The Let's Be Frank food trailer parked most days outside the old Helms Bakery complex in Culver City is no ordinary lunch wagon.
The San Francisco company that operates the hot-dog vendor serves franks and sausages made from cows that ate only grass or pigs that were raised humanely. Customers also can choose turkey or soy dogs, all on buns from L.A. Breadworks.
The small business was funded in part by venture capitalist Peter Rogers and his Dry Creek Ventures, which targets clean energy, water and food businesses.
Such small local food outfits, especially those that are gentle on the environment, are key to the long-term health of the economy but need formal access to local investors to succeed, says social venture-capitalist and entrepreneur Woody Tasch.
Shifting capital to organic farmers, independent food entrepreneurs, farmers markets and restaurateurs will pay off in stronger local economies, a healthier environment and improved supplies of affordable, healthful food, Tasch said.
He founded Slow Money Alliance last year to spearhead the creation of regional networks of local investors that want to put their money into local enterprises.
"We've had the life sucked out of our society and economy by financial markets run amok and globalism run to extremes," Tasch said. Slow Money is "part of a network emerging of people who want to repair the damage."
The Brookline, Mass., nonprofit, which was inspired by the Slow Food International local-food movement, had its first national meeting in Santa Fe, N.M., two weeks ago. Investors, investment bankers, entrepreneurs, farmers and others from around the world debated how best to build the networks. A team of five Southern California members, including chef and entrepreneur Gordon Smith of San Diego, will lead the efforts to build a regional network in the Southland.
Tasch says he feels a sense of urgency in shifting capital to local food businesses. He believes that the agriculture and food industry is ultimately as unstable and vulnerable to collapse as the global credit markets turned out to be.
Supermarkets full of cheap food have blinded people to the risk much as the 10%-plus annual returns on their stock portfolios lured people into a false sense of financial security before the recent global financial markets collapsed, he said.
"We have an industrial food system that is as imbalanced as the credit markets are, in terms of loss of biodiversity and aquifer depletion and soil depletion, leading to food systems as vulnerable to a massive correction as the credit markets are," said Tasch, author of "Inquiries Into the Nature of Slow Money: Investing as if Food, Farms, and Fertility Mattered."
What is slow money?
A network of investors, donors, entrepreneurs and others committed to building and steering major new sources of capital to local food systems. More broadly, it's part of a larger questioning in the wake of the financial craziness of the last X number of years, part of an emerging dialogue of fundamentally rethinking how to repair some of the problems of globalization and, including, markets gone crazy.
How can slow money help small local businesses?
Local food systems are just one pillar of local economies. Small businesses that have more direct, strong connections to their local customers and investors from the region are going to be more resilient and stronger businesses. This is all about building relations on local and regional levels of enterprises on one side and investors on the other.
Are you creating these networks from the ground up?
It's a big job, and it needs to happen relatively quickly for our health and security in face of future shocks of various kinds. Depending on how much money starts coming through Slow Money, we would be seeking to put that network in collaboration with existing networks and intermediaries to the extent possible. Where needed, we are also very willing to create new ones.
You want to create new capital markets to invest in sustainable, local, food-related businesses?
That's the beauty and challenge of what we are doing with Slow Money. It's not a typical fund structure. We didn't go to market to raise a $100-million fund. We are actually gathering a lot of people with us and looking at how can we do this on a mass scale.
How can we take it forward and have maximum impact in the shortest amount of time? Because I feel a real sense of urgency. There is a chance we can actually get organized around this and then move as fast as we can in other sectors.
Many small-business owners are struggling in the recession. Why should they take the time and possible risk to find more local places to invest their money?
This is a transition. This is not one-size-fits-all. But it's a direction people know deep down we need to go in, so people just need encouragement and to take whatever small steps they can.