It was 2010, and Catherine Sutton, having lost faith in the viability of the stock market, pulled out her money from investments that she suspected weren't as socially responsible as brokers were making them out to be. She wanted to put her money in something local, sustainable and, she added, "100 percent ethical."
That's how she ended up becoming one of nine investors in the Soul Food Farm in Vacaville, which provides range-free poultry and eggs to markets around Northern California and Bay Area restaurants, including Chez Panisse and Oakland's Camino. The farm owners, Alexis and Eric Koefoed, repay her monthly with interest -- and eggs -- and Sutton knows how her money is being used.
But Sutton, who keeps four chickens of her own at her Albany home, wouldn't have known Soul Food Farm was looking for a loan if it hadn't been for an organization called Slow Money. The nonprofit group connects socially responsible lenders with local food enterprises and farms that support soil fertility and their economy.
It's one of a growing number of such alternative fundraising models surfacing in response to the "locavore" demand for food grown locally and sustainably, as well as public scorn at traditional finance models in the wake of the subprime mortgage crisis.
"People want to know what their money is doing out there in the world," Slow Money founding member Marco Vangelisti said. Slow Money, he said, "is as far away from high-flying
Soul Food Farm used the $40,000 loan received in 2010 for feed, coops and new chicks. Now they have up to 2,500 heritage-breed hens that roam 55 acres, pecking at bugs and blades of grass. They also hired extra help so Alexis Koefoed could kick-start a culinary herb offshoot. "Having all your eggs in one basket doesn't work for a small farm, no pun intended," Eric Koefoed said.
The eggs and meat will travel no further than San Francisco. But just down the road from the farm, the freeway is busy with semi-trucks hauling federally subsidized industrial-farmed produce and other commodities across thousands of miles from farm to fork.
That's exactly the scenario activists like Theo Ferguson, a Slow Money founding member from Berkeley, wants to stop. "Every single penny, nickel and dime you put on the table, you are driving the nature of your economy," Ferguson said.
The goal is to have 1 million people invest 1 percent of their income. So far, Slow Money has facilitated 30 investments totaling $11 million since about late 2009.
The minimum investment varies from small amounts made through loans to the farmer or entrepreneur to $1,000 to buy into a Slow Money-aligned investment fund to the $5,000 minimum set by the Northern California chapter.
Each of the 12 Slow Money chapters that have sprung up nationwide since about 2009 operate slightly differently.
The Northern California branch organizes showcases in which entrepreneurs vetted by members present their ideas to potential lenders, Vangelisti said. The group also is forming an investment club and a grant-making arm.
Other ideas to help food enterprises get past the barriers of traditional investing are popping up, from urban rooftop gardens to an Oakland collective that raises chickens. Community Supported Agriculture networks -- called CSAs -- have become a popular way for consumers to buy local, seasonal food and, increasingly, meat directly from a farmer, as have the thousands of farmers markets around the country. People feel more connection to the growers and the local food network they're helping to rebuild, a key motive behind the movement. There are also groups such as FarmsReach, Lending Circles and Investors' Circle.
"The system is a bad system, and Slow Money and others are attempting to address it," said Al Courchesne,a farmer of 40 years who owns the Frog Hollow Farm in Brentwood that sells organic fruit and olive oil at the San Francisco Ferry Building. His farm has the track record that allowed him to work with a local community bank.
In contrast, banks won't even consider a small, young company such as the Capay Valley Farm Shop, which has received funds from Slow Money investors. In contrast, banks won't even consider a small, young company such as the Capay Valley Farm Shop, which has received funds from Slow Money investors. The shop distributes produce from 30 small family farms in Yolo County to the East Bay farmers markets, Silicon Valley businesses such as Adobe and NetApp, Chevron employees in Concord and to hospitals. Capay's mission attracted Peter Ruddock from Palo Alto, who decided to buy a share in the enterprise that received $82,000 in 2011 from Slow Money investors.
Capay plans to use the money to open a retail shop and depot so the farms can sell their products directly to townspeople and expand to new markets, including Oakland.
Slow Money, however, is not for everyone.
It takes people who are looking for a commitment based on their values, not on financial returns, said Brahm Ahmadi, founder of People's Grocery, who has been trying to raise money for a community store that sells conventional and organic local food in West Oakland.
Slow Money is also a slow-moving concept that could be called patient money, in part because it is new and in part because local chapters depend on the energy of volunteers who have no budget.
"It's an inefficient marketplace at this point," said Anthony Chang, who helped introduce Slow Money lenders to Soul Food Farm and Baia Nicchia tomato farm in Sunol. He is also director of lending for California FarmLink, one of very few nonprofits to make loans to encourage traditional farms.
Chang is still optimistic, however. "The impact is limited, but the potential is significant."
chat live about your food issues
Join the Oakland Tribune for an online chat about access to fresh local food 2 p.m. Tuesday www.insidebayarea.com/live-chats.
explore the SLOW MONEY concept
Visit www.slowmoney.org for information about the monthly meetings that are held every third Monday and a Feb. 25 Slow Money tour and potluck dinner at Tara Firma Farms in Petaluma. Info: slowmoneynocal.org/tarafirma-farmfest.
Visit www.slowmoney.org for information about the monthly meetings that are held every third Monday, and a Feb. 25 Slow Money tour and potluck dinner at Tara Firma Farms in Petaluma. Info: http://slowmoneynocal.org/tarafirma-farmfest