WHAT IS CROWDFARMING?
Crowdfarming is a way of pooling resources and money in the farming sector. In practice, it means investing a certain amount of money to purchase a good that a farm might need, but cannot afford alone. Depending on the type of farm, this could be a cow, a pig, chickens, or a certain amount of corn or wheat. The investor can track their investment, for example its growth, and when it eventually gets sold, they get a part of the profit from the sale.
WHAT ARE ITS POSITIVE ECONOMIC EFFECTS?
Crowdfarming has many of the same positive effects as crowdfunding and investing. It allows farmers to have easier and greater access to money, which can help them get off the ground and grow their businesses. But it also has a positive effect on the community, since locals can now play a part in and benefit directly from the success of their local farmers.
ARE THERE ANY NEGATIVE EFFECTS?
The main issues with this type of funding arise from infrastructure and logistics. In the first case, there are not many established platforms for crowdfarming. This is an especially big problem since for crowdfarming, it is important to have a large amount of interested investors as well as farmers. On the other hand, it can be logistically complicated to manage investments in goods that are not only volatile, but that can take months or years to yield profits.
WHAT ABOUT THE SOCIAL EFFECTS?
While there are both economic upsides and downsides to crowdfarming, its most significant advantages are social. Crowdfarming platforms allow for easier investment from developed countries to those that are developing. Furthermore, just one investment can be enough to have a very large impact on the life of an individual or even an entire community.
Overall, it is clear that crowdfarming is still in its early stages. However, hopefully many of the issues that it currently faces will be solved eventually, allowing investors and farmers alike to capitalize on its economic and social advantages.