Rob LeClerc has the kind of pedigree that investors tend to like. He holds a master’s degree in computer science from the University of Calgary and a doctorate in computer biology from Yale. In fact, ten years ago, what he really wanted to do with his degree was find and fund agriculture-related projects that address climate change.
But ten years ago, “agritech” was still not a category, and that was the problem when it came to convincing investors of the concept of a hedge fund that LeClerc would run with partner Michael Dean , with whom LeClerc previously ran an agribusiness. West Africa for several years.
At the time, there were “a handful of businesses” involved in agritech that investors were aware of, LeCllerc said. Think Climate Corp and Impossible Foods and smart machinery company Blue River. But Climate Corp has not yet sold it to Monsanto to 1 million dollar. Impossible foods are not valued in billions of dollars, like nowadays. And Blue River is still a long way from being able to sell $ 305 million to John Deere. LeClerc recalls: “The overarching issue was the narrative. “People don’t care about it.”
They may have just given up; Instead, they decided to start a content company called News AgFunder. “We thought we could get people excited with food and [agriculture]maybe we’ll be in a position to [raise a fund later]’ said LeClerc. It’s also a smart bet. After posting more than 4,000 articles to the site and attracting 90,000 subscribers to the site’s weekly newsletter, LeCllerc said. AgFunderHis investment team – which includes Dean and two recent additions – has just closed a $60 million capital commitment for a fund they expect to hit $100 million in the next few months if things go right. Go.
That’s a big step up from previous funds LeClerc and company started raising a few years ago – mostly from people reading the newsletter. “First we raised $2.5 million worth of friends and family,” he said, “then 5 months later we needed more money, so we raised $2 million.” , then 6 months later we raised $5 million.” And such. “It’s not the most conventional way to raise funds, but AgFunder has a ‘huge subscriber base,’” and ultimately the belief that we know what we’re doing and can spot it, says LeClerc. companies have started a lot of conversations that we wouldn’t have otherwise. It has become a structural advantage.”
This strategy is not unprecedented. LeClerc cites his inspiration as TechCrunch founder Michael Arrington, who built his brand on entrepreneurship, then used the power of that brand to launch an investment career. Meanwhile, Arrington has been forged in his way by investor Jason Calacanis, who previously founded a media company, and more recent examples are starting to appear regularly. Among them: Londoner Harry Stebbings used his podcast “Twenty Minute VC” as a springboard into the world of adventure last year, and Nik Milanović, author of a two-year-old newsletter called “This Week in the Week” Fintech”, in January launched a investment syndication called Fintech Fund.
However, newsletter subscribers – no matter how deep their pockets – should not invest tens of millions of dollars in a team without seeing some results first, and AgFunder has There are some things to brag about. Indeed, some of the 60 companies that have received checks from the group so far include automated tractor startup Bear Flag Robotics, which was sold to John Deere last year for 250 million dollars; Root AI, a startup developing a harvesting robot for indoor farms and acquired by AppHarvest for 60 million dollars last year; and Greenlight Biosciences, a biotechnology company focused on RNA research went public last month by merging with a special purpose acquisition company.
If you’re curious about how many companies own in each of these, keep guessing. AgFunder — which tends to write checks for $500,000 as a starting point but also writes checks for $3 million — isn’t thinking about ownership goals or looking for a specific percentage of ownership in a company, LeClerc asserts. While his team has used special purpose vehicles to maintain their share in a number of companies, including a still-private molecular coffee company called Atomo Coffee, he said he was not “suspended in possession. For me, the question is, ‘Will this investment return the fund or a multiple of the fund?’ If you get hung up on ownership, you could miss out on opportunities.”