CDFA Defining the Food System Asset Class

Since 2018, the Council of Development Finance Agencies (CDFA) has partnered with the W.K. Kellogg Foundation (WKKF) to build a national foundation for food systems financing. Across three rounds of funding, CDFA has conducted groundbreaking research, developed national tools, delivered local and regional technical assistance, and convened practitioners working to increase access to capital for food and farm entrepreneurs.

From 2018 through 2019, CDFA received its first round of funding from WKKF for the Defining the Food System Asset Class project. The premise of this project was to suggest and then prove that, if organized and defined properly, the food system can become an asset class worthy of traditional investment. Throughout these two years, CDFA engaged in intensive research, data collection, and relationship building to determine how development finance agencies can become more engaged in developing localized food systems through traditional finance approaches - such as bonds, tax increment finance, tax credits, revolving loan funds, and more.

In 2020, with a second round of funding from WKKF, CDFA developed a program to continue and expand the Defining the Food System Asset Class project. This program sought to deploy traditional financing tools to help build the necessary data, impact metrics, and portfolio performance measures to prove the viability of food systems as a distinct asset class. Through this work, CDFA partnered with communities across the country to develop plans and direct projects that create well-paying jobs in low-resourced communities, increase access to healthy food for children and families, and unlock capital and resources for food- and agriculture-related businesses that serve and are owned by people of color. Subsequent WKKF funding enabled CDFA to advance this work through pilot technical assistance, national training, and deeper engagement with practitioners, setting the stage for an even more ambitious third phase.

With support from a third round of funding from the W.K. Kellogg Foundation (WKKF), CDFA continued to advocate for Defining the Food System Asset Class by building on previous efforts to increase opportunities and leverage existing capital to support local and regional food systems. Educational trainings, pilot projects, strategic planning, and other networking events have helped CDFA learn about what communities, development finance agencies, and food systems leaders need to improve equitable access to capital for food- and agriculture-related businesses and projects.

The most recent phase of support from the W.K. Kellogg Foundation allowed CDFA to significantly expand the reach and impact of its food systems finance programming. CDFA launched the CDFA Food Finance Portal, a comprehensive, public-facing platform dedicated to food system financing. The portal houses searchable tools, program models, case studies, technical guidance, and resources for entrepreneurs, lenders, policymakers, and ecosystem partners.

CDFA established an Annual Five-Part Food Systems Finance Webinar Series that provided in-depth training on capital access strategies, blended finance, federal funding alignment, infrastructure investment, evaluation frameworks, and other critical food systems finance topics.

Each year, CDFA continued to support governments and ecosystem partners by developing customized food system finance landscape maps, market assessments, and strategic finance frameworks. Recent engagements include: New Mexico, Minnesota, Western New York, and the New England Region: Maine, New Hampshire, Massachusetts, Connecticut, Vermont, and Rhode Island. These efforts help communities identify financing gaps, evaluate existing programs, and design long-term capital strategies that expand access to flexible, affordable, and patient capital for food and farm businesses.

Recognizing the need for flexible, patient, and affordable capital - CDFA advanced the design of an innovative loan guarantee program model tailored specifically for food and agricultural enterprises. This model is intended to unlock new financing opportunities by reducing risk for mission-driven lenders and improving capital access for emerging, small, and undercapitalized businesses throughout the supply chain.

Ongoing support allowed CDFA to continue engaging the Food Systems Finance Advisory Council. The FSFAC brought together lenders, CDFIs, DFAs, investors, policymakers, TA providers, and nonprofit partners to share resources and innovative financing approaches, discuss emerging food systems finance challenges and opportunities, strengthen cross-sector collaboration, and support advocacy efforts to expand capital access nationally.

For the past three years, CDFA also curated and published a monthly Food & Agriculture Newsletter highlighting federal and state policy updates, new financing programs, funding opportunities, market insights, and practitioner resources for stakeholders across the food and agricultural finance ecosystem.

Through multiple rounds of support from the W.K. Kellogg Foundation, CDFA has helped establish food systems finance as a recognized and investable field within the development finance industry. By building knowledge, creating national infrastructure, supporting on-the-ground projects, and convening a committed network of practitioners, CDFA is advancing financing solutions that strengthen local food economies and expand opportunities for food and farm entrepreneurs nationwide.

-Food Finance White Paper Series

-Food Systems Finance Webinar Series

-Food Systems Finance Pilot Projects

-Food Systems Strategic Finance Planning

-Food Systems Finance Advisory Council (FSFAC)

-Food Systems Finance Resources & Newsletter

-Additional CDFA Food Systems Finance Initiatives

The CDFA Defining the Food System as an Asset Class project was prepared by the Council of Development Finance Agencies using grant funds from the W.K. Kellogg Foundation. The statements, findings, conclusions, and recommendations are those of the author(s) and do not necessarily reflect the views of the W.K. Kellogg Foundation.