Rob Leclerc has the kind of pedigree that investors tend to like: He has a master’s degree in computer science from the University of Calgary and a Ph.D. in computational biology from Yale. In fact, 10 years ago, what he really wanted to do with his degree was find and fund agriculture-related projects that would address climate change.
But a decade ago, “agtech” still wasn’t a category, and that was problematic when it came to pitching investors to the concept of an investment fund that Leclerc would manage with his partner Michael Dean, with whom Leclerc had previously operated an agribusiness. in West Africa for several years.
At the time, “there were a handful of businesses” related to agricultural technology that investors were aware of, Leclerc said. Think of Climate Corp and Impossible Foods and the smart machinery company Blue River. But Climate Corp had not yet sold to Monsanto for $1 billion. Impossible Foods was not valued in the billions of dollars, as it is today. And Blue River was still years away from his $305 million sale to John Deere.
“The general problem was the narrative,” Leclerc said. “People didn’t care.”
He and Dean could have given up; instead, they started a San Francisco-based content company called Ag Fund News.
“We thought if we could get people excited about food and [agriculture]maybe we’d be able to [raise a fund later]Leclerc said. She was a smart bet. Fast forward and after posting more than 4,000 articles to the site and gaining 90,000 subscribers to the site’s weekly newsletter, Leclerc said agfunderThe investment team at, now numbering four partners, has just closed $60m in capital commitments for a new fund that they hope will reach $100m in the coming months if things go well.
It’s a big step up from previous funds that Leclerc and company began raising several years ago, starting with the readers of their newsletters. “First we raised a $2.5 million fund from friends and family,” he said, “but then five months later we needed more money, so we raised $2 million, then six months later we raised $5 million.” And so. It wasn’t the most conventional way to raise money, but AgFunder had this “massive subscriber base” that they could talk to directly about their fundraising efforts, Leclerc said, “and the belief that we know what we’re doing and we can spotting companies started a lot of conversations that we wouldn’t have had otherwise. It became a structural advantage.”
The strategy is unprecedented. Leclerc said he was inspired in part by Michael Arrington, the founder of TechCrunch, who built a brand around entrepreneurship and then used the strength of that brand to launch an investment career. Meanwhile, Arrington was preceded in his path by investor Jason Calacanis, who previously founded a media company, and more recent examples are starting to emerge routinely. Among them: Londoner Harry Stebbings used his “Twenty Minute VC” podcast as a springboard into the venture world last year, and Nik Milanović, author of a newsletter two years ago called “This Week in Fintech,” launched in January investor syndicate called Fintech Fund.
Still, newsletter subscribers, no matter how deep their pockets, don’t invest tens of millions of dollars in a piece of equipment without first seeing some results. And AgFunder (which has since expanded its LP base) already has some to brag about. Among the 60 companies that have so far received an AgFunder check is autonomous tractor startup Bear Flag Robotics, which sold to John Deere last year for $250 million; Root AI, a startup that was developing a harvesting robot for indoor farms and was acquired by AppHarvest to $60 million last year; and Greenlight Biosciences, a biotechnology company focused on RNA research that went public last month by merging with a special purpose acquisition company.
If you’re curious about how much the company owned in each of these companies, keep guessing. AgFunder, which tends to write $500,000 checks as a starting point but also just wrote a check for $3 million, doesn’t think about ownership goals or seek to own a specific percentage in a company, Leclerc said. While his team has used special purpose vehicles to maintain its pro rata at various companies, including a still-private molecular coffee company called Atom Coffee, said he doesn’t “obsess over property. For me, the question is: ‘Does this investment return the fund or a multiple of the fund?’ If you become obsessed with property, you can miss out on opportunities.”
As for the criteria, AgFunder looks broadly at the food and agriculture value chain, Leclerc said. It also invests broadly geographically, with bets in India, Brazil, Mexico and Indonesia, among other places.
There is a lot of ground to cover, so the team relies heavily on their engineering manager and the internal system it has devised to scour sites and databases for signals that it then distills to “50 to 100 companies every week” that might be of interest. (An apparent gem he discovered was Retailo out of Pakistan, a B2B marketplace that connects wineries with the goods and services they might need, and recently closed the $36 million in Series A funding. AgFunder has now backed it in two rounds).
However, AgFunder also has other sources of deal flow, and one of them is, yes, reading the newsletter. In fact, he was asked how he found out that the Atomo coffee company, which says its product produces 93% less carbon emissions than conventional cold coffee: Leclerc said the advice came from a limited partner who had signed on as an investor after becoming a regular reader.
“An LP who followed us for a long time on AgFunder News wrote to us and said, ‘You probably see a lot of stuff; this company you should check out.’ That’s how we did it,” Leclerc said.