205 Stijn Markusse - Raising €4M in 72 hours to scale boring distribution and storytelling

A conversation with Stijn Markusse, founder of Boerschappen together with his partner Stéphanie Vellekoop, about distribution, packing boxes, telling amazing stories, paying the farmers' invoices on time, and making sure you also do that in 2-, 5- or 10-years’ time so that the farmer can invest in long term regenerative practices.
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Chapters

• 2:50 Why are you doing what you are doing? Why Soil?
• 36:40 How he raised 4m in 72 hours?
• 49:52 What should smart investors, who want to invest in regenerative agriculture and food look out for?
• 1:04:25 If you could wave a magic wand and change one thing in the agriculture industry from a sustainability point of view, what would it be?

Transcript

SPEAKER_02: 0:00

Is it all about storytelling plus really good distribution and meeting your customers where they are? We talk on this podcast about how to help more farmers in their transition. But unless someone buys from them and pays their invoices on time, and more importantly, making sure that they will also do that in 2, 5, 8, 10, 20, 30 years, the farmer cannot invest in long-term regenerative practices. So how do we do that? How do you commercially build a large company which picks up the fresh produce from a farmer and gets it to your kitchen in 12 to 24 hours later by being really, really good at the boring stuff, distribution, packing boxes, etc. And by being amazing at telling stories. Learn why it makes so much more sense to raise investment money to grow and scale from your customers. Mind you, 4 million euros in 72 hours and why it's all about the happy flow. This is the Investing in Regenerative Agriculture and Food podcast, investing as if the planet mattered, where we talk to the pioneers in the regenerative food and agriculture space to learn more on how to put our money to work to regenerate soil, people, local communities and ecosystems while making an appropriate and fair return. Why my focus on soil and regeneration? Because so many of the pressing issues we face today have their roots in how we treat our land and our sea, grow our food, what we eat, wear and consume. And it's that we as investors, big and small, and consumers start paying much more attention to the dirt slash soil underneath our feet. To make it easy for fans to support our work, we launched our membership community and so many of you have joined us as a member. Thank you. If our work created value for you and if you have the means, and only if you have the means, consider joining us. Find out more on gumroad.com slash investing in RegenAg. That is gumroad.com slash investing in RegenAg. Or find the link below. So welcome to another episode today with Stijn of Boerschappen who brings the consumer and the farmer together in the Netherlands. and specifically focused on the regen transition, which is something that I love to unpack today with Stijn. We are in person, so you might hear some background noise left and right. We're in a very special location, which used to be a disco and now is a co-working space for all kinds of innovative, regenerative and sustainable companies. And I'm here in Rotterdam next to the river. So just to set the scene, Stijn is here with me and I'm very much looking forward to unpack Boerschap, the funding that you just raised in a very innovative way. And of course, there long-term plan in helping to transition as many hectares and farmers in the Netherlands as possible. So welcome, Stijn.

SPEAKER_01: 2:50

Thank you.

SPEAKER_02: 2:51

And Boerschappen is not a start-up, start-up as in you started it last week or two years ago, a year ago with a nice presentation. This has been a few years in the making. What triggered, because this was before a lot of this short value chain or value web companies popped up. This was, you were early on the curve. Like what triggered the focus on bringing food from let's say, good producers at that point. I don't think Regen was a focus yet to consumers, to people that want to buy it. What was the trigger for that? Because you didn't grow up on a farm.

SPEAKER_01: 3:23

No, although my grandfather, he was a farmer. So, first of all, it's important to tell that I was a marketeer. I graduated as a marketeer and when I graduated, I founded a marketing agency and I worked for brands that are and now a little bit of my opposite, brands like Red Bull or Starbucks. And so... But you learned the tricks. I learned the marketing tricks, yes. So we had a marketing agency and we were specialized in the millennial focus group at that point, 15 to 30 years old. Now they became a bit

SPEAKER_02: 4:04

older.

SPEAKER_01: 4:05

Yes, exactly. No, no, no, no, no. In 2008, I met Stephanie, my wife, and she's also my, well, my wife, my girlfriend, but together we have three little children. We met in Cape Town. and there we we got into a relationship and after that I founded my marketing agency in 2008 and in 2013 Stephanie was suffering from a bacteria in her stomach and she had to stop eating sugar and so we started to read the what's it called the literature the books no we started to pay attention to the packaging and That was a difficult one. So, on the other hand, I was selling this stuff to people.

SPEAKER_02: 4:55

Wow, so you basically were checking the ingredients of this Same or similar products of companies. Exactly. And so

SPEAKER_01: 5:01

in 2013, we started reading the packaging and then we thought this is not going well. 80 to 90% of the processed food was the wrong choice for the stomach of Stephanie. And so we thought, let's eat organic food. Organic food was, at that point, it still contained sugar. It still contained the ingredients we didn't want. But from an organic background. Let's say the stomach of Stephanie didn't care. Exactly. And so we thought, let's start collecting groceries in the neighborhood. And so we invited 10 friends. And... Those 10 friends are still our customers and still our friends.

SPEAKER_02: 5:49

So instead of going yourself, why did you decide to invite 10 friends? Just to make it more efficient. Like we go anyway, let's also pick up stuff for you.

SPEAKER_01: 6:00

So on a Saturday, we started to drive amongst 10 to 15 farmers in the neighborhood. At that point, it was just a social experiment. We were just trying to organize our own groceries, still while working for companies that didn't matter so much. So it was a little bit of a... When did your marketing brain click? 2015. Oh, well, that was... Whoa. It was funny because I was on the way to Austria. I also had a large event in the French Alps, like a festival. And at one point I was on my way to an expo in Kitzbühel and we were in a paper with our little plan, with our little, and in a few hours, 100 to 200 people just subscribed. Well, subscribed, they sent an email. Our software was Excel, Excel, so... While arriving in Austria, Stephanie had a full mailbox. And it was, I think it was March of 2014. And then we thought, okay, well, we are not the only ones who want to source from local farmers. And that was at the beginning. So we hired Miranda. Miranda was our first employee. My father just got retired. He grew up on a farm. We bought a van. And we started. And so in 2014 we had a little company with two or three hundred customers and we collected the stuff and people came up and they paid and still we were managing the whole process in Excel. So it worked. Our social experiment worked. And then my marketing brain kicked in. Why not scale up?

SPEAKER_02: 7:54

And so we did. And just to paint a picture, we're now at the end of 2022. So about eight and a half years later, or eight plus years. You said, and so we did, we scaled up. How do you describe Boerschappen now? What's the current status? I mean, you no longer have one van and you no longer have your own, let's say, shed to collect the stuff and mix it and you no longer manage it with Excel. Currently, what's the size of the company or what should people imagine when they hear Boerschappen? Oh, this is a nice, small, local... value chain player, it's slightly bigger than that.

SPEAKER_01: 8:41

Yes, so the little romance of the company is a little bit gone. We now have a very state-of-the-art building, very boring, state-of-the-art, new build, concrete building with very large, cool infrastructure. It sounds boring and it is because at this point we have approximately 60 people working in the company. We have approximately 10,000 consumers that are not on a weekly base but on a regular base buying our boxes. We just launched, we made of our company, we made it into a corporation. At this point, we have a-

SPEAKER_02: 9:17

Cooperative, yeah, sorry, no, a corporation. Exactly, cooperative, yes. So not a multinational, it's a cooperative, just here, which in Dutch becomes a corporation very easily. Thank you. So it becomes a serious player, like the 60 people, 10,000 plus

SPEAKER_01: 9:31

regular customers. Yes, exactly. from the government to feed the people in prison. So at this point, we invested a lot of money in a new data platform, in new IT, new fulfillment, new last mile distribution. And so at this point, we are ready to scale up again. So I think we just left the valley of death to keep it in perspective in the economic way. We are now ready to scale up. An important phase for us So the whole romantic... Let's see, the romantic image of the company is also a threat, so we want to use data to prove that we are doing the right things. At some points, we just don't know what is good. We are vulnerable in a way that we also don't know what should be the focus for the next 10 years. The only thing we know is that we should focus on nature. That is the biggest angle we have to focus on. the largest point we have to focus on. But still, we are not the smaller company. And so we have to build the processes. We have to build in the data that supports our marketing tricks. Because in the beginning, we could easily say, we are okay. We do the right thing.

SPEAKER_02: 11:08

It's local, so it's good.

SPEAKER_01: 11:09

Nobody asks questions. No. And still we do the same things. But at this point, we have to prove we are doing the right thing so data is a really big part of our company now doesn't sound romantic

SPEAKER_02: 11:24

it's not you and Stephanie anymore on Saturday with a second hand van go around to all the farmers pick up the things and it's fine it's probably better it's

SPEAKER_01: 11:33

for sure better in terms of impact we at the beginning we wanted to be in Holland we have a saying the luis in the pels yeah we wanted to be let's say

SPEAKER_02: 11:41

the how do you translate that the annoying one that It shakes up the system. The establishment. But usually it's like the activist shareholder. Very small, but still making a

SPEAKER_01: 11:52

change. Yes, and that sounds a little bit negative. So what we wanted to do is to show that it is possible to make a value. Alternative system. Exactly. And a happy one. So with happy customers, happy employees and happier farmers. In the meantime, it's sometimes difficult. It's a bumpy road because it's an empty road. It's empty and bumpy and lonely sometimes. It's empty and

SPEAKER_02: 12:16

full of crashed previous companies trying to do similar things. There are a lot of skeletons. Lots of skeletons. There are a lot of crashed cars or crashed boats or whatever, like wreckages that you have to deal with. And so a typical customer, what do they buy at you? Is it mostly fresh? mostly packaged goods. Like what's the typical, you do most of your shopping through Boerschap if you're a customer?

SPEAKER_01: 12:45

Well,

SPEAKER_02: 12:45

people

SPEAKER_01: 12:45

usually eat about approximately three to four days for the evening meals. So it's kind of a meal kit in several varieties. So we have a seasonal box in which you have like a summary of season. On the other hand, we have the easy boxes, a little bit of the hella fresh kind of boxes. So it's all the ingredients for a recipe, three in a week. In all those kind of specifics, we have like different varieties. For example, a vegan, a vegetarian. We also have customers who only eat meat and fish. And so we try to fit to as much consumers as possible so there is no reason to say no. So our customers buy our boxes approximately 30 to 40 times a year and still they go shopping in a supermarket because we only provide them with food for a dinner. And on the other hand, we sell them special boxes like Christmas boxes, like Easter boxes, like special meal kits for several occasions.

SPEAKER_02: 14:08

And in terms of quality, and I think most importantly, actually freshness as well. And with you, the speed is really, really important, right? The speed from the field to my kitchen table. In 12 to 24 hours. It's there, which just to give a perspective, a normal supermarket broccoli, how long could that take? I think

SPEAKER_01: 14:28

a broccoli would be

SPEAKER_02: 14:29

fast,

SPEAKER_01: 14:31

two, three days. For example, in our company, every morning we collect the groceries directly at the farmer. They arrive in the company, they get processed throughout our fulfillment system and it will be released in the kitchen that same evening. So this morning we visited three to four farmers. Last Saturday we collected the stuff that are not fresh, such as onions or carrots, And tonight people can cook. For us, it's the most simple and easy company from outside. It's complicated, but we have a very good relationship with our customers. They know exactly in advance when we will arrive, how many, for example, leaks we come and collect. And so we have a very predictable company. One week in advance, we know exactly what to produce. And

SPEAKER_02: 15:24

also with the farmer, you sit down and, because now we're going to get the region piece, of course, you're going to sit down in advance, look at what they're going to produce next year or next season. Happening now. You're sitting exactly, of course, now. Okay, what do we need? We know how many broccolis, we know how many leeks, we know how many onions, we need week by week, more or less.

SPEAKER_01: 15:45

Yes, we know our sales path, so we know at this point, since we started with the new IT architecture, we have a very good yield management, so we understand how many money we put in marketing how many boxes we probably will have in September so with our farmers we will make like a plan we just started sowing in the beginning of January let's say depends on the crop and we harvest what we plant so which

SPEAKER_02: 16:21

is amazing for the farmer as in terms of an offtake agreement like they know what happens if weather doesn't cooperate you find it somewhere else or that Then it becomes, it's very predictable, but then, of

SPEAKER_01: 16:31

course, the juggling starts. Depending on what it does. So, for example, if we have hail in the, let's say, we have a farmer, so we ask him if he has hail, make a picture of the damaged crop. Three months later, when the pear is ready, we want to communicate what happened three months in advance. And people will understand why the scars are on the pears. And they like the scars because they understand understand what happened. So we are not working with a first price, first class, second class. You buy everything. We buy everything what is available. We buy a kilo of apples and the sizes, we don't care. How nice is that for farmers to work with you? If they have a problem on making it a picture when it heals, it's a deal. Yeah, but that's fixed. We sell stories. We sell the company of the farmer. We sell We sell the effort he does. We sell the adventures he has. We sell the beautiful images. I

SPEAKER_02: 17:37

remember a story of flooding and cherries, I think, in Limburg, which is in the south of the Netherlands. Flooded two, three years ago? When was it? Two years ago. And one of your farmers got fully flooded with a lot

SPEAKER_01: 17:49

of cherry trees. He was not even a farmer of us. We just helped. We just helped. So we know that our customers want to do the right thing. The only thing they don't want is to have a lot of troubles. Efforts, barriers, it

SPEAKER_02: 18:07

needs

SPEAKER_01: 18:08

to be smooth. Smooth, exactly. So what our job is, together with our farmers, is to make just an easy way. But there can be a lot of problems in the easy way. But these are not a reason to not buy the stuff. I am convinced that if we can tell the stories of the adventures of our farmers, people will even like the product more because they know it's a real product with some damages. So what happened to the cherries? We sold them. We made a

SPEAKER_02: 18:41

very sour juice. Which is not true. It's dying after me. I tasted the juice. It's not that sour. It's

SPEAKER_01: 18:48

actually nice. It's a kind of a cherry. You need to

SPEAKER_02: 18:51

like it. You need to like it. But they sold a lot of bottles of cherry juice. Exactly. But people... Which

SPEAKER_01: 18:56

saved them because they couldn't sell the cherries as cherries anymore. And we have a large company and the people want to help. And so it's just a happy flow. A happy flow started from a problem of a farmer, but everybody understands that a farmer should be helped.

SPEAKER_02: 20:01

And so when did the soil focus, I mean, it was always soil focused, but do you remember when regenerative or let's say soil focused farming started to pop up in your conversations or maybe in your reading or in your work? or do you remember, was it a slow process? Was there a moment that you're like, whoa, this is, or when did your marketing rate go in? Well,

SPEAKER_01: 20:27

we started in 2013 because we wanted to buy food which contained something which didn't contain something. To strip away something because otherwise Stephanie would have a problem. In 2016, we were thinking about what should be in the product instead of not being in the product. So we were thinking about a nutrition

SPEAKER_02: 20:51

which is going beyond organic because organic for many people I mean it has a whole but if you look at the definition it's a lot of inputs you don't use different seeds for sure but it's a lot of what is in there of course there's still organic sugar which is a problem for your partner but and then going beyond and say okay what is actually what is the nutrition 2016 that's early for nutrition early cases

SPEAKER_01: 21:13

and then again a few years later I think it was 2008 In 2018 we were thinking about what should not be in the process. So the chemicals. And therefore, with every year we grew, we read, we were working on the company, we started to learn. And everything we learn is also directly a sign you don't know anything. So at that point, and soil was one of the main things, I think in 2015, on which we didn't understand how soil works. We only knew this is where our food comes from. But we were still surviving, surviving, surviving. We had no money. We hadn't money until January of 2022. So it was also, Just hope and trust the process, trust the farmer. We at that point knew that organic was not enough for us. So organic was a very good basis to lean on. On the other hand, we have lots of farmers that work in a different way, for example. Choosing not to be certified. Well, or a completely different way of farming. We have a pig farmer that uses his pigs such as sheep. So they ate in nature. So they couldn't be certified. certified because they are not inside. And so And so for us, the re-gen angle was really a good way because it's not limited to regulations of people in offices again.

SPEAKER_02: 22:59

And now that we're five, six years further, and you have a bit more peace of mind, let's say, in terms of the company, you're definitely out of the super early stage, maybe out of the valley of death, but let's see, let's talk in a year. It's always seemed that you're out and then you're not. What do you see the whole soil focus and regen focus for you as this seller or teller of stories at the end? What do you see there?

SPEAKER_01: 23:30

For us, it's I think the most crazy opportunity to go full forward on focusing on soil. And for example, people want, I believe people want to do the right thing. but we have to fit their needs, we have to fit their household. In 2013, the Gen Z born between 1995 and 2015 is the most economic, the most wealthy generation. Which is like tomorrow, basically. Yes. This group is focusing on regenerative companies, not circular, not degenerative. So if you want to be... if you want to have the advantages of this Gen Z. I was a generational specialist a few years ago. This was your thing. This was my thing. We see it as a major, major, major opportunity to fit their needs in 2030. So we have basically three zones in our mind. So we have the next 25 minutes. Important because people cook approximately 25 to 35 minutes. Short term, tomorrow, packaging, eating, be happy, order a next meal. for the next week. The next focus is 2030, mainly focusing on a chemical-free chain, making no damage to soil, air, water, biodiversity, and name it, people. The next focus is 2121, 99 years from now. Our company still should be doing the same. It's, what's it called? It's It's... The

SPEAKER_02: 25:21

mission is locked. It has a mission lock. And it will be doing similar things, maybe not exactly the same. I mean, there's a long...

SPEAKER_01: 25:27

Our mission is locked. Your mission is locked. The company cannot be sold anymore. So we see that complying with nature is the only way up. The only way up. And we see our consumers shifting from not making less damage but making profits, making, making, making, making things better. And therefore, the stories that come with these, the stories that come with these, these stories that come with focusing on nature are extremely fun to watch. Is that your

SPEAKER_02: 26:09

marketing brain, like going ballistic when you see, compared to a sustainable story, which is sort of keeping things the same and not doing more damage and a regenerative story.

SPEAKER_01: 26:19

It's a happy flow. It's a happy flow. It's fulfilling. So we at this point we made a data platform in which we can offer content to the right people in the right way on the right moment. So if we can show people all the stories that our farmers are going through and it's happy because it's more diversity, more animals, more better products. It's More beautiful. More beautiful. We, at this point, I see in my generation, we have a shortage on nature. Extremely. So we try to make nature on our screens. We try to make nature in our clothing. We try to make nature in our concrete habitat. But people want, I think people want to be part of the happy flow. And the happy flow is, in my opinion, not the organic flow. It's the regen flow. And what

SPEAKER_02: 27:21

does that mean for the farmers, like the ones you work with now and the ones you're going to be working with over the next decades? How deceptive or how interested are they in transitioning further or in that journey together with you? Because I can see you, of course, see the huge marketing potential, the story potential, the customers, of course, if it's better quality, if I'm already in the happy flow with you and I want to continue that. But what about the side of the farmers and the ones you're working with now? Are they interested in continuing that dance with you and continuing to improve and to increase biodiversity, et cetera, et cetera?

SPEAKER_01: 28:00

Well, I think it's a matter of confidence, and that confidence often come with money. So I see the chain we are building with happy customers, happy middlemen, happy farmers is just, it sounds too good to be true. But it could be that it's a very easy, it has an easy approach. So if we can make sure that we pay the right invoices at the right moment and the products are ready at the right time, we can tell the right stories on the right moment to the right customers, on the right moment. The only thing that has to happen is the transport. Because people have to eat. And we know that our customers are willing to pay the money they pay because we have a very open way of calculating. So we can spend lots of money of our revenue on products. And my farmers, they are willing to produce in a way, but they need to have the confidence they have the right invoice.

SPEAKER_02: 29:20

Which means you need to promise to buy and promise to pay on time and promise to pay the right price and not say, ooh, This hair doesn't look pretty anymore. I don't want it. Which is what most farmers are used to now with their normal buyers.

SPEAKER_01: 29:34

Yes. And so in my company, there are farmers where we spend approximately 70% of their revenue. It's with you. Yes. So you're very important. For them. Yes. I also have farmers and I spend 5 to 10% of their revenue.

UNKNOWN: 29:50

Okay.

SPEAKER_01: 29:51

This is all a matter of volume. So if I can guarantee a piece of turnover and they have the confidence that I will pay not only next year, but in five years or in the next 10 years, we can make something happen. But it's difficult because this is all a matter of confidence. And so we should try in a whole food chain. We cannot, if we want to be authoritative, investing in the regen agriculture. Our focus should not be on the next year or on the next three years or next five years. We should talk in decades.

SPEAKER_02: 30:33

And that means you need companies like yourself that are out of the valley of death, that don't disappear tomorrow or the day after. Because for sure, farmers have seen that many times. People promise them stuff, maybe pay the first invoice, maybe the second, and then they disappear because they run out of money, energy. It happened too much.

SPEAKER_01: 30:50

So in my company, It's all about a consortia. So now I want a large contract for the next eight years, a government contract, eight years. We can do a lot in eight years. But what happens next?

SPEAKER_02: 31:09

My customers- Because if that contract, like to the prisons you mentioned, goes to somebody else after eight years, means your farmers went on a journey and then you need to be able to absorb that. Probably. In eight years, nine years, 10

SPEAKER_01: 31:21

years. Yes. My company should be, my company, the only, and that is the reason why our funding stopped last year, a year ago, because we don't have an exit strategy. Exit strategies in companies like mine are just the enemy of region agriculture. Because we cannot talk in five to eight years anymore. If we went to- We have to

SPEAKER_02: 31:48

talk in decades, and that means it doesn't fit with funds, it doesn't fit with, so you were looking for money, but the traditional route, even the traditional, between brackets, I'm doing brackets, but nobody sees that, brackets, impact route, impact funds, et cetera, was impossible because he said, we're building a machine here for an organism and ecosystem for decades. Exactly. And you still were running out of money. So you needed

SPEAKER_01: 32:12

money to build this fancy, new, boring building. Exactly. And this fancy data platform. Exactly. So we are not funding my own company. We are funding the chain behind it. my company. And so in my company, approximately 63, 64% of my revenue is spent on products. So every euro I make on the front is 64 cents on the back. And

SPEAKER_02: 32:40

that goes straight to farmers? Straight to farmers. Processing, etc. is not even included in that.

SPEAKER_01: 32:46

Yes, it's included. Only I think 5 to 10% is processed So

SPEAKER_02: 32:52

50 plus percent of the euro in is euro out to farmer. Yes, exactly.

SPEAKER_01: 32:57

Massive. But most of my farmers, they process themselves. So they have

SPEAKER_02: 33:01

some cost to it. So then it's 60 plus percent.

SPEAKER_01: 33:04

Yes. So... But it's, so in that perspective, my turnover is really important in the chain. So if we can grow, we have the ambition to grow to 100 million in 2030, means we can spend 64 million euros on who? We have power, and power can be used for money purposes or for purpose purposes. And so our company is focusing on purpose purposes. So with a power of 64 million, hopefully in 2030, we can make the Excel files of our farmers right or wrong. So therefore, we have, I think, an important position in the chain. On the other hand, everybody has the same position because if my customers say no, I have no turnover. If my farmers say no, I don't have a product. So we have like an equal level of play. field in which we have a little bit more of opportunity to choose whoever we want to be involved in our company. In that matter, we have to think who fits our company and how are we connected for the next 20 years. For example, we are now, you know, a regen farm here in the Netherlands. Before the plants went into the soil, we already gave of commitment for the coming years.

SPEAKER_02: 34:38

Which is a lot of agroforestry actually, which is fundamental because it can take a number of years plus more before there's any yield on any tree. And that's quite a, that's a period. I mean, there are financing schemes we've had propagate on the podcast and it will come back soon. But it is, yeah, especially fine. It's a finance question and an offtake question of you say, okay, whenever those trees are ready, whenever they're yielding, we'll be there too. But you need to be thinking five, six plus years.

SPEAKER_01: 35:38

Yes. So the first step, they started giving this year. But it's also an experiment for us. So how can we play a role in kickstarting these things? Therefore, we are like a magnet for the younger guys, the 25, 27 dreaming farmers. They probably all watch The Biggest Little Farm. And

SPEAKER_02: 36:03

Kiss the Ground.

SPEAKER_01: 36:04

And Kiss the Ground, of course. But these kind of farmers are really important to us because to together with them, we can start building chains in which we can have the advantage in 2030. Because if we want to harvest Regen products in 2030, we have to start now.

SPEAKER_02: 36:24

Yes, but I'm going to get emails if I don't ask. So you needed money to build these facilities, to scale, to get out of the valley of death, because after a certain level, you just can't do it anymore. obviously on Excel and obviously on like a packing station that's not really optimal, but you couldn't go to traditional. I think banks were impossible in general. Impact funds were just too short focused. You went to the crowd or you went to the general public,

SPEAKER_00: 36:55

which

SPEAKER_02: 36:57

didn't go bad. Like that went really fast. Tell us a bit about that funding decision, first of all, to turn a company into a cooperative, but also then to really open it up to almost anybody to invest and be part of that but with a very clear mandate or condition it will never be solved this is not a speculative investment this is decades in the making yes so

SPEAKER_01: 37:18

in in in march of 2021, I guess, there was a second year in COVID. And so we grew crazy. So we hired a new building. Our team grew from 20 to 50-year person. Our software was just crashing. We have somebody in the company, Sophie, and she was our only working API in the company. She was the connection between customers and farmers, and so. She was the API, basically. She was the API. Is she still there, and she's fine? She's still here, she's fine. Completely, okay. No, she will be our chief gut officer in January. She will be in charge of making sure the guts of my customers get on a weekly basis to write a produce, so. At that point, in two years, we grew about 500%. So we outgrew the value of death in two years, but we were just in the middle of death at that point because our cash flow was dipping. We had to do major investments. So we started talking with all the impact funds. We had the numbers. We had the skill. I think we had me and Stephanie. We were... we are not the typical, let's say, in Holland we say, geitenwolle sokken, people. Yeah, I would, how do you say, saving

SPEAKER_02: 38:53

the world,

SPEAKER_01: 38:54

trying to build a very cute company. We were the pragmatic, a pragmatic people who showed that it could work. So, we started talking with banks, investment companies, and, well, it started, and we had a corporate finance advisor, Stijn, and he helped us by making the a forecast. And at that point we had focused on two points. So we wanted to have somebody in the company who could help us with tech. We had to invest lots of money in tech and we made our software ourselves with the company, but we are not the typical tech people. And we wanted to have the people who would help us with the impact part. So we thought if we have a tech fund and, for example, a family fund, we have the right tech combination. tech guys to help us with tech, the impact by keeping our boat straight. And so we had a little consortium. And at the end of November, it started crashing because the tech firm, they had some problems with our absence of an exit strategy. So in the last week, so we did a commercial due diligence and they say, well, what is your plan, Stijn? 2021, 99 years from now. Biggest company in the Netherlands, making boxes, I don't know. And so selling, no, no, no selling. Okay, so our investment, what's happening? You probably can sell, but I will make a restriction to who? So not everybody, no, not everybody. So at that point, it was a year ago, 25th of November. And then it crashed.

SPEAKER_02: 40:50

Because they were not comfortable. Rightfully, I mean, it's not fits in their values mindset. But they, I mean, they could have said it slightly earlier or could have known a bit earlier. But the non-exit or non-speculative part meant that basically that deal was off the table.

SPEAKER_01: 41:06

Was off the table on a Friday. And we were not, Stephanie and I, we were not the ones who, we were not going to comply. No. And so it was a heavy deal. heavy weekend and so. Because you were still running out of money. Yes. And you had to make these investments and the software kept crashing. Yes, exactly. And Sophie had a burnout almost. Yes. And so, and so one, one of the, one of the parts in, in the whole, in the whole funding process was, was attracting people who used our

SPEAKER_02: 41:38

company. Yeah, because I remember talking to you at the time and you said we will go to the crowd at some point. Yes. We will, we want normal people, farmers,

SPEAKER_01: 41:47

customers, partners to be part of Exactly, but our ideal combination was tech, impact, people. At that point, the market and the valuation was incredible for our company. So the multiples were sky high at that point. There was just so much fuck you money in the market. So we had a very high valuation.

SPEAKER_02: 42:12

It's really interesting to think about a year later, that would never fly. No, we were lucky. The world changed completely in January, February. is not, I mean, is absolutely horrible. But the food dependency. The food dependency suddenly became, so actually your valuation should even be higher, but of course a lot of money deflated and exited the market. So you were very lucky, but you needed to do it fast because for sure you could see this, I mean. I didn't see this one. No, but many of you were, I mean, energy prices were going through the roof. Already in November, December, things were weird. And so what did you do that weekend? You put up a crowdfunding in a weekend, basically.

SPEAKER_01: 42:56

No, what we did, so one, we wanted to fund... out of three angles, people, impact, tech. And so because our valuation was extremely high, those companies, they wanted to have a 5% share in the company. So we didn't need the crowd at that point, but we already thought how to organize which tools. So on the Monday, we thought, okay, fuck it, let's go and make a cooperative organization. And so in six weeks, we, together with our corporate finance and the lawyers, we transferred the whole deal. We funded a corporation. A cooperative, yeah. A cooperative, so we went on a holiday. And the 14th of January, we started launching our idea. And in 72 hours, we funded four million euros. So we were honest, so we told them, we talked to banks, we talked to impact funds, We talked to everybody who is in this market with money, but we just didn't manage to get around at the right terms. At that point, we were still in a lockdown. People had extreme amounts of money, I think, in the bank. So they thought, okay, let's invest in the company. They couldn't go out. So we were lucky at that point. And so Stephanie and I, we just sold our shares and we put the money in the comp And that was the kick of money for new IT, new data, new fulfillment. So make the company ready for the pursuit of a 30 million revenue in 2025. And the rest is history. We started working just crazy. We did everything in six months, which normally should be one and a half year. And so the 7th of November, the whole a project that was ready and now it's ready for us to take some rest in the company. A Christmas is coming and at this last week we put a second round available because we are now still not a very, what's it called, a very leveled cooperative because we have still lots of shares still in our own company. Yes, Stephanie and I. So in the coming years we have to sell shares to be like a real cooperative. And the money that comes out of these sales are invested in the company. So it's a very healthy way of funding your own company. And it's kind of like going to steward ownership. And you raised, I think, another million, almost a million. Yeah, 1.3 at the end of the week. And so it's one of our main focusing for, I think, 2025. Make the company of its own.

SPEAKER_02: 46:00

And did any of the tech people, because I know it's a group of, I'm going to say techies, but that's not the word, but they normally invest as an angel group, et cetera. Did any of them

SPEAKER_01: 46:11

join as well? Yes, yes. And he is now in my advisory board. So this was a very, very good tech fund, but a little bit shared interests. And so if people see me, they don't think this is... A guy that's not going to sell the company, not even to the highest bidder. So, because people think that I am quite a commercial guy, but not in this company. In this company, we see... we see lots of opportunities on doing the right thing because doing the right thing as mainly in the coming eight years is very attractive for a lot of people. And if they know these owners are not selling the company to a large multinational, but it will be as it is, as it is.

SPEAKER_02: 47:03

Yeah, but I mean, in a sense you're selling, I mean, we joined as well, just full disclosure with a few thousand where you're selling to your own customers as well, piece by piece to keep growing and getting 100 million and thus 64 million a year to farmers and thus I don't know how many regeneration and transition plans in the coming 8 years so it's also it's very commercially focused but with multiple impacts and like not just okay what's the highest multiple I can sell it to Unilever or whoever but what's the highest multiple I can send back to farmers and keep the whole flow build the biggest machine because you're

SPEAKER_01: 48:19

yes the machine the machine should be commercial because our commercial machine is our path to 2021. If people don't want to buy it anymore, we stop. So we have to understand this customer. So we were not held by any governmental help or subsidies, how is it called? We have to do it on our own. And therefore, every week, every day, every 25 minutes, we have to prove the company because otherwise it will be HelloFresh or a supermarket again. So we are not the easy choice for the consumer. So we have to tell them these stories. We have to tell them the adventures of our customers. And therefore we see this customer, this happy farmer, struggling and laughing, we have to tell them how it is. And therefore, this marketing tool, this data platform, this app, this communication platform is really important for us.

SPEAKER_02: 49:29

And what would you tell investors? Let's say we're in a theater, we do this in person. And what would you tell them? Of course, without giving investment advice, what would you learn? Like, what's your biggest lesson in this funding 12 months you went through now? What would you give them as like... get involved like focus on long-term what would be your main lesson learned to investors if you if you talk to a room full of people that want to put money to work and they've seen kiss the ground they they they're into the region

SPEAKER_01: 49:57

okay don't go into the impact funds so-called impact funds because they still have a window of five to seven years with a multiple of ten stop naming yourself impact it's crazy i was really angry i talked to every impact fund and it's it's just It's the same stupid exit window. Stop exit window. So what I would like to tell them, if a regen agriculture, if we want this to work, We still can talk in exit windows, but make it decades. And focus on traffic. Focus on stories, focus on... What do you mean on traffic? Traffic. Sales. Sales.

SPEAKER_02: 50:48

Stories, customers. Real

SPEAKER_01: 50:51

stuff. Real stuff. So in my opinion, that's what I mentioned a few minutes ago, these farmers, they will come. And the new generation, the 25, 26, 27 year old guys and girls, they don't want to be this farmer as their father was. Yeah, they don't want to be the sprayer. They don't want to be the customer of Syngenta. They want to be the customer of knowledge, of books, of inspiration. And so they need a customer that wants the same. The farmers will come. The farmers will come. The consumer is ready if it's smooth enough. We need to make traffic. We need to make sales. We need to make a revenue. So if we want to have the farmers in transition, we need to pay their invoices. Somebody needs to pay the invoice. Somebody needs to step into a van and collect this stuff. It's easy. It's the real economy. We need real economy. We need traffic. We need invoices. We need fans and happy people. And it sounds like a fairy tale. But it's a little bit, as my company acts now, we can only help as much as we have the power of the invoices so we can pay. If we can pay five to 10% of the harvest of the farmer, this is just what we can talk about. But if you do 70, then it's a different story. Yes,

SPEAKER_02: 52:29

exactly. So we see... So you would say help companies like yourself grow and get traffic, which means you get a bit more body, a bit more space, a bit more, you can hire a chief gut officer, which I'm curious about, and you can really shovel, quote unquote, a lot of money to farmers that want to change.

SPEAKER_01: 52:49

Yes, and so the money shouldn't go to farms, but to the middlemen with the right attitude, with the right focus, and the middleman is important at this point. But it's also a very difficult road, so...

UNKNOWN: 53:05

Sigh.

SPEAKER_01: 53:06

who should make the traffic. In Denmark, it's just they have the organic agriculture is really big in Denmark. But it came from a dream from the government. So they told their purchasers to start make different buying metrics. So in the province I live in, we have the ambition to grow 25% 5% of the farmers organically in 2030. Help me. How? And whether it's organic or a regenerative, it's equal for me. It's okay for now. Let's start

SPEAKER_02: 53:53

with something. Let's not fall over definitions and have endless discussions of 20, 30, 25%, which is farm-to-fork strategy, is basically yesterday. Exactly. Now, now,

SPEAKER_01: 54:08

now. In 27, the soil should be in transition already, so I don't know. I see too little people. I don't see them having a dream. And let's say a dream, I really don't understand, Koen, why we see this dream as a burden instead of a great, great, great opportunity. Because the consumers, they will be there. They only need to have a tool in which they can easily buy or purchase the stuff on a way that it's suitable for them, on a moment that's suitable for them. No, I'm laughing

SPEAKER_02: 54:49

because the dream if you go back to the tech people, that's usually what they invest in or they sell in. Like the crazy dream, which nine out of 10 times fails, which is fine because it makes sense in a model. And we just, we're going to conquer the world with this Airbnb or with this car or with this app. And somehow there it's fine to dream and to put a lot of risky money. Fuck you money, extreme. To work and most of it goes into a black hole and never comes back. And when we talk about the real economy, suddenly we're not allowed to dream. No,

SPEAKER_01: 55:21

and it's funny because when you see in every small chain a cooperative, it's a distribution and sales what is the bottleneck. But it's... Sales is step one, because a distribution in tech is

SPEAKER_02: 55:43

following. If you don't have sales, everything else stops.

SPEAKER_01: 55:48

If you don't have

SPEAKER_02: 55:48

stories, you

SPEAKER_01: 55:49

don't have sales, and if you don't have... Well, it's a way up. So in my company, we try to make a happy flow. And a happy flow is... At all times, we try to attract people who wants to be in the upward cycle. And so they have to be a customer or they have to tell a friend or they have to lead us to like a big contract or they have to introduce us to a farmer. They can come to our company. They come into our community and just being there by not being a customer, but you should do anything or something else. You should help. Add value somewhere. But it can be free. It can be just. just introducing a customer. So our company should be all about the way up. and not by saying the supermarkets are wrong. We want to be the company that has a solution for just quite a complex problem, but the usage of the company is quite easy and easy to do it next week again.

SPEAKER_02: 56:59

So how many of your customers, how much of it comes through others? How sticky are they? You said the 10 are still customers and the 10 original ones, how sticky are they? How sticky is that? Because it's extremely difficult to build, but once you've, we've seen it with other companies, I think Zappos is an interesting example, to do everything, Coolblue here in the Netherlands as well, some others, to do everything for the customers, smile, and they will tell. No, no,

SPEAKER_01: 57:25

no, no. The customer is important, but not that important. So we have, for example, we have a trout farmer, and he grows trouts in a national park. And these trouts, they come with a They have a head. So when we add them to our boxes, they come with a head as they swim. And some people, they get angry because they email us and say, this trout has a head. I say, yeah, well, that's how they swim. That's quite an essential part of the body of this fish. Okay, so how will we manage this? So here's a YouTube video. No, so I say, maybe you should stop. Because in three weeks, there will be another fish with a head. So we are not trying to, we have just quite a specific

SPEAKER_02: 58:17

product. But you're trying to help them. I mean, if they are like, would you have like, okay, what should I do with the head? Or if people are curious and in upward track, do you give them the tools or give them the nudges?

SPEAKER_01: 58:29

Of course, of course. The people that get angry because the fish has a head and they want to be the king or they want to be the queen. That's the end of the relationship. Exactly. Because I cannot help them on the long term. So what a Coolblue or what a Zeppels is doing, they make the consumer the king or the queen. We cannot do that because we have quite some restrictions in the company. We can only sell what's in the season. So at this point, it's now the beginning of December. It will be tough the coming four months because we have... We don't have the tomatoes. We don't have the peppers. We don't have the leaves. We just have the cabbages. We have the onions. Exactly. And so our added value comes in the composition of the boxes and in the recipes. And our added value is not that big in June because everybody can cook with a tomato, a good tomato. And so in our company, we want to have Like a flat line in everything. And so do they, do you see a dip in winter?

SPEAKER_00: 59:44

Of course we see a dip.

SPEAKER_01: 59:47

We see a dip. And I can understand. Myself, we have three kids. At the end of the week, they also want... They're done with the cabbages. Of course. They maybe want just a bean. And I can understand. We are quite a difficult company to follow 52 weeks a year. And therefore, we must understand that our added value is in the stories, is in the very high quality, is in the pursuit of making nature a little bit better. Freshness. Freshness, happy. Also be a little bit closer to nature, making sure that the bird of our company, for example, the complicateness. It's complicated. So we have to cover it with a good feeling and making sure that you take care of your body. So we have to tell them every day, every week from several angles. In June, it's easy to cook with season. But in winter, it's easy. This is what your body needs at this point. The season isn't there just randomly. The season is there because that's how your body is working. A communication is really important in our company. And we know that if we say the right thing at the right moment to the right people, we can keep people in the company and in the happy flow. But that's when you need tech again to tell them the right stories on the right moment. And then you need a marketing department. You need a guy who goes and makes these portraits. It doesn't come easy. No,

SPEAKER_02: 1:01:32

no, no. It's not that you can ask. I mean, you can ask the farmer to make a picture the hail damage on a pier, but not necessarily to document his or her full regenerative journey, because that's not his or

SPEAKER_01: 1:01:42

her job. And therefore, for a data, And especially the ag tech would be very interesting if we can use ag tech, for example, censoring on farms, which are directly connected to our app. And we can tell people how the soil is progressing while eating in winter. It could happen that our customers say, okay, well, I don't like the variety at this moment, but I'm still, we are working on something. And it's eight weeks from now and we have the tomatoes again. So keep suffering keep suffering but we have happy soil happy farmer it shouldn't be too easy it shouldn't be too comfortable there's a bit of suffering it's what we lost it's too easy so we the only thing we have is the easiness of food at this point so we should it's the same as stopping with drinking it's easy if you stop if you have a substitute so if the comfort of the of the tomato isn't there anymore. We have to put something else in that. The comfort of the story. The comfort of the story or the happiness of this farmer that you are still paying his invoice via us. And

SPEAKER_02: 1:02:59

don't abandon him or her just because it's winter and you're a bit fed up with cabbages.

SPEAKER_01: 1:03:05

No, that should be, it should hit like a selfish button in his head. So we need a farmer, we need the middleman, we need the customer, just all aligned. And it takes some, what's it called? Like an insurance, it should be

SPEAKER_02: 1:03:25

always there. It should be always there and you shouldn't think about too much and shouldn't be too difficult but when things are bad the insurance kicks in that should be confidence again confidence again yes

SPEAKER_01: 1:03:37

I the farmer need to trust us and I need to trust the customer but in return I have to do something else maybe then just providing always a tomato and therefore my customer is not my king very good point

SPEAKER_02: 1:03:52

and I want to be conscious of your time because we open up a lot of other places to go with the gut space and nutrient density and all of that, but we'll do that in future interviews. Just a few final questions. If you had a magic wand and you could change one thing anywhere, not just food and egg, but anywhere it could be food and egg, what would you change overnight?

SPEAKER_01: 1:04:15

Well, I was thinking about this, Koen, and the one is maybe the laziness we got in food at this point. The... we are not willing, we spend money and time on the wrong things in our society. Yes, so in Holland especially, we lost a food culture. We don't have a food culture in my opinion anymore. Well, so... I feel there's a story coming. As humans, we are making a scheme in which we have to treat animals So

UNKNOWN: 0:00

,

SPEAKER_01: 1:04:57

for example. Yeah,

SPEAKER_02: 1:04:58

certification to slightly improve animal welfare.

SPEAKER_01: 1:05:02

How would a cow look at our, for example, a cow on the way from Utrecht to Amsterdam, and he sees this traffic jam. Maybe we should make just like a regulation for people.

SPEAKER_00: 1:05:21

Less concrete, less time

SPEAKER_01: 1:05:23

inside. Our life is just a rat race in which we optimize everything that is not important and we forgot what is important, such as food and eating and having fun and just a good company. And therefore, we buy cars, we buy phones, we don't buy time, but we give time. This magic went, what you were talking about. Maybe the level of... willingness to pay attention to the most important things, such as nature and food and maybe the happy flow around food. And therefore, if this is aligned, they will spend more money on their hobby again. And if food or eating was a hobby, now we spend money on trains, on the attic. On films and stuff. On films. And so... But maybe at this point it's difficult to put your money where your meaning is. Because the systems are so incredibly large and hollow. Would you know where to buy your food that comes from a value chain? Would you know? We try. We try, but it's difficult. It's very difficult. And everything is industrialized. And so... And therefore, the money concentration in investment world is so... It's so narrow where the money is so concentrated and this money should work, I think, to... And therefore I come back to traffic. There should be more traffic on good food. And so more portals and more displays and I don't know. I

SPEAKER_02: 1:07:31

think it's a perfect moment to end this conversation and give people some food for thought. And thank you so much, Stijn, for coming on. I know you're extremely busy and need to take some time off after a very intense year. And I don't think it's the last time we talk and we have a lot of other rabbit holes to go down into and unpack. Thank you so much for your time until now. Thank you. Thanks again, and see you next time.