Home-grown food companies with a green mandate, a strong brand and a proven business model will have the opportunity to tap into an innovative new investment fund this fall.
Investeco Capital Corp., a Toronto-based private equity group that bills itself as Canada’s first environmental investment company, is launching a $40-million fund dedicated to growing small and medium-sized food companies that meet its tough criteria, including at least $2-million in annual revenue.
“It has to sell to the public on the principle of sustainability and health,” said Andrew Heintzman, Investeco’s president and chief executive officer. “That’s where we think the market’s going but we also think it’s good to get capital into those kinds of companies – good for the economy and good for society.”
It’s unlikely there will be a shortage of prospects for the fund, which is open only to accredited investors. Canada is in the midst of a cross-country food-business boom fuelled by the popularity of local fare, organic and sustainably grown ingredients. The trend is attracting attention and investment from multinationals looking to get in on the game by buying up promising prospects such as Quebec-based artisan yogurt brand Liberté, which was bought by French giant Yoplait Group last year.
Investeco has already made successful investments in Organic Meadow, Eastern Canada’s leading organic dairy, as well as B.C.-based Horizon Distributors and Rowe Farms, an Ontario-based butcher and local food retailer anchored by an ethical farming philosophy.