Kering-backed Mirova invests $30.5M in Varaha for regenerative farming

French investment firm Mirova, which focuses on climate solutions and is supported by luxury group Kering, has committed $30.5 million to Indian climate technology startup Varaha. This capital injection will fuel the expansion of Varaha’s regenerative agriculture program, directly benefiting hundreds of thousands of small-scale farmers across northern India.

This transaction represents Mirova’s inaugural carbon-focused investment in India, structured in a distinctive way. Instead of acquiring equity, the Paris-headquartered firm is providing cash in exchange for a future share of the carbon credits generated by the initiative. This aligns with Mirova’s broader carbon strategy, which directs corporate funds toward verified emissions reduction projects. Mirova is affiliated with Natixis Investment Managers and lists major backers such as Kering, Orange, L’Occitane Group, Capgemini, Unibail-Rodamco-Westfield, and MANE, all corporations actively seeking credible carbon initiatives to address their supply-chain emissions.

Regenerative farming, a set of practices that rebuild soil health and boost biodiversity through techniques like crop rotation and minimal soil disturbance, is increasingly viewed as a viable method for building climate resilience in agriculture. For India’s vast population of smallholder farmers, who grapple with deteriorating soil quality and unpredictable monsoons, these methods are not just about sustainability but also about securing livelihoods.

Established in 2022, Varaha designs and manages carbon projects spanning regenerative agriculture, agroforestry, and biochar. The company collaborates with 48 local implementation partners and uses proprietary software for real-time monitoring, reporting, and verification of both environmental and social impacts.

Mirova’s funding is directed toward Varaha’s Kheti project, which encourages farmers in Haryana and Punjab to adopt low-emission agricultural practices. In return, these farmers earn verified carbon credits, creating a new revenue stream. Currently, the project spans more than 200,000 hectares and aims to eventually reach approximately 337,000 farmers across 675,000 hectares.

Varaha’s methodology is customized for India’s dominant cropping systems, particularly in rice-growing regions. According to Madhur Jain, the company’s co-founder and CEO, the startup emphasizes direct seeding of rice and integrating crop residue into the soil. This offers a critical alternative to the common practice of burning crop stubble after harvest. Jain explained, “Rather than burning the residue, specialized agricultural machinery cuts it and mixes it back into the soil.”

The company also advocates for reduced tillage, moving from multiple rounds of ploughing to just one or two passes. This helps preserve existing soil carbon and enhances the soil’s ability to store more carbon over the long term.

A significant portion of Mirova’s investment will be used to procure the machinery required to implement these regenerative practices. Jain noted, “Adopting direct seeding of rice, which uses far less water than traditional transplanting, requires thousands of direct seeders. Since this isn’t yet a mainstream practice, market supply falls short of demand, so we must work directly with manufacturers. The same applies for machinery like happy seeders and super seeders used in crop residue management.”

Carbon credits generated through the program will be verified using Verra’s VM0042 methodology. A revenue-sharing model ensures that a portion of the proceeds flows directly to the farmers involved. The project is also pursuing Verra’s Climate, Community & Biodiversity (CCB) certification, which acknowledges land management initiatives that deliver environmental, social, and biodiversity co-benefits.

Although Verra is a leading global carbon credit verifier, it has faced scrutiny after reports indicated that some projects it certified may have exaggerated their emission reductions. Jain stated that Varaha continues to work with Verra because the nonprofit offers the most scientifically rigorous methodology for soil carbon. He clarified, however, that Varaha is not exclusively tied to one registry and also partners with other standards such as Puro and Isometric. Jain added, “To date, no one has raised concerns about the integrity of Verra’s soil organic carbon credits.”

Beyond emissions reduction, Varaha’s technology aims to enhance soil health, decrease water consumption, reduce chemical inputs, increase crop yields, lower production costs, and contribute to improved air quality. The company also intends to launch programs specifically for women farmers to advance gender inclusion in rural areas.

Varaha’s global profile received a boost earlier this year when it signed an agreement with Google, described as the world’s largest biochar carbon removal deal. Under this arrangement, Google will purchase 100,000 tons of carbon dioxide removal credits from Varaha by 2030.

The startup’s investor base includes RTP Global, Omnivore, Orios Venture Partners, the Octave Wellbeing Economy Fund from IMC Pan Asia Alliance Group, and Japan’s Norinchukin Bank. To date, Varaha has secured $12.7 million in venture funding, which includes an $8.7 million Series A round completed last year.

(Source: TechCrunch)