Last Week, Federal Agriculture Minister Marie-Claude Bibeau announced more funding to help ag-related businesses deal with the impacts of COVID-19.
The new $100 million Agriculture and Food Business Solutions Fund will be overseen by Forage Capital Inc out of Calgary and paid out through Farm Credit Canada (FCC).
“The idea behind this fund is to help businesses in the food industry; could be primary production, agri-tech, manufacturing, packaging, and distribution. So, all the businesses working around the food supply chain are eligible. And it's for well-established companies who have a proven track record, but are facing a major business disruption.”
She says the fund will look at flexible financing solutions like convertible debt investments.
”It means that it's kind of a loan. But if the company has a hard time to repay, they can pay back with a piece of equity. This is you know, the type of loan that it's taking, let's say, a higher level of risk, and it could be very helpful for a company that’s facing a disruption, unexpected disruptions.”
She notes applications for the Business Solutions Fund will be assessed individually on their merit and will be supported to a maximum of $10 million.
In addition, FCC also recently invested more than $50 million into three new venture capital funds and provided funding to an innovation and growth accelerator to support various parts of Canada’s agriculture and food industry.
These recent investments include:
InvestEco Sustainable Food Fund – is a $100-million fund to invest in expansion-stage private companies with the goal of promoting health and sustainability in the food and agricultural sector. The fund manager offers expertise in sustainable agriculture and food production and believes these activities are important to environmental and health outcomes. InvestEco has previously invested in many leading food and agriculture brands across North America. FCC’s commitment to this fund is $20 million.
District Ventures Fund – is a $100-million fund that focuses solely on investing in companies operating in the food and beverage sector, health, wellness and beauty consumer goods categories. In addition to capital, District Ventures Capital provides recipient companies with marketing, programming and commercialization support. FCC’s commitment to this fund is $20 million.
Ag Capital Canada Fund – is a $24-million fund aimed at discovering, developing and nurturing Canadian agricultural businesses through capital investment and entrepreneurial expertise. The focus is on established businesses in need of growth capital and business management mentorship. FCC’s commitment is $12 million, which represents 50 per cent of the fund.
Bioenterprise – is a non-profit corporation established in 2000 to provide accelerator, mentorship and support services for entrepreneurs and innovative companies in Canada’s agribusiness and agri-food sector. Through its network of regional offices, Bioenterprise provides hands-on mentorship for innovative entrepreneurs and start-up companies. FCC committed $1.35 million in program support to facilitate expansion of Bioenterprises’ services to underserved areas across Canada.
“Our investments focus on promoting innovation and sustainability within Canada’s agriculture and food industry, supporting start-up to growth stage businesses, as well as filling the gaps in financing for underserved parts of our industry,” said Michael Hoffort, FCC president and CEO. “This is another way FCC can support entrepreneurs and promote innovation and success in this exciting and dynamic industry.”
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