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Mark Olson talks about the combination of America's shaky finances and poor eating habits as though they were the Brady Bunch.
"We're putting together two systems that are broken," says the second-generation Spring Green farmer.
Olson is part of a group of farmers, investors and thinkers in southern Wisconsin who are trying to use new investment strategies to save a failing farming industry.
With his broad forehead, deep blue eyes and high, sharp cheekbones, Olson looks like the actor Michael Douglas - that is, except for the gray-flecked ponytail that drops to his bluejeans waistline.
"Local food is a trend," observes Olson, in a soft voice that nonetheless commands attention. "Guaranteed, it will shift to the next Pet Rock. Historically, nothing lasts."
Olson has earned the right to predict and critique Americans' eating habits: He's helped write standards for organic dairy products, is widely credited with introducing basil to the Madison area 30 years ago, and has been a mainstay of the Dane County Farmers' Market.
"But what's really clear to me," he says, "is that we have an opportunity right now. There's a consumer pull for local food, and if we're able to get infrastructure built underneath that, it will last past this consumer fad."
With that goal in mind, Olson and others have over the past 18 months quietly gathered at places like the Willy Street Co-op and the meeting room at Olbrich Gardens to discuss how to radically transform the local food economy. They hope to funnel millions of dollars from local residents into investments in the region's agriculture infrastructure: carrot processing plants for hobby farmers; slaughterhouses that will work with small-scale ranchers who know each cow by name; and other tools to let local farmers stand toe-to-toe with the agricultural giants.
"That's the challenge," Olson says. "I like to think that we're entering into what I like to call Wisconsin Farming 3.0." By this he means a third-generation model of agriculture and farming that will move away from an industry controlled by large corporations and toward smaller farms sharing processing infrastructure.
Already, Olson is practicing what he preaches. In the spare room at his company, Renaissance Farms, he has loaned office space to a pair of local brewers and helped incubate the increasingly popular Furthermore Beer.
But what Olson calls "Wisconsin Farming 3.0" has another name nationally. Taking its title from the Slow Food movement, advocates are calling this new investment strategy "Slow Money." The first principle of Slow Money, as listed on slowmoney.org, is that "We must bring money back down to earth." The second principle is, "There is such a thing as money that is too fast, companies that are too big, finance that is too complex."
Since the banking and lending system's collapse in late 2008, the Slow Money movement has been gaining momentum. It now has supporters in Austin, Texas, in Vermont, in the Pacific Northwest and in southern Wisconsin. Its goal is nothing if not ambitious: to radically shift how we invest our money, what food we eat and how we support our communities.
Old concept, new heights
On a gray, cold Saturday morning, Olson joins a small group of local Slow Money proponents in an over-lit conference room at American Family's east Madison campus. They face a crowd of homeowners, schoolteachers and local CEOs to make their first public presentation of the idea.
"How many here are part of a CSA?" asks Olson, referring to community-supported agriculture, where residents pre-buy shares in a local farm and, in return, receive weekly bundles of food. Nearly 30 hands - more than half of the audience - shoot up. Olson nods.
"Well, you're already investing in your local farmers," he says. "You are taking on some of the risk; if the crops don't do as well, you don't get as much."
Slow Money takes this concept to new heights. It's about investing in major infrastructure and financially supporting small farms as businesses that will last. And it's about reprogramming an American public that has been trained to invest for quick returns, often by putting money into remote companies.
Olson leans back into his chair, and Rebecca Ryan steps forward. Ryan, author of Live First, Work Second and founder of Next Generation Consulting, is a former professional basketball player (in the European League) and a seasoned public presenter. She tells a story about coworkers who decided to start investing.
"They tried to put their money in socially responsible companies," she explains. "But it can be difficult to know exactly where your money is going."
It is a familiar story to anyone who has invested in mutual funds, which bundle together investments in diverse stock or commodities. Especially early in the last decade, Americans increasingly plowed their money into mutual funds for dot-com businesses where the primary hope was that one of the companies would become the next breakout Google or Facebook. But with dozens of startups bundled into such funds, it is difficult to discern the merits of any one company.
Ryan, a commanding presence, pauses before delivering the moral of the story: "What we're talking about is investing in things in your line of sight."
Almost every head in the room nods in agreement.
Slow Money is about hands-on - and eyes-on - investing. Indeed, it began with a venture capitalist living near Santa Fe, N.M.
In late 2008, Woody Tasch released a breezy 192-page book with a lengthy title: Inquiries Into the Nature of Slow Money: Investing as If Food, Finances and Fertility Mattered. Published by a small Vermont-based company, the book had a limited release.
Tasch, with sloped shoulders, receding but bushy hair and a goatee touched with white, looks like a radical college professor. His book is peppered with terms like "restorative economy" and challenges bedrock ideas that markets demand growth. And while he meanders at times through personal reflections and nature musings, Tasch came to his ideas after two decades on the frontlines of capital investments.
When his book does fully engage, Tasch delivers one-two punches of economics and ecological directives, like: "We must explore combining direct investments in early-stage food enterprises with a high degree of diversification, by looking at sustainable timber and farmland as asset classes that offer lower risk, while generating substantial benefits in terms of soil fertility and bioregional health."
Throughout the 1990s, at a time when bohemian ice cream makers Ben & Jerry were challenging the notion that corporations couldn't or shouldn't earn money for social causes, Tasch was leading a broader initiative to leverage asset management into philanthropic work. In 1998, he became chairman of an unimaginatively named yet dynamic group called the Investors' Circle, a position he held for the next decade.
While millions of Americans were hopscotching from one get-rich scheme (dot-com) to the next (house flipping), Tasch calmly shepherded $130 million over 10 years from angel investors into socially responsible companies. In 2009, Utne Reader included him on its list of 25 visionaries who are changing the world, affectionately calling him a "free-range capitalist."
'Let's roll up our sleeves'
Not coincidentally, Tasch's Slow Money was released near the end of a particularly financially bruising decade, one that started with Enron's massive deception and the dot-com bust and ended with Bernie Madoff scamming investors and sub-prime lending giants like Lehman Brothers torpedoing homeowners from coast to coast.
For agriculture, the subject of Tasch's book, the first decade of this new century was especially bipolar. While appetites for locally produced food enjoyed manic growth, agricultural production in America had paradoxically further tightened under the control of a few major corporations.
In February 2009, a few months after the publication of Slow Money, Tasch was in Madison for a book-release party. It was a snowy evening, and he held an informal reading at Rainbow Books. Among the handful in attendance was Grant Abert, who runs the Kailo Fund, a private philanthropic and investment company.
Tina Frailey, who represents the Kailo Fund, recalls Abert's reaction: "How do we make this happen? Let's roll up our sleeves." With that attitude, Abert helped form Slow Money Wisconsin, a group that seeks to establish mechanisms for translating consumer demand for local food into investment opportunities.
But Abert and Slow Food Wisconsin aren't alone. Four other regional chapters formed in the afterglow of the book's release - in Vermont, Texas, California and Washington. In September 2009, the Slow Money Alliance hosted its first national conference in Santa Fe. Some 400 growers and investors attended - including at least two representatives from Wisconsin, Abert and a local attorney-turned-butcher.
Meanwhile, the idea had begun blipping on the mainstream media's radar. Business Week called it a "big idea for 2010," and Time Magazine asked whether "slow investing" could "remake America's food system."
At the Slow Money Alliance's second conference, held last June near Burlington, Vt., attendance doubled, and nearly $2 million was raised to invest in eight "small food enterprises," from an organic Vermont dairy bottling plant to a California company that converts property to organic farmland.
That same month, the Slow Money Alliance hired Ari Derfel as its new executive director. "It was time to take [Tasch's] philosophy and put it into action," explains Derfel, in a phone interview from Berkeley. "I was hired to rally people." [This paragraph was amended from the print version of this story to correct an error.]
A New Jersey native, Derfel is a 1995 graduate of the UW-Madison. After sweeping through graduate programs at Georgetown and Harvard, he landed in California, where he and another UW-Madison graduate in 2001 launched an organic catering business, a novelty at the time. Two years later Derfel started Gather restaurant in Berkeley, a model for Slow Money success: It serves only local food and wines, was built entirely with local materials and, importantly, was launched with $2.5 million collected from 100 local investors.
"We sold it as 'Sure, we hope that you make money, but also you should consider the jobs that you create, the local farmers that you support and the watershed that you're helping repair," relates Derfel. "People want to invest in things they can feel, see, taste." Last year, Esquire named Gather chef Sean Baker the nation's best.
Derfel is charismatic and speaks confidently about bringing Slow Money principles to the mainstream. This year, for example, he will move the third national conference from the progressive outposts of Santa Fe and Burlington to San Francisco. Derfel readily admits he is moving the idea closer to Silicon Valley's deep-pocketed investors.
"Our goal is in one decade to get a million Americans to invest 1% of their paychecks," Derfel says.
If that sounds like a P.T. Barnum pitchman, consider not only Tasch's 20-year track record in rallying tens of millions from investors to sustainability-minded businesses, but also the wild growth that local food has recently enjoyed. The first CSA started in America in 1986 in New Hampshire. A decade later, there were 600 nationwide, and by the time Barack Obama was elected president in 2008 that number had mushroomed to 4,000.
Or consider that in mid-January, Wal-Mart, the world's largest grocery chain and leading seller of produce, announced a new goal: to buy 10% of its produce from local farms by 2015.
The importance of place
Like other new ideas, the Slow Money concept is taking several evolutionary paths. In Austin, the approach has been purely Texan, with bullheaded proponents holding weekly meetings and packing City Hall to lobby for new regulations. The Pacific Northwest has been more gentle, handing out micro-loans to dozens of artisan companies.
Slow Money Wisconsin has taken a distinctly Midwestern approach: holding small meetings and looking for consensus. But now it is ready to launch, and Slow Money proponent Bartlett Durand, president of Black Earth Meats, is convinced the Wisconsin format will become a leading model. The group will soon begin looking for an executive director and hosting "boot camps" for investors and producers.
"Wisconsin is ideal," asserts Durand, ticking off reasons. The state has the most CSAs in the country; Dane County is home to the nation's largest producer-only farmers' market; and there is a long history of farmers' co-ops in the state.
Durand points to the success of Willy Street Co-op, which recently opened a second store in Middleton, and Organic Valley, headquartered near the Kickapoo River, a two-hour drive west-by-northwest from Madison. Since its launch in 1988, Organic Valley has grown into a major player, distributing organic dairy and eggs from 1,300 family farms and generating more than $500 million in annual revenue.
(Durand neglects to mention perhaps the state's most enduring example of community investment: the Green Bay Packers. In 1923, the football team incorporated as a nonprofit, eventually raising funds by selling stock to local residents. The Packers remain the only community-owned franchise in professional sports.)
A Tennessee native, Durand grew up understanding the importance of place. "Memphis," he says, "is really all about Elvis and barbecue." But that type of prideful regionalism waned through his childhood in the '70s and '80s, especially as fast-food chains like McDonald's multiplied.
"If you are a chain," says Durand, "you don't want one menu in the eastern region and a different one on the West Coast."
He recognizes the importance of food in structuring family and community, noting that our most important holidays center on meals, like Thanksgiving dinner and July Fourth barbecues. Durand attended the UW-Madison in the late '80s, where he met his wife and, surprising for the current manager of a slaughterhouse, became a vegetarian, a dietary lifestyle he followed for the next 15 years.
Four years ago, Durand was working in Hawaii as a civil rights litigator ("good-guy stuff," he assures) when he and his wife decided to return to Wisconsin. They had a young son and were drawn to southern Wisconsin for its recreational opportunities, schools and especially the richness of food varieties. They moved to Black Earth, where Durand's father-in-law owns Otter Creek Organic Farm.
Two years ago, Durand bought a fledgling butcher shop and has transformed it into the region's lone independent processor and distributor of locally grown, grass-fed beef. "Cows come in the back door," he says, smiling, "and steaks come out the front."
But that wry explanation undersells what Black Earth Meats has accomplished and the essential support it provides to southern Wisconsin farmers. Durand works with local, small-scale ranchers who grass-feed their cows and humanely treat their pigs, and in turn supplies meat to the bulk of Madison's high-end restaurants.
Without Black Earth Meats, it is likely that small-scale ranching would vanish from southern Wisconsin in the near future. Sure, individual farmers could broker deals with individual restaurants, but that is a complicated and time-consuming exercise. Farmers practicing ecologically sustainable and humane farming need processors and distributors like Black Earth Meats to survive.
Durand sees the Slow Money principles and investment practice as an efficient way to preserve and rebuild southern Wisconsin's small-scale meat industry. Or, as he puts it, "We have this big idea, and now it is time to make it go."