Fundraising stabilizes in 2023 to hit $8bn

Agri-food and forestry funds rallied in H2 as significant closes at Paine Schwartz, Proterra and Brynwood Partners propelled capital raising.

Fundraising for unlisted agri-food and forestry vehicles stabilized in 2023 as the market took $8 billion during the calendar year, up from $5.9 billion in 2022, according to Agri Investor data.

Taken in tandem with the whole-year figures for 2021 ($9.5 billion) and 2020 ($8.7 billion), 2022 has emerged as the poorest fundraising year over the past five years (the market took $9.3 billion in 2019).

In the current climate, stabilization is no bad thing, especially in light of 2023 representing the worst fundraising year for several years in asset classes such as infrastructure, private debt and venture capital, among others, and private equity more generally.

The year got off to a slow start for dedicated agri-food and forestry funds (our report excludes vehicles that invest in the asset class opportunistically) with the market taking $2.2 billion at the mid-year point (the $1.4 billion fundraising figure cited in our H1 report related to all the H1 vehicles that had been disclosed at the time).

Paine Schwartz Partners’ close of its $1.7 billion Food Chain VI vehicle was certainly a standout moment in the year, as the fund became the third-largest dedicated food and agriculture private equity fund ever, according to Agri Investor data.

First and second place still belong to TIAA’s $3 billion Global Agriculture Fund II and the $2 billion Global Agriculture Fund I.

However, Vision Ridge Partners’ Fund IV, which is currently in market and has a $2.5 billion target, may well have something to say about this pecking order when it reaches its final close.

And on the subject of largest fund closes to date, Proterra Investment Partners shook up the rankings with regards to debt vehicles.

The firm’s $500 million Credit Fund II, which closed in the summer, became the joint second-largest dedicated food and ag debt vehicle ever, after Amerra’s 2013 close of its $570 million Agri Fund II (Amerra’s $500 million Agri Fund III is the other second-placed debt vehicle).

Along with Cerea Partners’ €300 million close of its Mezzanine IV Fund, debt vehicles made a strong comeback in 2023, representing 10 percent of all capital raised.

On a regional basis, funds dedicated to North America continue to lead the way in terms of capital raised on a five-year basis, with the region taking $15.2 billion since 2019.

Following closely behind are multi-regional funds at $13.7 billion, with Asia-Pacific ($5.7 billion), Europe (3.7 billion) and Latin America ($930 million) vehicles making up the top five.

We may well see an exchange between the top two regions in the next two years, as five multi-regional funds seeking more than $6 billion are currently in market, with no funds dedicated to North America among the 10 largest vehicles currently fundraising.

The early news on the ground for 2024 has been positive so far, with Stafford Capital Partners having raised $635 million towards its $1 billion target for its Fund X, with a Q3 final close earmarked by the firm.

Meanwhile, the pace of fundraising at BTG Pactual, which has three $1 billion vehicles in market, could also help set up another positive year.

Check out our interactive fundraising report HERE for the full breakdown of fundraising activity in 2023. You can also download a PDF of the report HERE and download the data HERE.