Backyard Aquaponics
A place to discuss aquaponics

Post showing how it is possible to use the R&DTI to fund growth.

http://www.fishfarmers.com.au/2015/12/08/how-much-will-the-new-20-incentive-help-innovation/

That was an interesting read even for a no-nothing like myself Stu. It does boggle the mind how hard it is for something this promising to get startup funds.

Martin.

I would really appreciate people submitting us to this forum and sharing our project with your friends. If ever social media could help us to demonstrate drought proof methods of farming without the environmental impacts of industrial agriculture then this forum is it and now is the time.

http://oursay.org/victoriandrought/drought-proof-food-production-with-reduced-environmental-impact-and-lower-costs-of-production

We have been told by the CEFC, NAB and Comm Bank that we can get most of the funds we need for development through a Clean Energy Finance Corporation loan (3.75% interest rate).
We have been told by AusIndustry that almost all our development and operational expenditure will be eligible for the Research and Development Tax Incentive.
We have been told that we can have a loan to buy land based on our salary once we are employed by our company.
We can borrow all the money we need to develop our systems and purchase the land on which to build them with equity and satisfy a loan to value ratio of 40:60.
Our business plan demonstrates that we can repay the loan even on a 15 year term and when subject to a borrowing stress test which assumes an interest rate of 8.5%.

However...

We can't get the loan for the full amount because we don't fit inside a neat borrowing box and our project is too "innovative".
We can't get the loan for the development until we have the loan for the land.
We can't get the loan for the land until we have the loan for the development.

We are currently seeking seed funding to get a deposit to buy the land so that we can then get the development loan. Perhaps this program will be able to help us.

We don't want grant money from the government. We can afford to pay our own way but maybe under this program we could get the loan we need to implement our drought proof growing methods?
If you agree could you please share this post AND make a submission recommending that we (http://www.fishfarmers.com.au) get a loan to demonstrate just how little water we need to grow so much food.

Not exactly sure what I've just joined up to...
But with all the help you've given us on the forum and the fact it is a good idea and has potential, it's the least I could do, so I've voted for you...
Good luck.

Thanks Skeggley.

If I can get the ministers nod we can get the loan and finally get started.

Done.

Thanks Martin

Ok I'm in; hope you get it Stuart.

Thanks Sleepe.

Sharing it on FB would also be a great help.

Well I've had a series of setbacks.

Back in June I was encouraged by a bank to redo our business plan and submit it to them. "Don't worry about how big a loan you ask for just put in what you need and then we can work out how much we can help."

Up until that point I had stayed away from banks because I didn't think they would be interested.

So about four months of work to redo every thing only to be told by that bank "No, No, No, nut." Having been let down by people before I was very glad that I had also submitted the plan to every other bank and agribusiness lender I could think of.

These are some of the responses I got back.











However, even with all the above I still had two banks that were showing interest but had concerns.

Before Christmas one of them said they couldn't do the land and the development so they asked me to redo the plan with the land purchase stripped out. They also said that the majority of the loan could be subsidised (3.75% interest rate). by the Clean Energy Finance Corporation because of our electricity savings. How much they were not sure but worse case scenario all our solar panels, storage and back up system.

So I re did the plan, assumed an interest rate of 9% instead of the 3.75% and 5.5% rates they said they could offer, stripped out the land, stripped out all the income from leasing out the land to others, assumed that the R&DTI would be cancelled and that nothing would replace it and finally assumed that everything was sold whole sale down at the city market.

Financial forecast still showed we could fully pay off the loan within ten years while also internally funding the growth in production capacity from 9.5t of Fish and 30T of veg to 60t of fish and 200t of veg.

I fully expected them to NOT fund the full 600k even with the security we were offering so we started our expression of interest for investment to raise funds and I asked them to answer this question:



To cut a long story short, they wouldn't tell me.






So I'm not happy.

Soldiering on though. Looks like we have some more people willing to commit some more funds and one person interested in increasing their commitment.

A small investment fund has said that they will commit something but not how much. While a larger fund is actually showing some serious interest and is not giving me the standard "we will invest in the next one" answer.

So frustrated for you buddy. I really think you deserve to get the funds and get going, it would be an awesome project.

A really dumb question (I hope you don't want to kick me in the head for it) - what about a platform like Kickstarter? Is that not an option? I'm sure you've thought of it ages ago and discounted it for good reason but I was curious.

We have someone that has volunteered to run a crowd funding campaign for us but their advice was to not run the campaign until the land was secured and the project was definitely going ahead. We could then use the crowdfunded cash to reduce debt and provide a cushion.

There are a stack of people that have tried and are trying crowd funding AP systems, generally without much success. While we are serious where as they just seem to be asking for cash expecting to be able to raise 500k via crowdfunding is a big ask. That was one of the reasons why I pressed the banks for an answer on what they cover. If they had said "we will do 300k" and I already have about 100k that would mean we would only need 200k and the fact that we had already secured 400k would have made the chance of getting 200k via crowdfunding possible even if still a tall order.

So frustrated. I've still got leads i can run down but I'm running out of time and options.

Okay, understand the crowdfunding scenario. This whole situtation is very frustrating.

I'm going to be on Hepburn Community Radio tomorrow morning to talk about our plans for a Rural Business Incubator / Cooperative Farm that will host our Drought Proof Aquapoincs System. I'll be arriving at the studio for 8:15am so I guess I'll be on shortly after that.

We are looking to gather support form the community to get the Victorian Minister for Agriculture's attention.

The Minister is going to be deciding how to allocate $10 million dollars to help Victoria adapt to drought. If we can get enough community support then we have a chance to convince the minister to support us with a fraction of those funds. That means drought proof jobs for the community and access to land for a range of small scale farmers and rural businesses. It will also open the door for further support form the Federal Government. We only have until the 31st of January.

Follow the link below and click on the "listen live" button to hear what I have to say. No podcast feature so you have to listen live.

http://www.hepburnradio.net.au/

Got two announcements for today.

We have had a MAJOR win.

The Social Enterprise Fund of Australia has agreed to back Hedgerow Farm. Its not a formal offer of finance but it will be once we have a 25% deposit (plus costs) and enough individual enterprises with their leases to meet the mortgage payments plus a buffer of 25%.

The funding of Fish Farmers is harder but we are talking about SEFA possibly doing 45%, Embark is saying they might be able to help with fund raising for the energy solution (about 13% of budget) so that would mean we have almost 60% of the funding for Fish Farmers.

Also have Costa of Gardening Australia fame on board and we are going to be talking about how to better promote Hedgerow Farm.

So it looks like we might be finally getting some real traction.

So far we have expressions of interest from investors to the tune of 92k (we need about 400k) and income from leases is now at ~81k (we need ~111k).

So getting closer but not there yet. Plus a miss is as good as a mile we have to jump all the hurdles to finish the race.