The EIB and CrowdFarming sign loan to support a sustainable food supply chain and organic farmers in Europe (InvestEU)
InvestEU support sustainable food supply and organic farmers
- The €15 million venture debt loan will mainly fund the research and development activities of CrowdFarming, a Spain-based company with a strong presence in France, Germany, Austria, and Italy that facilitates direct sales of food between EU farmers and consumers.
- The project contributes to the EU's Farm to Fork Strategy, which seeks to achieve a fair, healthy and environmentally friendly food system.
- This agreement is supported by the InvestEU programme, which aims to trigger more than €372 billion in additional investment over the period 2021-2027.
The European Investment Bank (EIB) has signed a venture debt loan of €15 million, backed by the InvestEU programme, with CrowdFarming, an online platform for European farmers to sell directly to end-consumers. The EIB financing will help to boost the research, development and innovation (RDI) activities of the company by enhancing their digital marketplace and developing tools that promote sustainable agricultural practices across Europe, and a more sustainable and fair food supply chain.
CrowdFarming's marketplace currently has more than 300 farmers from 13 European countries selling to end-consumers without intermediaries. In this innovative farmer-to-consumer system, farmers set their own prices and customers get fresh, organic, in-season food delivered straight from the farms to their doors. CrowdFarming provides farmers with the website, the logistics, customer service, training and marketing support. They are selected by agronomists (acting as farmer-hunters) who ensure that they apply the highest sustainability, quality and production standards: to join the marketplace, farms must practice organic agriculture or be transitioning towards such practices. CrowdFarming has also become a main selling channel for pioneering farmers who implement regenerative practices that are good for the environment and biodiversity.
The EIB financing will accelerate the transition to a more sustainable, efficient and fair food supply chain in Europe, as well as the adoption of sustainable and regenerative practices in the agricultural sector. CrowdFarming's model creates a shorter producer-to-consumer supply chain by eliminating the need for intermediaries and warehousing, resulting in fresher untreated food and lower rates of food waste, CO2 emissions and energy consumption compared to the conventional cycle.
The EIB support will also help create around 200 direct jobs: over the investment period 2023-2026 there will be a need to recruit highly qualified engineers for the RDI team, agriculture specialists as farmer-hunters, and logistics specialists, among others.
This transaction comes under InvestEU's research, innovation and digitalisation policy area. The project will support Europe's green and digital transition, and is aligned with its Farm to Fork Strategy, which seeks to create a fair, healthy and environmentally friendly food system.
The agreement was signed in Madrid by EIB Vice-President Ricardo Mourinho Félix and CrowdFarming CEO & Cofounder Gonzalo Úrculo.
Commissioner for the Economy, Paolo Gentiloni, said: “The InvestEU programme plays a vital role in helping businesses across Europe to access the financing they need. Thanks to this agreement, we are fostering economic growth and job creation, while ensuring that an increasing number of Spanish companies will be at the forefront of establishing a more sustainable, innovative, and efficient food system. This initiative is a good example of how we can further our efforts to achieve our environmental objectives and reinforce the EU's competitiveness.”
“We are thrilled to support CrowdFarming's innovative and sustainable farmer-to-consumer business model. By financing CrowdFarming, we are not just helping to bring fresh, organic food directly from farms to the doorstep of consumers across Europe — in line with Europe's green and digital priorities. We are also driving a shift towards a more sustainable and efficient food supply chain,” remarked EIB Vice-President Ricardo Mourinho Félix. “We are pleased to be backing this innovative company's RDI activities, under the InvestEU programme, to scale up their potential to improve agricultural sustainability while enhancing employment and economic growth in rural areas of the European Union.”
“At CrowdFarming we believe that enabling direct selling from organic farmers is key to building a more sustainable supply chain in Europe. Direct selling is better for the farmer, who receives a fairer price, for the consumer, who gets fresher food, and for the environment because it reduces travel time and unnecessary packaging,” stated CrowdFarming CEO & Cofounder Gonzalo Úrculo. “Furthermore, creating direct communication channels between farmers and consumers allows for greater awareness of the value of food and eliminates the demand for aesthetic criteria in the fruits we eat. Having received the support of the European Investment Bank will enable us to expand the services and solutions for direct selling that we offer to farmers, transforming direct sales from a niche channel into a real consumption alternative for all Europeans.”
The EIB offers a wide range of products, including equity investments, that make venture debt loans available. These are loans to early-stage companies that furnish the liquidity needed to do business between equity funding rounds. To receive an EIB venture debt loan, a company must be able to demonstrate that it is innovative, or that it is (or will be) disruptive to the market in line with the long-term strategic goals of the European Union.
Background information
The InvestEU programme provides the European Union with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It also helps mobilise private investments for the European Union's policy priorities, such as the European Green Deal and the digital transition. The InvestEU programme brings together under one roof the multitude of EU financial instruments currently available to support investment in the European Union, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented through financial partners that will invest in projects using the EU budget guarantee of €26.2 billion. The entire budget guarantee will back the investment projects of the implementing partners, increasing their risk-bearing capacity and thus mobilising at least €372 billion in additional investment.
The European Investment Bank is the long-term lending institution of the European Union, owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals.
CrowdFarming is Europe's leading platform for the direct sale of organic food. Founded in 2017 by Juliette Simonin, Moisés Calvino, and brothers Gabriel and Gonzalo Úrculo, they currently have over 300 farmers selling organic food from their farms to more than 500,000 families in Europe. The company provides all the necessary tools farmers need to create their own direct sales channel, whilst enabling consumers to buy quality organic and regenerative products directly from farmers. CrowdFarming pioneered the adoption model in agriculture, which allows consumers to reserve their share of the harvest of a farmer on exchange for a fair price. The company is hence scaling direct sales in Europe through a win-win-winner approach: CrowdFarming benefits farmers, consumers, and creates a positive impact in society and the environment.
