Innovation

BLC has worked on projects ranging from urban agricultural and landscaping to local meat processing facilities. Each project represents a localized model for how to create net-positive impact and full-spectrum flourishing in our food systems by using a systemic perspective to create community level, long-term prosperity for both people and the local environment. By targeting systemic deficiencies at a local scale, BLC’s model of stewardship development advances UN SDG goals 8, 12 and 15 by increasing economic productivity in high-value-added and labor-intensive sectors, restoring ecosystems, and creating local food systems for responsible consumption and production.

In 2014, BLC managed the transition of Philo Ridge Farm from an old dairy operation to a multilayered regenerative agriculture business that integrates grass-fed livestock, orchards, gardens, and farm-based community events. This included introducing cover crops, composting, low-till practices and becoming Certified Organic. The Philo Ridge project created new jobs and economic growth opportunities for the community, a healthier ecosystem, and a locally based market for sustainable produce and meat. As the benefits expanded into the community, so did opportunities to expand the impact of the stewardship development model.

It was at an event at Philo Ridge Farm that Meriwether Hardie and her team met the Cushing family, owners of the nearby Vermont Livestock Slaughter and Processing Company (VLSP). This small, local, family-owned meat processing plant plays a critical role in the local food supply chain by providing small regenerative farms like Philo Ridge a market to sell their products and sustain their land stewardship practices. However, with the consolidation of the meat processing industry, where four companies control more than 80% of U.S. beef supply, margins for local processing facilities like Vermont Livestock are dwindling and many across the country are closing, creating a debilitating financial bottle neck for local ranchers.

In early 2021, BLC stepped in as a partner to address the challenge of finding capital to finance a full renovation and modernization of the VLSP operation. Jacob Ward, Food and Farm Operations Manager at BLC, soon discovered that banks were not interested in supporting the project “as the current margins didn’t meet the risk standards of conventional institutions and the value of the assets and property wasn’t sufficient collateral for their loans.” Therefore, they needed to get creative. Bringing together thought partners from Vermont’s Flexible Capital Fund, investors from ImpactAssets, developers at Neagley & Chase Construction, and working closely with the Cushing family, BLC created a 0% interest, revenue-based loan that will allow the Cushing family to retain 100% equity in their business while fully funding the modernization project. By adapting financing to meet local needs, BLC maintained a locally controlled closed-loop food system that reinforced the value of sustainable and regenerative practices.

“Our culture is still addicted to extractive models. [Bio-Logical Capital’s] model looks at how we create a proof of concept around what is the financing need upfront in order to invest differently in the land while creating a long-term model of resiliency and yield.” – Meriwether Hardie

Bio-Logical Capital's Closed-Loop Model for Stewardship Development

Inspiration

Meriwether Hardie grew up on a farm in Vermont where her first official pet was a beehive. “I grew up with my hands in soil, outside, working with food systems but also seeing the dysfunction around where food systems don’t work.” This upbringing led to a commitment to working and studying issues around food systems, specifically around various aspects of the food supply chain. During nearly five years at The Rainforest Alliance, Meriwether built a deep sense of connection with farmers around the world. “I have had the privilege of travelling around the world to get to work with and learn from different farmers, and I have never met a farmer that doesn’t know the best thing for her or his land…[but] so often they’re backed into a corner by the current systems… without options of how to do things differently.”

When Meriwether was approached with the offer to join and help build Bio-Logical Capital, she was intrigued by the idea of doing similar work, but instead of fundraising donations to support the work, “creating a business model for change with the mission and values I associated with a non-profit.” The result has been Bio-Logical Capital and their approach of stewardship development. Meriwether stresses there is no one size fits all model for the food system and their model is constantly evolving to match the needs of the people and the land. However, each new project represents more data, more evidence, and another case study for how investing in the soil and the communities that work it can be both profitable and create resilient and healthy communities.

"We have to offer solutions; we can't just tell someone what they're doing is wrong". -Meriwether Hardie

Overall impact

Philo Ridge Farm and the Vermont Livestock modernization project are perfect examples of stewardship development in practice. Each project creates a net positive impact by improving both human and natural environments while increasing economic prosperity. By taking a systems-based approach to each project, these benefits ripple out across the community, creating a cascade of impacts for every stakeholder involved.

By managing a transition to regenerative farming practices at Philo Ridge Farm, BLC has improved life on land, economic prosperity in the community, and created a local market for the responsible production and consumption of produce and meat. Environmentally, regenerative practices on the farm have augmented soil fertility and carbon sequestration, while creating clean water runoff that enhances surrounding ecosystem resiliency and biodiversity. Grass-fed and rotationally grazed livestock, introduced to the farm in 2016, and a certified organic poultry operation built on site, diversified revenue streams while adding regenerative benefits to the soil. Adhering to their stewardship model, BLC went further to ensure social equity was a key aspect of the project. A year-round kitchen and market were built to serve as a local grocer, gathering space and vendor of local artisan products. BLC also formed a partnership with the University of Vermont to establish a research and evaluation protocol that farms around the state can use to implement growing practices that produce healthy soils.

As their connection to the community grew, BLC was asked to help design a path forward for the local slaughterhouse. Rather than simply taking ownership of Vermont Livestock, Bio-Logical Capital chose to help Vermont Livestock in a way that reflected the needs and realities of the business and its community, including Philo Ridge Farm. To do so, they created a financing model that maintained local ownership of Vermont Livestock and, therefore, local control of the food system.

The financing mechanism developed by Bio-Logical capital reflected the local realities of Vermont Livestock. Conventional debt was not an option, so the financing had to be unconventional. It had to reflect the seasonal realities of meat processing, so repayment of the loan was based on revenue instead of a fixed amortization. With low margins and few assets to function as collateral, BLC found impact investors willing to support an investment at 0% interest. Finally, owners Carl and Karen are nearing retirement age, and so the financing had to protect their equity as well as facilitate the transition to the next generation of ownership. The renovation will allow Vermont Livestock to triple their current capacity, increase cold storage hanging time, and add well-paying jobs with expanded benefits and training. This financial innovation has protected the social and cultural equity of Vermont Livestock both today and for the next generations, and it will provide long-term benefits for the local food system.

Vermont Livestock plays a key role in supporting the local, regenerative, and resilient food system. By remaining locally owned and operated, the financial and ecological benefits of sustainably raised livestock stay within the community. A healthier community then creates more job opportunities, and more investment that generates a positive feedback loop of lasting prosperity.

Business benefit

The stewardship development model is a successful model for business because it is compounding. To design solutions around community needs, Bio-Logical Capital builds long-term connections with the local community and incorporates outside stakeholders like the University of Vermont and ImpactAssets. This community engagement, compounded over time, created more awareness around the success of their work and led to new business opportunities in the community. BLC has now secured multiple grants to continue to fund research and implementation of regenerative practices with nearby farmers, which will require hiring two new full-time staff based in Vermont.

To be successful, the stewardship development model requires a diverse team with a wide array of skills and problem-solving abilities. Meriwether highlighted the importance of BLC being “a cross sectoral team, with different types of expertise, that can speak different languages, come from different lived experiences and that are all really good problem solvers. We often act as translators to build bridges between different stakeholders we work with.” That the mission and work of BLC can attract and retain an intellectually diverse group of employees only reinforces the sustainability of the business and the stewardship development model.

Finally, each successful project has a compounding effect on creating the business case for the next project. To secure funding for all their projects, BLC generates financial models reflecting risk, yields, and returns based on the little data available around regenerative farming practices. Therefore, each successful project is another case study that adds validity and quantifiable metrics to drive further investments in future projects not just for BLC but for the industry at large. Now, as other local slaughterhouses reach out to inquire about the model used for Vermont Livestock, BLC can make a stronger business case to potential investors to finance the project.

“Because we have team members that come from expertise in [science, business, real estate, food operations, legal, human resources, landscape architecture, finance, and farming,] our superpower is really bringing those groups together or representing those groups and building a business and operating plan that incorporates those different values, vocabulary, and modes of operating in a way that is appropriate for the community both socially and ecologically.” -Meriwether Hardie

Social and environmental benefit

According to the EPA, 24% of global greenhouse gas emissions come from agriculture, forestry, and other land use. This is a major reason why we must meet the challenge of UN SDG goals 8, 12 and 15 and create food systems that are regenerative, build resilient ecosystems, increase economic prosperity for local communities and create responsible, locally based systems of production and consumption. The diverse array of collaborations completed by BLC using the model of stewardship development are proof that these systems are not only possible but commercially viable.

Creating this food system begins and ends with the soil. A study published by Michigan State University in 2018 found that the total carbon sequestration of regenerative, holistic grazing produced a net carbon sink. Implementing regenerative practices like those at Philo Ridge farm will sequester carbon, clean water runoff, and build a more biodiverse, resilient ecosystem. The research partnership created with the University of Vermont contributes to the social equity of the project by disseminating best-case practices for soil health for farmers across Vermont as well as strengthening available data on farm yields that may be critical in securing further investments for regenerative practices.

The modernization of VLSP is a case study in how to close the loop of stewardship development. Access to a local buyer incentivizes farmers to invest in holistic grazing practices by ensuring the long-term viability of a market to process and package their livestock. The community is rewarded with more labor-intensive, high-value-added jobs, access to healthier and safer meat, while maintaining equity in their farms and businesses. Thanks to Bio-Logical Capital’s commitment to stewardship development, society and the investment world at large have a proven example of how to invest in the resilient, responsible, interconnected food systems of tomorrow.

Interviews

Meriwether Hardie, Chief Operating Officer

Jacob Ward, Food and Farm Operations Senior Coordinator