After spending 12 years as a successful professional investor, first working for Stephens Inc. in his hometown of Little Rock and then spending five years at a high-powered equity investment firm in bustling San Francisco, Carter Malloy was pulled off his career path by a revolutionary idea: democratizing the buying and selling of farmland.
“A few years back, my dad wanted to invest some money in Bitcoin,” Malloy recalls. “I told him that was crazy, because Bitcoin was speculative and there was no asset backing it. Ignore the fact it was terrible investment advice, because Bitcoin promptly ran from $600 to $18,000 each. He then asked me why we couldn’t sell more affordable pieces of land online. Near that same time, I had a neighbor wanting to invest in farmland, but he didn’t know anything about it.”
Carter Malloy
The demand was there, as was the supply, so Malloy began cultivating a plan that would take the needs of both farmers and amateur investors and build a true marketplace that would bring the two together. That idea became a reality when AcreTrader was launched in March 2019.
How it Works
The concept is fairly simple, but the execution takes a high level of expertise and a relentless work ethic. “We get here early and stay up late,” Malloy quips.
The team at AcreTrader is constantly reviewing farmland for sale, searching for high quality investments. (They claim to only end up buying 5 percent of the parcels they review.) Once AcreTrader establishes a real estate contract with a land owner, they then offer the opportunity for investors to purchase shares of the farm for as little as $1,000. Investors can get in on the action while wearing their PJ’s at home by simply going to acretrader.com and looking over the analysis of each parcel for sale, then clicking a few buttons. AcreTrader takes it from there, handling everything from accounting to land management to helping farmers improve soil sustainability. All the investors do is wait for their dividend checks in December (typically 3-5 percent of gross yield) and look forward to the farm appreciating over time.
The returns may not sound spectacular. Malloy admits, “This is not a get-rich-quick scheme,” but he points to the stability and performance of farmland as an investment. According to Malloy, farmland returns have been positive every year since 1990. Compared to gold, which many amateur investors turn to for stability in uncertain times, farmland’s performance has been far superior.
A Win-Win
It’s not only the investors Malloy and his team see themselves serving. “Most of our team grew up in farming families. We want to help farmers improve and expand.” Besides providing the capital that makes expansion possible, AcreTrader offers farmers independent valuation and nation-wide knowledge of the agtech industry. “Technology is a big part of success in farming,” Malloy notes. Helping farmers helps investors—a win-win situation.
To accomplish this win-win, Malloy—who grew up in a farming family—assembled a team that combined skill in investment practices with experience putting hands in the dirt. “AcreTrader is about the business and the great people that work here. I can’t emphasize enough how lucky we’ve been to put together such a great team.”
Garrett McClintock, head of Farm Operations, grew up in the Mississippi Delta as the fifth generation on his family’s farm. He brings experience in both investment services and agricultural business management. VP and General Counsel Elise Alexander was raised on a farm and cattle ranch in Crawford County, Arkansas before going on to obtain a J.D. from Pepperdine University School of Law. A team with experience on both sides of the fence is more likely to recognize and address the needs and concerns of both investors and farmers.
Full Circle
AcreTrader is based in Fayetteville, where Malloy and his wife Jenny attended the University of Arkansas. “We met on our first night of college,” Malloy remembers. Their fondness for Fayetteville was a draw, but Malloy also notes that Fayetteville fosters an excellent environment for startups. Startup Junkie, a Fayetteville-based consulting company, has been particularly helpful. “Jeff [Amerine] and the team at Startup Junkie have been instrumental in our success,” Malloy says.
After a dozen years of gaining invaluable experience working as a professional investor, spending the last five years in San Francisco, Malloy has come full circle, reuniting with the town where he earned his bachelor’s degree in Physics and met his future wife, returning to the farming business he grew up around, and putting it all together to start something revolutionary.
READ MORE: Online Farmland Investment Platform Launches
