TerraMagna Makes It Rain in Funding Round

Jan 18, 2022

TerraMagna of Brazil just made it rain in its most recent funding round. The startup secured $40M in debt and equity financing, in a round led by SoftBank and Shift Capital.

Background: Farmers don’t have much liquidity and often rely on commercial loans from their input retailers. But not everything is digitized in Brazil, which makes gaining access to financial products more difficult. Lenders are hesitant to take risks, as collections on a foreclosed farm can take anywhere from 5-7 years.

…enter TerraMagna, which offers loans in partnerships with distributors and industries that already have long-term local relationships with small and medium-sized farmers.

Before underwriting a farm, TerraMagna looks at various data sources, including satellite imagery, environmental track record, climate data, and information from the notary.

Soundbite: “We have a saying, ‘If you’re operating in the red, you’re not going to care about the green,’” said TerraMagna co-founder and CEO Bernardo Fabiani.

And there’s more… Besides being a lender, TerraMagna offers point of sales (POS) systems to farming retailers and can capture financial data on the retailer and the farmer.