Speaker 1: Hello, and welcome to What Goes Up, a weekly markets podcast.
Speaker 1: My name is Mike Reagan. I'm a senior editor at Bloomberg.
Speaker 2: And I'm Bildona Hire, a cross asset reporter with Bloomberg, and.
Speaker 1: This week on the show, Veldana. I don't know if
Speaker 1: I've ever told you about this, but sometimes I literally
Speaker 1: have daydreams that I own a farm and I'm like
Speaker 1: off in retirement as a farmer.
Speaker 2: I think everybody has those dreams. No, I don't know,
Speaker 2: did I, especially if you live in the city. You
Speaker 2: want a sort of more nature.
Speaker 1: Filled life, more nature filled life, I guess.
Speaker 2: That makes it, yes, Or you want a garden or
Speaker 2: something like.
Speaker 1: Don't get me wrong, I don't want a giant, five
Speaker 1: hundred acre farm that I actually have to work at.
Speaker 1: I want a cup a few acres.
Speaker 2: You don't want to have to do any work.
Speaker 1: I'll plant some raspberries, maybe get some sheep.
Speaker 2: I think sheep would require a lot of work.
Speaker 1: Do you think? I think you just spring amongst let
Speaker 1: them meet through grass, and shave them down once a year.
Speaker 1: More to it than that? What else do you need
Speaker 1: to do?
Speaker 2: Feed them? I don't know them.
Speaker 1: That's what the grass is for. But anyway, look, it's
Speaker 1: a good week to daydream about being a farmer, because
Speaker 1: let's be honest, if today's Wednesday, May twenty fourth, if
Speaker 1: we tried to cover the market right now, with the
Speaker 1: debt ceiling issue going on and that being so fast
Speaker 1: moving and such a unpredictable thing, I feel like by
Speaker 1: the time we got done, everything would have changed and
Speaker 1: the news would be so different. So I think for
Speaker 1: this week, let's all daydream about owning a farm. If
Speaker 1: I let you on to my farm, I know you
Speaker 1: refuse to join my professional network on LinkedIn for I
Speaker 1: don't know, But if I were to allow you onto
Speaker 1: my imaginary farm network, would what would you grow on
Speaker 1: my farm?
Speaker 2: Tomatoes?
Speaker 1: Just tomatoes.
Speaker 2: We can use them to feed your sheep.
Speaker 1: I don't think sheep eat tomatoes. I think they just
Speaker 1: eat the grass.
Speaker 2: I really don't know.
Speaker 1: Cauliflower. You wouldn't grow cauliflower. You're a city slicker. Yeah,
Speaker 1: I don't know. If I don't know, if I'm gonna
Speaker 1: let you on my farm, on my imaginary.
Speaker 2: Farm, fine, I won't let you on my imaginary firm. Fine,
Speaker 2: But our guests might have a farm. I want to
Speaker 2: bring him in. It's Carter molloy, CEO and founder of
Speaker 2: acre Trader. Carter, I'm so happy to have you on
Speaker 2: the podcast and talk about your company.
Speaker 3: Thanks for having me here.
Speaker 2: First of all, are you on a farm?
Speaker 3: Not today, though many days I am. I also, while
Speaker 3: I would love to invite you guys to my farm,
Speaker 3: I'm also not really sure I want to join.
Speaker 2: The There you go, I'm not the only one.
Speaker 1: Fine, fine, I'm alone on my farm with my raspberry
Speaker 1: and sheep tomato eating sheep. But Carter, tell us about
Speaker 1: acre Trader. Really a fascinating platform you've started here that
Speaker 1: actually lets people and I suppose institutions invest in fractional
Speaker 1: ownerships of farms. Tell us a little bit how it started,
Speaker 1: how it works, and what's going on with acre Trader.
Speaker 3: For the quick background of the business, We've been here
Speaker 3: for five or six years working on this simple mission
Speaker 3: of connecting farmers that want to grow their business to
Speaker 3: investors that want exposure to farm land in their portfolio.
Speaker 3: I grew up in a farming family here in Arkansas.
Speaker 3: I's spit a dozen years in professional equity investing, but
Speaker 3: in the background, I've been buying and selling farmland it's
Speaker 3: a big passion of mine. Come to find out, there
Speaker 3: are a lot of other people that also want exposure.
Speaker 3: The reality is you may have to go put down
Speaker 3: a million dollars and then manage a business, and that's
Speaker 3: a non starter for most people. So we design an acre
Speaker 3: Trader very simply to be a place where an investor
Speaker 3: can come online, create an account, and within a few
Speaker 3: minutes and a few clicks actually invest directly in entities
Speaker 3: that own farmland. So each week we put up a
Speaker 3: farmer too that's owned by a unique entity. You, the
Speaker 3: investor can come on and invest ten twenty thousand dollars
Speaker 3: or millions of dollars and have exposure and build a
Speaker 3: portfolio of farmland through our website and through our technology.
Speaker 2: Okay, so tell us more about how it works and
Speaker 2: like who the investor base is. So, is it accredited
Speaker 2: investors who are really interested in diversifying their portfolios or
Speaker 2: what does the makeup of the client base look like.
Speaker 3: That's correct, It is a credited investors on the platform
Speaker 3: now that ranges from folks in cities to farmers and
Speaker 3: rural areas and folks that live near farming to institutions
Speaker 3: as well. Family offices, et cetera. The goal for most
Speaker 3: folks is to find some stability and some diversification. That's
Speaker 3: often why we see folks with real interest in farmland
Speaker 3: is that slow, in steady compounding that it can offer
Speaker 3: to investors.
Speaker 1: So if I'm a farmer, I own a farm, I
Speaker 1: sell it to one of these entities, I guess they
Speaker 1: serve sort of as the manager of this investment. They
Speaker 1: collect the rent and distributed among the investors. Is that
Speaker 1: basically it.
Speaker 3: Most often the farmer comes to us, actually, and it's
Speaker 3: usually a farmer that wants to grow. If you think
Speaker 3: about this from the farmer's standpoint, many farmers are in
Speaker 3: growth mode. They have lots of fixed costs, right, very
Speaker 3: expensive equipment, more inputs, seed and fertilizer as an example,
Speaker 3: that they buy the better discounts they get with that
Speaker 3: type of economy of scale and that business. Many farmers
Speaker 3: are actively in growth mode. So they'll come to us
Speaker 3: and say, hey, my neighbors retiring or for whatever reason,
Speaker 3: the farm's being sold. There's upwards of one hundred billion
Speaker 3: dollars of farmland that is bought and sold every year
Speaker 3: in the US. So these farmers that are our partners
Speaker 3: are out actively helping source and find farm lay where
Speaker 3: they want to grow their business. And then you're exactly right.
Speaker 3: We set that up where they often will have a
Speaker 3: financial interest in that entity, and then they will either
Speaker 3: share their revenue or pay a simple rent to that entity,
Speaker 3: which then can be a cash distribution out to those investors.
Speaker 3: So the investors from their angle, they can make money
Speaker 3: from those cash rents coming in as well as through
Speaker 3: appreciation of land over time.
Speaker 2: And then tell us more about your background and the
Speaker 2: inputus for starting the company.
Speaker 3: My dad's a farmer. I've been around it my whole life.
Speaker 3: It's just in my line. I think it's in all
Speaker 3: of our life, right. You guys say you have this
Speaker 3: dream of living in agrarian life, it's because we all
Speaker 3: did at some point in generations. Back I spent my
Speaker 3: life grinding out alpha in public markets and working really
Speaker 3: long days on Bloomberg terminal looking for alpha, and in
Speaker 3: the background buying and selling land. And realize that here's
Speaker 3: this multi trillion dollar asset that's been incredibly productive and
Speaker 3: stable over time. There was no real mechanism for most
Speaker 3: folks to get exposure to it, and so that was
Speaker 3: really the genesis the business was frankly visiting with my
Speaker 3: dad and telling him that this is in like twenty seventeen,
Speaker 3: I thought bitcoin was a terrible investment idea. Really that
Speaker 3: sparked this conversation of can we fractionalize farmland? Is there
Speaker 3: a way where common investors can gain exposure to farmland
Speaker 3: their portfolio.
Speaker 1: What's fascinating is the returns are pretty attractive. There is
Speaker 1: actually a farmland index that tracks the notional value of
Speaker 1: farm land. I guess around the country, but talk to
Speaker 1: us a little bit about sort of that return profile.
Speaker 1: My understanding, it's got a pretty good track record. It's
Speaker 1: not really correlated with risk assets or even treasuries. It
Speaker 1: is correlated with inflation to some degree. Talk to us
Speaker 1: about kind of what you can expect from that return
Speaker 1: profile and the volatility and whatnot. As an investor in farmland.
Speaker 3: First is important to consider what farmland is not. Farmland
Speaker 3: is not a good risk quick scheme. You rarely hear
Speaker 3: people saying, oh my gosh, I doubled my money on
Speaker 3: my farmland investment this year. Inversely, you also don't hear
Speaker 3: people saying, oh my gosh, I've lost all my money
Speaker 3: on farmland this year. What investors often I'm looking for
Speaker 3: is that's slow, in steady compounding of capital. And you're right,
Speaker 3: those returns nay Grief is the index that puts out
Speaker 3: those returns for farmland and timberland. Over the last twenty
Speaker 3: or thirty years, it's been a fairly consistent low double
Speaker 3: digit return eleven or twelve percent nothing, oh my goodness.
Speaker 3: But when you compare it to other mainstream asset classes,
Speaker 3: that return profile is pretty similar over long periods of time.
Speaker 3: What's more fascinating is the consistency of those returns. You
Speaker 3: don't have big, huge up years and huge down here
Speaker 3: that you do across so many other mainstream asset classes.
Speaker 3: So again, the consistency of the returns and that relative
Speaker 3: lack of volatility an investor's speak, means that the sharp
Speaker 3: ratio of farmland can be very very attractive the risk
Speaker 3: adjusted returns there. And then in addition to that, you've
Speaker 3: also called out a couple of key themes. What is
Speaker 3: it can be inflation linked. It's actually shown to be
Speaker 3: more inflation linked than gold, in that in times of
Speaker 3: high inflation or persistent inflation, it tends to outperform and
Speaker 3: also that it just doesn't have a lot of correlation
Speaker 3: to other asset classes, like it's almost exactly zero in
Speaker 3: its correlation to the S and P. So from a
Speaker 3: diversification standpoint as well, we see folks adding farmland in
Speaker 3: their portfolio to have that sort of set in and
Speaker 3: forget it part of their portfolio where they're looking for
Speaker 3: company a capital or wealth preservation.
Speaker 2: I was curious about the correlation aspect as well, because
Speaker 2: I was wondering what PUSH's price is higher or lower,
Speaker 2: and whether or not, you know, maybe you can tie
Speaker 2: to the housing market in some way, or what market
Speaker 2: it would be similar to, or where those some of
Speaker 2: those correlations might lie.
Speaker 3: So as a general sense, we don't really see correlations
Speaker 3: to things like housing market or primary asset classes. Where
Speaker 3: we do see some correlation again over longer periods of time,
Speaker 3: is commodities, Right, so you think about we grow food, fuel,
Speaker 3: and fiber on farmland, that tends to be those tend
Speaker 3: to be a core component of commodity CPI PPI type
Speaker 3: of indicators, and so as a result, we do tend
Speaker 3: to be linked to that inflation and price over time.
Speaker 3: And as you can imagine in the world of supply
Speaker 3: and demand for farmland commodities.
Speaker 1: It's fairly straightforward.
Speaker 3: We have more and more mouths to feed every year
Speaker 3: and to provide clothing and fuel to, and frankly like
Speaker 3: less and less actual physical farmland. We lose like staggering
Speaker 3: amounts of farm land every minute and every day here
Speaker 3: in the US to development, to growth onto other now
Speaker 3: larger solar developments, things like that. So finite supply, it's physical,
Speaker 3: and it's limited and is shrinking and growing demand over
Speaker 3: time with the products that we produce.
Speaker 1: So I'm curious about sort of the risk management or
Speaker 1: potential downside of this type of investment. Say, you know,
Speaker 1: I buy a fractional ownership in a farm in a
Speaker 1: state where there's a bad drought or I don't know,
Speaker 1: a bull weavile outbreak or something that really impacts the
Speaker 1: production of whatever they're growing on that farm that year
Speaker 1: so much so that the farmer can't pay his rent
Speaker 1: and maybe even you know, his defaults on his tracker
Speaker 1: lease or equipment or whatever, and it's kind of has
Speaker 1: a net loss for that year. How does that play
Speaker 1: out in an investment like this?
Speaker 3: So we tend to think of the world generally speaking,
Speaker 3: as OpCo and propco. Right, your operating company is the
Speaker 3: farming business. Your property company is owning the underlying land,
Speaker 3: and so we tend to look more to be the
Speaker 3: property company in that scenario. Whereas the farmer is the
Speaker 3: operating company. They often have insurance to help backstop them.
Speaker 3: Often government subsidize insurance at that so as a tenant
Speaker 3: and as a partner, farmers tend to be very stable
Speaker 3: over time, and as a result we see we do
Speaker 3: see very low default into our vacancy rates throughout the ecosystem.
Speaker 3: As an example of that, in the world of row crops,
Speaker 3: so thinking about growing important commodities like corn, soybeans, farmer
Speaker 3: often pays rent once a year before they plant. It's
Speaker 3: an incredibly stable across the larger world of farmland. For
Speaker 3: that reason, there are certainly risks in there, and one
Speaker 3: of the greatest ones is just underwriting risk, making sure
Speaker 3: that you are actually in fact buying farmland well. And
Speaker 3: it's really hard to do because there's such a lack
Speaker 3: of information in our world. So we've invested heavily. We've
Speaker 3: got a large data science and engineering crew here as
Speaker 3: an example, helping to build underlying geospatial analytics and data
Speaker 3: for us just to help inform these underwriting decisions. And
Speaker 3: we've got a great team well outbuilding partnerships with farmers.
Speaker 3: What actually makes it through that that very very tight
Speaker 3: filter that team employees.
Speaker 2: I do want to ask you more about that, because
Speaker 2: when I was talking to some of your employees before
Speaker 2: the podcast, when I met them a couple of weeks ago,
Speaker 2: I think somebody said, it's like, you can almost think
Speaker 2: of it as like the Bloomberg terminal, but for farmland
Speaker 2: statistics and for farmland data. First, I want to ask
Speaker 2: you how is farmland performing of late? And I'm also
Speaker 2: curious how it fared like what prices did during the pandemic,
Speaker 2: for instance, and what it's been like over the last
Speaker 2: couple of years.
Speaker 3: So, as a general statement, on the appreciation side, of
Speaker 3: the years before the pandemic, the five or six years
Speaker 3: before then, we saw relatively muted appreciation. We have seen
Speaker 3: some catch up in that long term call it mean
Speaker 3: reversion in terms of appreciation the last few years so
Speaker 3: we've seen more meaningful, call it double digit versus your
Speaker 3: typical single digit type of growth in the underlying asset.
Speaker 3: The rents themselves are the income coming off the farm
Speaker 3: generally speaking, has also grown over that same time period.
Speaker 1: I'm curious if there's any sort of shareholder democracy type
Speaker 1: of components of this. You know, if I end up owning,
Speaker 1: say fifty one percent of a farm, or you know,
Speaker 1: I own thirty percent and of like mind with someone
Speaker 1: that owns another thirty percent and we have that majority stake,
Speaker 1: is there sort of an option to say, oh, you know,
Speaker 1: I think we need to start growing corn instead of soybeans,
Speaker 1: or I think it's time to sell. Is there any
Speaker 1: sort of equity democracy at action as far as ownership?
Speaker 1: You know, where is it all the the property companies
Speaker 1: and the operating companies that control that? It tends to
Speaker 1: be the latter.
Speaker 3: So we have an investment committee that works on behalf
Speaker 3: of the investors to consider what the best outcomes are
Speaker 3: for those investors on an entity by entity basis. And
Speaker 3: the reason for that is is we and then aside
Speaker 3: from that, we also have common standardized corporate wraps and
Speaker 3: government wraps around these entities for obvious reasons, to be
Speaker 3: pretty standardized across our business. And what we want to
Speaker 3: avoid is a fifty one percent layer coming in and bullying, right,
Speaker 3: and actually making decisions that are averse to the best
Speaker 3: outcome for the rest of that majority or best that
Speaker 3: minority investor pool. So as a whole, that tends to
Speaker 3: be more of the investment committee. Now, look, we speak
Speaker 3: to investors. We've got to investor relations team here. We
Speaker 3: hear their input every day and we certainly take that
Speaker 3: that means a lot to each of these individual investments.
Speaker 3: But again we have to consider the greater hole of
Speaker 3: investment fooled capital there rather than one individual's desires.
Speaker 2: And so carter to go back to the data mining question,
Speaker 2: like how do you guys go about gathering your data
Speaker 2: what actually makes good farmland when you are evaluating it?
Speaker 2: And then where in the US or even internationally are
Speaker 2: you guys operating.
Speaker 3: So in the US we're in I think eighteen or
Speaker 3: nineteen states plus Australia, so we're well o our forty
Speaker 3: thousand acres invested through platform. In terms of what considerations
Speaker 3: go into underwriting, you've got to consider soil profile, so
Speaker 3: the health of that soil water availability is absolutely crucial,
Speaker 3: and or places like the Midwest, actually getting water off
Speaker 3: of the farm is just as important as it is
Speaker 3: finding water. So water is a really intense consideration the
Speaker 3: climate in that area, what is it good to grow?
Speaker 3: And then the financial profile, right, so you're underwriting the
Speaker 3: farmer themselves and that's an entire separate process. And then
Speaker 3: the actual bones of that farm, the structure of it.
Speaker 3: And this is where the data analytics really comes in
Speaker 3: and is helpful. That can be government data sets that
Speaker 3: we're processing and bringing in, satellite data sets as well
Speaker 3: that we're bringing to our tools, and then importantly things
Speaker 3: like comparable sales. I know this sounds ridiculous, but if
Speaker 3: you're buying a home, you've got a pretty good sense
Speaker 3: of value on price per square foot in that neighborhood
Speaker 3: in farmland. Not only do we not have that data,
Speaker 3: but the idiosyncrasies and quality from one partial to the
Speaker 3: next can be pretty dramatic. So as a result for
Speaker 3: gathering data they as an example, we're in with data
Speaker 3: from thousands of courthouses around the US. We also have
Speaker 3: a team of people who are literally going and attending
Speaker 3: auctions virtually or going online and finding information and manually
Speaker 3: and putting into that system. But that's the reality of
Speaker 3: this older industry you work in, is there is a
Speaker 3: real manual data gathering and filtering and analysis process that
Speaker 3: goes into helping us understand and inform each investment decision.
Speaker 1: I was clicking around on the website and for a
Speaker 1: day dream farmer like myself, it's the pictures that are
Speaker 1: just awesome. You know. You get these big aerial views
Speaker 1: of the farms, and there's videos sometimes, and I think
Speaker 1: you've now got me daydreaming about owning a vineyard instead
Speaker 1: of a farm Ville dona. I think I might want
Speaker 1: a vineyard.
Speaker 2: There's a it sounds like you're ready to move.
Speaker 1: California vineyard I've got my eye on after clicking around
Speaker 1: acre Trator. But these daydreams are all adjacent to my
Speaker 1: daydream of winning the lottery, by the way, that that's
Speaker 1: race this is all going to do.
Speaker 2: We even play the lottery.
Speaker 1: When it's over a billion in pay out, A group
Speaker 1: of friends of mine springs in action and we all
Speaker 1: buy a share.
Speaker 2: I don't eyone want to know what the most is
Speaker 2: that you've ever won, like twelve twelve cents.
Speaker 3: Isn't this a podcast about logical and reasonable investing?
Speaker 4: Yes, it's supposed to be, Yes, yes, fair enough, fair enough,
Speaker 4: But Carter, I'm curious what you know sort of the
Speaker 4: regulatory regime is for you.
Speaker 1: You know, are you are you registered investment advisor? Like,
Speaker 1: how does this company exist in the eyes of the
Speaker 1: regulators and what process do you have to go to
Speaker 1: both federally and state by state to launch a product
Speaker 1: like this.
Speaker 3: We've actually gone quite a bit further and stood up
Speaker 3: our own broker dealer, so acri Trader has a wholly
Speaker 3: owned broker dealer in order to make sure that we're
Speaker 3: always compliant with the letter and this period of the law.
Speaker 3: And it extends beyond securities regulation as well. Right there
Speaker 3: are farming regulations you must take into account, ownership regulations,
Speaker 3: a real estate regulation state by state. Suffice to say,
Speaker 3: we have an incredible general counsel and team of attorneys
Speaker 3: that work with her to help us navigate and make
Speaker 3: sure that we're continuously presenting ourselves and the investment offerings
Speaker 3: and the appropriate way and.
Speaker 2: Gard I'm also curious about how liquid the market is.
Speaker 2: I would imagine it's pretty ill liquid, but maybe you
Speaker 2: can tell us more.
Speaker 3: That's correct, So the market as a whole, the percent
Speaker 3: turnover within farmland is lower than comparative assets. There's still
Speaker 3: fifty upwards of one hundred billion dollars of this stuff
Speaker 3: that trades hands every year in the United States alone,
Speaker 3: So there's still quite a bit of There's a ton
Speaker 3: of reasons why folks would buy or sell farmland, right,
Speaker 3: So there is a decent amount of turnover out there.
Speaker 3: We obviously as a company want to help improve that
Speaker 3: liquidity within the market and then within our specific business.
Speaker 3: We've been working on a secondary marketplace for a long
Speaker 3: time where we would hope to allow investors to and
Speaker 3: exchange in individual units or shares of those bums.
Speaker 1: Yeah, I was going to say, I imagine a platform
Speaker 1: like yours would bring a lot more liquidity potentially in
Speaker 1: theory to this market. But as of now, so if
Speaker 1: I put a click around the website, it looks like
Speaker 1: fifteen thousand is tends to be the minimum investment. Is
Speaker 1: that about right?
Speaker 3: Give or take? That's usually right?
Speaker 1: Yeah, So, and I'm locked in for at least a year,
Speaker 1: I think, Right, what's the liquidity event for me? If
Speaker 1: I do want to get out of that investment? How
Speaker 1: does that work?
Speaker 3: So the vehicles usually have a five to ten year
Speaker 3: life on them, sometimes it can be longer, and this
Speaker 3: is explicitly stated on the website. Sometimes it can be
Speaker 3: shorter than that. So there's the duration of the vehicle
Speaker 3: itself that the investor must take into account and the
Speaker 3: illiquidity that comes along with that, and we are looking
Speaker 3: for again this is sort of like your patient investing capital.
Speaker 3: So setting over on the side a little bit, so
Speaker 3: there is a real liquidity consideration in investing in farmland,
Speaker 3: not just your platform, in the asset in general. And
Speaker 3: then again I think you nail the specific point. There's
Speaker 3: a one year minimum regulatory lock up on these types
Speaker 3: of securities, at which point you can have the ability
Speaker 3: to sell out to friends or family and we hope
Speaker 3: soon through a secondary market place within our business as well.
Speaker 2: And then can you tell us about any ESG aspects
Speaker 2: when it comes to investing in farmland? Is that maybe
Speaker 2: one of the considerations or one of the things clients
Speaker 2: do tell you when they are looking to invest. Is
Speaker 2: that a consideration they do, and it's an important one.
Speaker 1: We don't lead with ESG.
Speaker 3: Often that can be like meeting somebody for the first
Speaker 3: time and they say, hey, you can trust me. We
Speaker 3: believe as like stewards of this world we live in,
Speaker 3: and as human beings and it's the right thing to do,
Speaker 3: so the impact for farmers and growing their business is
Speaker 3: certainly important. We enroll each farm in a sustainability standard
Speaker 3: called Leading Harvest, so that we're not just using words
Speaker 3: like regenerative or throwing around buzzwords. This is like a
Speaker 3: merit based, checklist based sustainability standard on a per farm
Speaker 3: basis that we enroll. We actually just passed all of
Speaker 3: our farms through that here recently. We're very proud of
Speaker 3: that milestone. And then beyond that, we do tend to
Speaker 3: invest pretty intensely in things like CAPEX projects, water projects
Speaker 3: to make sure we're utilizing water appropriately and not overusing it.
Speaker 3: We do a good number of organic transitions in some
Speaker 3: cases with farmers as well, so all of those are
Speaker 3: heavily considered in the investment process and an important part
Speaker 3: of what we do. We have an impact page on
Speaker 3: our website where investors can go find that information as well.
Speaker 1: Carter. Obviously, in investing, the magic word that always comes
Speaker 1: up is diversification, and I wonder, obviously, if you're allocating
Speaker 1: some percentage to farmland, you're diversifying away from a lot
Speaker 1: of traditional assets. But I wonder in the future, is
Speaker 1: there do you think there'll be a potential to sort
Speaker 1: of diversify within farmland. For example, say I do want
Speaker 1: to invest fifteen thousand in farmland, but I want it
Speaker 1: split up one thousand over fifteen farms, kind of a
Speaker 1: mutual fund of farmland. Is there a lane for that
Speaker 1: to happen? Do you think in the future.
Speaker 3: We've evaluated a number of pool vehicle type of products,
Speaker 3: and I think there is a likely future where that exists.
Speaker 3: And the other consideration then too is we do see
Speaker 3: lots of folks come build that portfolio within our platform.
Speaker 3: So most of our investors invest in multiple farms. And
Speaker 3: you can think about our world broken into three primary buckets.
Speaker 3: That is row crops, so things that you plant each year, corn, cotton, soybeans,
Speaker 3: rice where I come from. Then there are permanent crops
Speaker 3: things to grow on. Trees tend to be longer duration
Speaker 3: of assets. And then Timberland is a third component of
Speaker 3: this land investing category and it's its own unique beast.
Speaker 3: But we do see folks quite often building a diverse
Speaker 3: flied portfolio within our website across those land use types.
Speaker 1: Carter, we can't let you go just yet. We have
Speaker 1: an attriition here on what goes up where every week
Speaker 1: we talk about the craziest things we saw in markets
Speaker 1: this week, or we're flexible this month, this year, whatever
Speaker 1: you got do. What do you have for us this week?
Speaker 2: Okay? Mine is so good? Actually so Taylor Swift has
Speaker 2: been on tour, as the entire world knows. I think
Speaker 2: it's supposed to be like the highest grossing tour in
Speaker 2: the history of the world. And she played in Gillette
Speaker 2: Stadium a couple of days ago and it was pouring rain.
Speaker 2: And now there's at least one fan I couldn't actually
Speaker 2: tell if it's more than one person who was at
Speaker 2: that show, bottled a bunch of the rain water, put
Speaker 2: it in containers and is selling it on Facebook marketplace
Speaker 2: for two point fifty per container.
Speaker 1: Oh my gosh.
Speaker 2: Well, apparently there were a bunch of comments. I want
Speaker 2: to say they're from swifties who are probably serious about this,
Speaker 2: who commented like, is it rainwater from inside the stadium
Speaker 2: or is it from the parking lot? Because it makes
Speaker 2: a difference.
Speaker 1: Well, that's a big thing. My daughter and her friends
Speaker 1: actually went just to hang out in the parking lot
Speaker 1: in Philadelphia and there were like thirty thousand people there
Speaker 1: just listening from the outside that this is such a
Speaker 1: phenomenon like nothing. All right, next time I'm sending her
Speaker 1: with gallon jobs.
Speaker 2: You just have to label it like the and just
Speaker 2: like Taylor, you know, whatever happened like and.
Speaker 1: There's no room for fraud in that market whatsoever.
Speaker 2: I'm sure you can tell when you look at the
Speaker 2: rainwater that it was from there.
Speaker 1: How about you, Carter, you see anything crazy recently?
Speaker 4: You know?
Speaker 3: The conversation around proposals are banning short selling seems pretty
Speaker 3: wild me, like a really bad idea. We learned that
Speaker 3: once around two thousand and eight, and yet here we are.
Speaker 3: Here we are again, and every person just about involved
Speaker 3: in that decision at that moment came back and said, whoa,
Speaker 3: that was a bad idea. It didn't help. And here
Speaker 3: we are again talking about it. So that one's bothering
Speaker 3: me a little bit. And the other is the obvious
Speaker 3: conversation around the dead ceiling. And let's put aside, like
Speaker 3: the dead ceiling conversation itself, the reality of like black
Speaker 3: Swan events, right, and we get used to the escalator
Speaker 3: on the way up, and we forget there's an elevator
Speaker 3: on the way down in markets and the world of
Speaker 3: black Swan events, it feels like as maybe as I
Speaker 3: get older, they tend to pop their heads up more
Speaker 3: and more and again like a reason why we like
Speaker 3: stability and what we do. But in all seriousness, you know,
Speaker 3: it feels as though many investors don't hedge against that
Speaker 3: appropriately right what we see open calls pretty wide on
Speaker 3: the VIX right now, and so plenty of like doom
Speaker 3: hedging going on, But it still feels like markets don't
Speaker 3: appropriately appreciate, nor do individual investors hedge those types of
Speaker 3: risks in their portfolio.
Speaker 1: Good points all around, and you know, it reminds me
Speaker 1: of I think probably the most appealing or one of
Speaker 1: the most appealing aspects of farmland is that scarcity notion
Speaker 1: and that they're not making any more farmland. When's the
Speaker 1: last time you heard, you know, this neighborhood was torn
Speaker 1: down and a farm was put in its place. So
Speaker 1: the opposite of crypto there with the never ending supply
Speaker 1: scarce and getting scarcer by the day. So all right,
Speaker 1: great stuff all around. I'll give you mine, I confessed
Speaker 1: minds not exactly markets related, but it is financial related.
Speaker 1: And it speaks to duration risk to some degree. I'm
Speaker 1: stretching that a little bit, but I'll give it to
Speaker 1: you anyway. This is courtesy of USA Today. I'll just
Speaker 1: read you the lead because it's speaks for itself. An
Speaker 1: overdue book has been returned to a Northern California library
Speaker 1: after nearly one hundred years. It was the name of
Speaker 1: the book was A History of the United States by
Speaker 1: Benson Lossing, was published in eighteen ninety two. So missing
Speaker 1: a few things in a History of the United States
Speaker 1: published in eighteen ninety two. Somehow some guy found this
Speaker 1: in his house, realized it was a library book, returned
Speaker 1: it to the library. Sure enough, they're very happy to
Speaker 1: have it back ninety six years late. So you're probably
Speaker 1: wondering what's the financial angle of this. Well, now that's
Speaker 1: time to play the prices precise. What do you think
Speaker 1: the estimated overdue fee is for a library book that
Speaker 1: was ninety six years late? Start with you Wildana, get
Speaker 1: out your Texas instrument calculator and start doing some meth.
Speaker 2: This is really hard, and also I can't believe that
Speaker 2: this library is still around and open that they're able
Speaker 2: to accept.
Speaker 1: This book back. That's pretty amazing.
Speaker 2: Okay, I'm going to go with three thousand, seven hundred
Speaker 2: fifty dollars.
Speaker 1: Three thousand, seven hundred and fifty dollars, Carter, standard prices
Speaker 1: right rules. In effect, what do you guess the overdue
Speaker 1: bill is?
Speaker 3: You know, even though we're playing prices right rules, I'll
Speaker 3: lean in a little harder. I'll go ten thousand, ten.
Speaker 1: Thousand, seventeen hundred bucks, which to me is the crazy
Speaker 1: part that it It is only seventeen hundred bucks after
Speaker 1: ninety six years O me. Yeah, I think, well you're
Speaker 1: both over, but I guess your closest. We'll we'll give
Speaker 1: it to you. Okay, I win, all right, all right, fine,
Speaker 1: the rare W for Vildana. The price is precise, but
Speaker 1: the library, you know, it doesn't see obviously they're not
Speaker 1: going to charge this guy because he didn't check it out. Presumably.
Speaker 1: I don't think he's one hundred and thirty years old. Carter.
Speaker 1: Great to catch up with you and hear all about incritrator.
Speaker 1: Really fascinating acid class, I think. And I'm gonna go
Speaker 1: back on there now and daydream about. There's a pistachio
Speaker 1: form too that clut my eye what's your at any
Speaker 1: farms come up that you've just been like, Wow, this
Speaker 1: is this is the one. If I had eight million,
Speaker 1: I'd buy this one.
Speaker 3: You know, I have pretty regularly invested on our platform,
Speaker 3: so I'm a I'm a big fan of what our
Speaker 3: team does and the quality of farm offerings.
Speaker 1: There very diplomatic answer there, I know.
Speaker 2: I was like, that's not even an answer. No one's listening.
Speaker 2: You can tell us.
Speaker 1: Corener, thanks so much for your time. We really appreciate it.
Speaker 3: Michael Donald, thank you both.
Speaker 1: It's been a pleasure.
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