and food businesses have struggled to obtain credit, from the same banks, to stay in business.
We are able, at the click of a mouse, to send our money around the world, at lightning speed. The result? We are giving our money to investment managers we don’t know very well, to invest in things they don’t understand fully, half-way around the world in places that most of us will never visit. Many of us suspect that this is no longer a recipe for a healthy future.
In an exciting new approach, Slow Money investors are putting their money directly into small food enterprises, often a few thousand dollars at a time, sometimes a few tens of thousands of dollars at a time. A smaller number of investments are in the hundreds of thousands of dollars, and a very few in the millions of dollars. The totals are over $20 million into more than 170 food enterprises since mid-2010.
Now, you can become part of the solution. The Soil Trust is an opportunity to donate into a pool of capital that will strategically amplify its impact by working alongside investors who have local knowledge and local relationships.
Unlike a typical crowdfunding platform, where individual enterprises connect directly with individual investors or donors in an isolated transaction, the Soil Trust builds shared long-term value by recapturing the returns to be reinvested—creating a long-term, virtuous cycle with multiple social and environmental benefits.
What is the Soil Trust?
The Soil Trust, an initiative of Slow Money, is a non-profit fund that gathers tax-deductible donations and invests the capital alongside Slow Money investors around the country. The Soil Trust is dedicated to rebuilding regional and local food systems around the country, with the ultimate goal of increasing soil fertility, local economic vitality, food security and food access.
The money will be invested primarily in enterprises featured at national and regional Slow Money showcases in collaboration with Slow Money’s emerging network, utilizing its knowledge of place and the investment expertise of our management team. As of the fall 2012, Slow Money has 15 local chapters, six investment clubs and a dozen or more other communities where small groups of folks are beginning to collaborate.
Contributors to the Soil Trust receive a tax deduction for their donation. Returns from the investments will stay in the Soil Trust to be reinvested, building a long-term, non-profit fund that can build the soil of a restorative economy.
What is the mission of the SOIL Trust?
The mission of the Soil Trust is to provide patient investment capital to rebuild regional and local food systems around the country by supporting and funding strategically important systemic foodshed projects with the ultimate goal of increasing soil fertility, local economic vitality and food access.
This mission is pursued consistent with the Slow Money Principles.
What does the Soil Trust invest in?
The Soil Trust identifies potential investments in collaboration with the national Slow Money network of investors and activists around the country. Most of the investments made by the Soil Trust, at least initially, will be in enterprises featured at national and regional Slow Money entrepreneur showcases. The next such showcase will take place during the upcoming Slow Money national conference in Boulder, CO in April 2013.
The enterprises that presented at the most recent Slow Money national entrepreneur showcase include local food restaurants, grain mills, vegetable processors, local distributors, compost companies, grass fed beef operations, fruit producers, hog farmers, non-antibiotic therapies for dairy cattle, inner city food markets and many other innovative private enterprises that are building the local, organic food systems of the future.
The 15 Slow Money chapters and the dozen active Slow Money groups around the country, identify food and farming enterprises in their region. Investing at the local level occurs in a variety of ways, including peer-to-peer loans and local entrepreneur showcases—events at which entrepreneurs make presentations to groups of local investors. An overview of Slow Money activity around the country is available here.
Slow Money’s national staff, based in Boulder, CO, in collaboration with a group of advisers and investors from the Slow Money network, selects a few dozen enterprises to be featured at the entrepreneur showcase at Slow Money’s national conference. At the last national gathering, 850 people from 35 states and several foreign countries attended, including many widely recognized leaders in sustainable agriculture and investing.
Who makes the investment decisions for the Soil Trust?
Investment decisions will be made by Woody Tasch, with the assistance of an Investment Committee consisting of Marco Vangelisti, Kristin Martinez, Esther Park and Andy Wallerstein. See team page for bios.
What are the Soil Trust investment criteria?
In evaluating potential Soil Trust investments, we will consider such factors as:
- the systemic social and environmental impact of the enterprise
- the quality, experience and commitment of the management team
- the level of support, both financial and technical, from local Slow Money investors
- employee ownership
- access to other forms of capital
- particular impacts on soil fertility
- food access for underserved populations
What type of investment instruments will the Soil Trust use?
The Soil Trust will be as flexible as possible, using a wide variety of instruments, including loans, equity, royalties and guarantees.
Will the Soil Trust make any grants?
The Soil Trust’s objective is to make investments in for-profit businesses. However, we recognize that some enterprises will require creative deployment of both grants and investments to fund various aspects of their development. Grant making will therefore be a component of the Soil Trust capital deployment, but we expect grants to comprise no more than 10% of the Trust’s funding decisions. In addition, the Soil Trust will donate 5% of its annual inflows to support the Slow Money organization, in recognition of the role it plays in building the movement and the investor network, on which the Soil Trust depends for both the sourcing of its funds and the early selection of potential investment opportunities.
Can my project get funded by the Soil Trust?
The main path to be considered for an investment by the Soil Trust is presenting at the entrepreneur showcase at the next Slow Money national conference in April 2013 in Boulder, CO. Therefore, the first step for an entrepreneur is to get in contact with the nearest Slow Money chapter or group and network with potential Slow Money champions that might promote the entrepreneur as a candidate for the national showcase.
Is my donation to the Soil Trust tax-deductible?
The Soil Trust is an initiative of Slow Money, a 501(c)3 non-profit. Donations to the Soil Trust are made as a tax-deductible contribution to Slow Money, specifying the Soil Trust as the recipient of the funds.
How will I know which enterprises get funded?
The Soil Trust will post its investment activities online and will publish an annual report, detailing all investment decisions. Additionally, the Slow Money Letter, the newsletter of the Slow Money network, will also include updates on Soil Trust activity. You will automatically receive the Slow Money letter when you make a donation to the Soil Trust.