0 (2s):
Boom, shake the room, Fire Nation, JLD here. And welcome to Entrepreneurs On Fire brought to you by the HubSpot Podcast Network with great shows like my first million stories about companies that grew from nothing into legit businesses today, we'll be focusing on impact and income building the first sustainable farmland investing company to drop these value bonds. I brought Artem Milinchuk on the mic. He has over 10 years of finance experience in food, agriculture and farm lands prior to founding farm together. Artem was a #1 employee and CFO/VP of Operations at Full Harvest Technologies. He previously worked at Ontario Teachers' Pension Plan and holds an MBA from the Wharton Fire Nation, today, we'll be talking about why would one want to invest in farm lands?

0 (54s):
What is farmland investing exactly. And how does farm together work? The impact, the income that this will have on the world as a whole, and so much more when we get back from thanking our sponsors, customers want more from brands delivering more means owning the customer experience, taking control over data acquisition analysis, creative and delivery. Klaviyo calls this owned marketing, and they believe it's the best path to growth for more visit cleevio.com/fire. That's K L a V I Y O.com/fire. The HubSpot Podcast Network is the audio destination for business professionals who seek the best education and inspiration on how to grow a business. Whether you're looking for marketing sales service, or operational guidance, the HubSpot Podcast Network hosts have your back, listen, learn and grow with the HubSpot Podcast Network at hubspot.com/podcastnetwork.

0 (1m 43s):
Artem say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with.

1 (1m 53s):
Yeah. So John, I would say it's flexibility. I think a lot of people agree with things like you need to persevere. You need to be relentless. You need to be smart, you need to execute. And all those things are very much true. But I think if you, in, in, in that pursuit, people forget that they need to really kind of be very nimble. And the thing about doing a startup is that you have no idea kind of what people truly want to truly care about. So you need to like really be receptive and very flexible as well. And I think that oftentimes gets missed in this, like beating your chest, you know, success at all costs, you know, no matter what keep going. And so people glaze over that and I think that's really important

0 (2m 35s):
Abilities, huge Fire Nation. That's why I always encourage people to ask their audience, what is your biggest struggle right now? And listen to their biggest struggles. And then you provide the solution and immediate to be flexible on that because you don't know what they're going to say, and that's how you can win. And as I talked about during the introduction, our town, we're talking all about impact and income today about building the first sustainable farmland investing company. So this is a very unique topic, but very important to talk about because why the heck Artem? Would anybody want to invest in farmlands?

1 (3m 10s):
Yeah, that's a, that's a great, somewhat loaded question because I kind of want to turn it back to you and say like, why would anyone think about investing into anything but fun?

0 (3m 20s):
I like it. Tell me more because

1 (3m 22s):
When, when you think about it, you know, farming and farming is the oldest asset class, our whole civilization, right? We, as people have emerged once agriculture emerged. And so when you're building a portfolio that needs to represent the actual underlying reality, I know sometimes we forget that finance is supposed to represent, you know, the real world. The first thing to comes to mind is food and water. And that's what Pharma is. So really it's the bedrock of civilization. We think it should be the bedroom, kind of the number one addition to people's portfolios,

0 (3m 53s):
Rock Fire Nation, the absolute bedrock. And I liked that kind of multi-use of the word. And we're going to be talking more about exactly what that impact looks like and what the income could be looking like in the investors' pockets. But first off, what exactly is farmland investing look like let's get specific on this. And then how does farm together actually work?

1 (4m 17s):
Absolutely. So farmland investing is very much a real estate investing, but it does have some unique qualities. Real estate investing means that when you buy a property, you typically expect it's priced to appreciate either through just longterm trends or through improvements. And then you expect some sort of income from a rental income or some other revenue streams. And Pharma is very similar. So something that a lot of people don't know is that 40% of farmland today is rented already. So farmers are very comfortable renting and renting out land. When you invest in farmland, you buy a piece of an existing farm that farmers typically rented out or contracted out to an experienced farmer.

1 (4m 60s):
And you as an investor receive cash flows from that land and participate in price appreciation and Pharma has appreciated by almost 6% in the last 50 years annually

0 (5m 12s):
Fire Nation. These are the kinds of numbers and the type of opportunities you need to be thinking to be outside of the box, because that's kind of my next question. Artem is how exactly does this? And by this, I mean, farmlands compared to traditional investments, we we're talking like stocks and bonds, which should be kind of considered the more traditional investments that you know, of course these days with things like game stock and all these other crazy things going on in the world, our stocks are really that traditional, like who knows what the future is going to hold, but how does farmland compare?

1 (5m 43s):
Absolutely. And when we talk about returns, we also want to talk about risk. So investing is it's two-sided coin since 1992, farmland has delivered on average annual total returns, which is price appreciation plus income of more than 10% annually. And that actually compares really favorably with stocks, with bonds, even with real estate, with infrastructure timber, the asset classes out pharma actually outperformed almost all of them. And then on a risk basis, which, you know, another way to think about is volatility. Farmland volatility is only about 7% in that period, which was much better than stocks and very comparable to real estate and bonds.

0 (6m 23s):
So listen, we have a lot that I want to get to after we take a little break here, but before we do, I mean, let's really kind of dive more into how farm together works. Like what is farm together? How does it specifically work? Like any examples you can give to kind of, you know, help myself and Fire Nation really understand this process?

1 (6m 42s):
Yeah, absolutely. So fun together is a platform that makes it easy for people to invest in pharma because unlike stocks, unlike bonds, unlike crypto, there's actually very few vehicles for people to get exposure, to invest in this asset class. So its online platform right now it's mostly credited investors, but we are working towards making it accessible to non-accredited investors as well. And the way it works is that we have an in-house pharma investment team that looks through hundreds, thousands of opportunities select the best ones and then buys the land outright. And the reason that the land is typically for sale is due to a very tectonic shift in ownership happening, farmers are approaching age of 60.

1 (7m 24s):
They're all retiring kids don't want to farm. So lot of land is actually coming to the market anyway. So we're just acting as another buyer. Then we find another far more farming family to farm it. And then that farm is put into a separate vehicle at Delaware, LLC. And then we put a package around it explaining why we think it's a good deal. We put it online on the platform, use an investor, go online. You read through the materials, very simple, easy to understand. You can listen to webinar and ask questions and then you can go online and invest in a matter of minutes through integrations with your online signing platforms with the banks. So you can literally become a farmer owner of, you know, an almond orchard in California and in three minutes

0 (8m 6s):
And almond orchard in California. I mean I eat almost every day. I would kind of be cool knowing that I wasn't eating almonds. I'm like maybe I'm eating my own almonds from my own investments. And I love how you just use the phrases, bedrock Teutonic shift. I mean, you've really committed Artem to this whole idea of land farm land, the world that we live on the ground beneath our feet and foundation, we'll be talking about some more specifics along these lines. When we get back from thanking our sponsors, the CRM you choose to help you run, grow and scale your business is important and what's even more important is that you get your team on board with using it with HubSpot CRM platform. You can trust that adoption will be easy.

0 (8m 48s):
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0 (9m 36s):
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0 (10m 21s):
So learn more about how Klaviyo helps you own your growth visit Klaviyo.com/fire. That's K L A V I Y O.com/fire our and we're back. And let's get real about how farmland can fit into the universe with other assets, with other alternatives we're talking traditional real estate, or maybe even like real assets like gold, silver, et cetera, break this down for us.

1 (10m 46s):
I like that you use the word alternatives because that's actually one of the defining trends of investing in 21st century. The traditional stocks and bonds have been, you know, over overboard a little bit, I would say. But most of that, there is a lot of other asset classes that are uncorrelated. And so people are really looking to get into alternatives, real estate, farmland, art, crypto, exotic cars, you know, you name it. And so farmland, I think when we look at the sort of portfolio composition and need to get a little technical, a new full look at, you know, the what's called the sharp ratio, the risk to return over, look at the total contribution to the portfolio. Then adding farmland to your portfolio increases that sharp ratio, meaning the returns to risk or the way that farmland improves your kind of total portfolio composition.

1 (11m 37s):
We're not arguing that you should replace your whole portfolio with farmland, with distill things, stocks and bonds should be kind of the core of your portfolio, but adding alternatives can really sort of introduce that uncorrelated nature to your portfolio. Well, as enhance returns, Pharma is also great PR protect against inflation has done really well in periods of high inflation and in periods of recession. So we think it kind of, you know, fits in almost any one.

0 (12m 7s):
And I really want to hone in on the words, uncorrelated investments, Fire Nation. I mean he mentioned exotic cars. He mentioned, I mean, well he didn't mention, but I'll mentioned shoes, Pokemon. I mean, these are all like, you know, kind of crazy things that people are investing in now because maybe they, they love it or they have a passion for it and want to really dive deep into it. And this is like another example of an uncorrelated investment. So your whole portfolio, doesn't just all go up together. You know, when everything's going great, like in the quote unquote stock market, and then I'll crash together when the stock market inevitably crashes, because of course, you know, we have the ups and the downs and the recessions in the, you know, even depressions that all are going to be part of our futures. That's just the world that we live. And if we live long enough, so uncorrelated investments can be super meaningful.

0 (12m 51s):
And you recently had a partnership signing with leading harvest as well as some others. So talk about that partnership, what it means and wifi, our nation needs to know about it.

1 (13m 2s):
The leading harvest is a new standard that was created last year, and it is a sustainability standard for investing in and managing farmland. When you think about farmland and farming overall, it actually touches on so many key themes around sustainability and broadly that you went sustainable development goals, which is kind of the overarching global framework that, you know, companies that want to do good in this space follow. And those goals are very simple things like decrease hunger, improve the quality of our food, improve the quality of water, things like that. And so the, the leading harvest standard is a third party verifiable auditable standard that is very action oriented and very measurable.

1 (13m 44s):
So it's a number of metrics such as have we started using less fertilizer to grow the same amount of food. Have we started using water more efficiently to really measure ourselves the industry on how well we, we use farmland? And so we excited to join that that standard is one are kind of the first, you know, emerging growing online platforms and investment companies. Most of the players that are really big, the kind of the, some of the largest players in the space. So we're excited to be there and to also help them democratize that standard as well, just like we're democratizing access to farmland.

0 (14m 20s):
And that's what it's all about. Fire Nation, it's all about coming together and improving everything we do. I mean, wow, if we can like, you know, decrease the amount of toxins that are being used, you know, to grow our foods, et cetera, and just have better standards and democratizing things, it's going to be better for everybody. And that's kind of how I want to bring this home our time. I want to talk about impact. I want to talk about income, how is what you are doing, going to actually benefit both investors pockets and just the world as a whole.

1 (14m 47s):
Yeah, that's a great question. So first I will say that a lot of people know this, but we actually losing farmland every year in the United States alone, we lost about 15 million acres from 2012 to 2017, which, you know, to put it in perspective as twice the size of the state of Massachusetts, furthermore, we, especially around the world, people actually clearing forests and burning them for very low intensity agriculture because we need more and more food and we need to actually grow double the amount of food that we grew in 2009 to feed the increasing population. And how do you do this at the same time? You know, without further impacting climate change for the kind of using up more resources and more land.

1 (15m 31s):
And, you know, part of the answer to that is, is smart and sustainable agriculture. So when you invest with us, every farm that we have will be on the leading harvest standards, we actually committed a hundred percent of our farms to that standard. And that alone, I think should, should make you feel really good that we'll never do wrong by the lad or by the farmers as well, which is really the most important part of this equation. I would argue, secondly, the, right now, the farmland industry and farming overall, it's a little bit behind areas like real estate, like other other industries where finance is much more developed in, in farming. There's not enough creative capital solutions.

1 (16m 13s):
So for farmers looking to transition to organic or regenerative agriculture, you can't just go to bank and get it alone. Like you do, you know, to buy a house. And so more and more of our investments and our partners are structured around that. Either transition or expansion of, you know, great farmers that are looking to expand their business. So really when you invest with us, you're helping farming families, farming, entrepreneurs expand, you know, cutting edge agriculture. We talk in drones, we talk in regenerative, we're talking new varieties and we just close to deal with Stemilt, which is the second largest Apple grower in the United States that introduced this new Apple variety called cosmic crisp.

1 (16m 55s):
And that the cosmic crisp uses also this coding that essentially is prolonged the shelf life of the Apple without impacting, you know, the taste or the quality of it. So it means you're less food waste as well. So we're really excited to have those kinds of partnerships.

0 (17m 12s):
I mean, foundation of this is the kind of stuff that excites you because this is the kind of world that you want to have a hand in creating. These are the types of investments you can make. And again, our team is not saying, Hey, put your entire 401k into this because he thinks you should have a well-balanced portfolio, but that's the point. This is potentially part of a well-balanced portfolio. And especially one that you can feel good about because of all these fantastic things that they're doing. So Artem bring this home for us. What is the one thing you really want to make sure Fire Nation gets from everything that we talked about here today? How can we connect with you more to learn more about everything that you have going on and maybe become a part of what have going on and then we'll say goodbye.

1 (17m 51s):
Absolutely. So one, I think that investing in pharma is investing into the planet, investing into the future, but at the same time it's investing into what is, you know, a one kind of unchangeable thing about our lives. We need to eat and we need to drink water. Secondly, when you invest in farmland, especially in, in sustainable kind of farms, you're doing better for the planet and for the farmers and it's, it's good returns, it's low volatility, low correlation. And the way to kind of learn more about it is to go to farm together.com. We have a lot of great educational materials, white papers, one-on-ones webinars, sign up, follow deals.

1 (18m 32s):
We do webinars, and you can ask a lot of questions before you feel comfortable investing. Once you feel comfortable, you know, take the plunge and sort of follow your investment. And I think you'll learn even more. We're looking to introduce annual and quarterly reporting reports from the field. If we can afford it logistically you have, and we'll be able to actually receive those California elements every year,

0 (18m 55s):
So Fire Nation, come on. This is some cool stuff. I mean, you can invest in almonds and you can eat the almonds even invested in and you know, you're making the world a better place. And you also know that you're the average of the five people you spend the most time with. You've been hanging out with AR and JLD today. So let's keep up that heat and head over to EOFire.com type ARTEM in the search bar has shown his page will pop up with everything we've been talking about here today. Best show nose in the biz. And again, your direct call to action. If you want to learn more Fire Nation farm together.com our 10, thank you for sharing your truth, your knowledge, your value with Fire Nation today, for that, we salute you and we'll catch you on the flip side.

0 (19m 38s):
Thank you so much, John. Hey, Fire Nation today's value bomb content was brought to you by our term ends. One thing that I've identified over the years, successful entrepreneurs are disciplined, are productive, are focused, which is why I created the mastery journal. It is a gorgeous, full other journal that will ensure that you master a productivity, discipline and focus in 100 days. It is one of my best works ever visit the MasteryJournal.com use promo code podcast, free $15 discounts. And thank you for listening to my podcasts and I'll catch you there, or I'll catch you on the flip side. Customers want more from brands delivering more means owning the customer experience, taking control over data acquisition analysis, creative and delivery, Klaviyo calls, this owned marketing, and they believe it's the best path to growth for more visit Klaviyo.com/fire.

0 (20m 28s):
That's K L A V I Y O.com/fire. The HubSpot Podcast Network is the audio destination for business professionals who seek the best education and inspiration on how to grow a business. Whether you're looking for marketing sales, service, or operational guidance, the HubSpot Podcast Network hosts have your back, listen, learn and grow with the HubSpot Podcast Network at hubspot.com/podcastnetwork.