HeavyFinance's €50M boost for green agriculture

14 March 2024

Small and medium-sized agricultural businesses in five European countries will receive a total of €50 million from HeavyFinance, a Lithuania-based financial technology company to support on-farm decarbonisation and greener farming practices.

The money will come from a HeavyFinance credit fund to which the European Investment Fund (EIF) has committed €20 million.

The EIF commitment is backed by InvestEU, an EU programme to mobilise at least €372 billion for European policy priorities by 2027.

HeavyFinance is raising €50 million for a private credit fund that will support European agricultural small and medium-sized businesses (SMEs) with tailor-made finance. The funding will be available to finance solutions to advance the decarbonisation of agriculture in Bulgaria, Latvia, Lithuania, Poland and Portugal.

HeavyFinance is empowering European farmers to cultivate a more sustainable future. With the support of the EIF and InvestEU, we are nurturing the growth of regenerative agriculture, contributing to decarbonisation, unlocking the potential of our land and fostering a more resilient planet.”

Marjut Falkstedt, EIF Chief Executive

As a cornerstone investor, the EIF has committed €20 million to the fund. This sum will not only boost the fund but also help attract additional investors – both public and private. This agreement was made possible with the support of the InvestEU programme, which aims to trigger more than €372 billion in additional investment between 2021 and 2027 for EU policy priorities, including the green and digital transitions.

The fund will provide mid-term debt capital for small and medium-sized agricultural companies to support them in their efforts to reduce their carbon footprint through greener practices. These include alternative soil-friendly techniques that sequester carbon and improve soil health. Examples include so-called “no-till farming” (using no or less ploughing), less reliance on synthetic fertilisers and use of less polluting farming equipment.

Farmers are facing unprecedented challenges due to climate change, but they are also at the forefront of finding innovative nature-based solutions. This fund represents a crucial step in HeavyFinance’s commitment to eliminating one gigaton of carbon dioxide from the atmosphere by 2050.”

Laimonas Noreika, HeavyFinance Chief Executive Officer and founder

"Small and medium-sized businesses are the backbone of Europe's economy. They are simultaneously affected by climate change and play a vital role in addressing it. Thanks to the InvestEU programme, we will provide SMEs active in agriculture with the finance they need to work towards decarbonisation. The support will help them for instance to upgrade their equipment and expand working capital. This, in turn, will enable growth and job creation. I am delighted that companies in Bulgaria, Latvia, Lithuania, Poland, and Portugal will be supported by this agreement.

Paolo Gentiloni, Commissioner for the Economy

The European Union recognises soil as a significant carbon sink and the agricultural industry as crucial to achieving the goal of climate neutrality by 2050. The fund aims to remove 0.376 tons of carbon dioxide equivalent per year for every €1 000 invested, aligned with the European Investment Fund's Climate Action and Environmental Sustainability guidelines.

Established in 2020, HeavyFinance has taken more than 10 000 soil samples to help measure carbon storage on farmland. The company has already enabled more than €50 million in agricultural loans to promote sustainable practices, modernise equipment and increase working capital in agriculture. Targeting small and medium enterprises, HeavyFinance has issued more than 1 700 loans to farmers facing barriers to financing from traditional institutions to help them advance their transition to more sustainable agriculture.

As an early investor in the company, we are proud of its achievement of such an important milestone. The capital raised will double all the financing HeavyFinance has provided since its inception. The founders have shown a relentless drive toward advancing sustainable farming and tackling climate change challenges. This shared vision and their remarkable tenacity cement our confidence in their continued success.

Aleksander Dobrzyniecki, Partner at Black Pearls VC

Our steadfast commitment to fostering innovation and empowering sustainable practices in agriculture is thoroughly embodied in our partnership with heavyFinance. By leading their pre-seed funding round and contributing to their subsequent growth, we at Black Pearls VC demonstrate our unwavering belief in the brilliant minds behind this venture.

Background information

The European Investment Fund is part of the European Investment Bank Group. Its central mission is to support Europe’s small and medium-sized enterprises (SMEs) by helping them access finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments that target this market segment. In this role, the EIF advances key EU policy objectives including competitiveness, growth, human capital and climate action.

The InvestEU programme provides the European Union with long-term financing by mobilising public and private funds for a sustainable recovery. It generates additional investments in line with EU priorities such as the European Green Deal, the digital transition and support for small businesses. A range of EU financial tools is brought together to support investment with simpler, more efficient and more flexible project financing. The programme has three components: an InvestEU Fund, an InvestEU Advisory Hub and an InvestEU Portal. The InvestEU Fund is implemented via various financial partners. They invest in projects by using an EU budget guarantee of €26.2 billion to mobilise at least €372 billion in extra investments.

HeavyFinance is in the business of removing one gigaton of CO2 emissions through agricultural financing. The company operates as a marketplace connecting investors – from retail to institutional – with European farmers in need of external funding to expand their operations and shift to regenerative agriculture. HeavyFinance has facilitated financing for more than 1 700 agricultural ventures in Bulgaria, Latvia, Lithuania, Poland and Portugal.

Black Pearls VC is an early-stage venture capital firm focused on supporting the leading tech companies from the Baltic Sea region. It invests are pre-seed and seed with a typical ticket of €100k - €1m. Black Pearls VC is a part of the Kauffman Fellows, a global network of 700+ leading VCs. Selected investments include Nordigen, Autenti, Telemedi, Enso, HeavyFinance. Thanks to its investment strategy, the fund has exited six investments over the past two years, returning capital to investors with a profit. The team of Black Pearls VC anticipates more exits from its current portfolio delivering superior returns to their existing LP base in the coming years, while also launching a new fund.