As an investment category, regenerative agriculture and food systems started 2025 strong, raising $1.17 billion in the first quarter according to new data from the Regenerative Food Systems Investment (RFSI) group.

This is up slightly from the $1.13 billion raised in the first quarter of 2024, and “significantly higher” than totals for the second and fourth quarters of that year ($247 million and $215.7 million, respectively).

However, the high investment number for Q1 2025 is in large part thanks to Flowers Foods’ acquisition of Simple Mills for $795 million.

“At first glance, the scale of investment in Q1 is a little surprising especially given the current investment climate,” RFSI managing director Sarah Day Levesque tells AgFunderNews. “But given that one relatively large acquisition accounts for nearly 70% of that, it’s a little more in line with expectations. Without that acquisition, Q1 2025 totals are considerably less than what we saw in Q1 2024.”

VC still driving the most deals

RFSI aims to drive more investment into regenerative systems through research, education, and events. Each quarter, the company tracks investments and other capital allocations into the regenerative agriculture space. This includes a mix of venture capital, funds, philanthropic capital, and equity, to name a few.

Almost half (46%) of all deals in Q1 2025 were from venture investment: $123 million across 17 deals. (RFSI notes that some deals did not disclose totals.) This is almost exactly the same as the first-quarter OF 2024, when venture accounted for 44% of all deals.

It is possible this balance could shift in the coming years. Many are already asking whether VC is an appropriate vehicle for regenerative agriculture, given ag’s long return timelines when stacked against the shorter cycles that characterize most venture.

Meanwhile, a panel of farmers at this year’s RFSI forum in Brussels suggested that non-traditional capital is needed for regenerative farmers, many of which think investors need to spend more time on the farm to understand it as an asset class.

RFSI’s Q1 2025 report also highlighted the equity category, which includes acquisition and accounted for the most investment dollars by far thanks to the Simple Mills deal. Equity represented 24% of all deals for the quarter, up from 22% in Q1 2024.

Debt and philanthropic capital/grants both accounted for 14% of all deals. Public funding accounted for 3% thanks to one deal: a $3.7 million investment from The Australian Centre for International Agricultural Research (ACIAR) to help smallholder farmers in Cambodia adopt sustainable and regenerative practices.

Europe maintains the largest percentage of deals across global regions, with 38%. It is followed by North America, at 35% and Asia, with 16%. Africa and Latin America represented 8% and 3%, respectively.

More investors interested in regen

Outside of the above deals, RFSI also reports more than $650 million in raises and closes for funds, both regenerative and “regen adjacent.” The latter applies to “funds that are working beyond simply sustainability toward regenerative outcomes but may not be wholly regenerative or it may not be the fund’s entire focus.”

Among those funds were real asset manager SLM Partners, which held the final €30 million ($34 million) close of its SLM Silva Europe Fund, and Just Climate, which raised funds to start investing in tools that reduce agricultural emissions.

Eurazeo, a private equity investor from France with no previous history in agriculture, raised €300 million ($314 million) for a new fund “investing in line with the planet’s ecological limits.” Its first investment was into UK-based Bioline AgroSciences, which has developed biocontrol solutions for berries, flowers, and vegetable crops.

Other funds included those from sustainable asset management company Mirova, also from France, and VC firm At One Ventures.

“There are far more investors who want to invest in regenerative agriculture and forestry,” SLM managing partner Paul McMahon recently told AgFunderNews. “It’s certainly a feeling of achievement on our side that we’re getting backing for something we’ve been talking about for quite some time.”