Context: a biome under pressure

The Cerrado is Brazil’s vast tropical savanna and one of the world’s most biodiverse biomes, functioning as the country’s agricultural engine. It is the source of eight of Brazil’s twelve major river basins and provides water to hundreds of millions of people. It is also where some of Brazil’s most important coffee-growing regions are located. However, decades of intensive agriculture have exacted a steep ecological toll, including degraded soils, diminished water infiltration, and stressed watersheds that once sustained both communities and crops.

In this landscape, water is an existential concern for coffee producers, agribusiness companies, and dependent communities. Until recently, the response to mounting water stress was fragmented, with companies and producers confronting challenges alone. Cerrado das Águas emerged from the recognition that fragmentation was part of the problem, acting as a platform for territorial regeneration that unites competing companies, farmers, research institutions, and public agencies around a common mission to tackle climate challenges in an integrated manner.

The initiative: pre-competitive collaboration for territory resilience

The defining insight of Cerrado das Águas is that the health of any individual farm depends on the health of the entire watershed. Shared ecological fates require shared governance and shared investment. At the heart of this model is the concept of pre-competitive collaboration: bringing together companies that compete in the marketplace to cooperate on foundational conditions, specifically water security. This reframes water security as a shared responsibility rather than an individual cost.

The initiative defines regenerative agriculture broadly as any practice that revitalises soil and improves water infiltration. This includes restoring permanent conservation areas and Legal Reserves, reconnecting forest fragments for local flora and fauna, and investing in agroecological systems that reduce dependence on chemical inputs. The programme supports producers through technical assistance, shared knowledge, and access to networks and resources often unreachable by smallholder farmers. Two key governance challenges involve persuading competing companies to collaborate on pre-competitive infrastructure and shifting mindsets to view water as a reflection of overall landscape health.

Progress to date

Cerrado das Águas is building the ecosystem required for landscape-scale change in a region where such coordination did not previously exist. Its network links multinational coffee buyers with smallholder farmers and key enabling institutions. Partnerships with organisations such as SEBRAE and academic centres, including the Federal University of Uberlândia, the Federal University of Itajubá, and the Federal University of Viçosa, have embedded technical rigor and regional credibility. Early investment from funders like the Critical Ecosystem Partnership Fund (CEPF), Funbio, the Cargill Foundation, and the Rabobank Foundation has accelerated participation.

Ecologically, the restoration of habitats is reconnecting fragmented areas and re-establishing corridors. Economically, the transition is generating a restoration economy and diversifying income streams through supply chains for organic inputs and soil health services. Socially, the initiative is reshaping perceptions of farming among younger generations, helping to retain talent within farming communities. At a systems level, improved watershed functions are reinforcing food and water security for both coffee production and municipal supplies downstream.

The TIFS partnership: converting potential into system readiness

In August 2025, Cerrado das Águas engaged TIFS as part of the Regenerative Catalysts Programme to transform its model into a scalable, investable system. During the second half of 2025, weekly meetings were held to jointly develop an expansion model, focusing on scaling regenerative systems on smallholdings and promoting local trade. This partnership helped transform existing strengths into an organisation ready to lead at scale, defining strategy as an active process.

TIFS supported the initiative in strengthening its financial architecture and clarifying its role within the broader investment ecosystem, converting proven models into vehicles for capital and partners. The combination of a structured approach and validation from rigorous funders like CEPF and Funbio functioned as a powerful market signal, shifting the focus from whether the model is viable to how effectively it can be scaled.

The missing middle — lived experience

The experience highlights a structural gap that the Regenerative Catalysts Programme addresses: access to the right type of capital at the right stage. While current financial structures sustain specific projects, achieving the core mission of climate resilience requires catalytic capital. The report distinguishes between corporate financing, which focuses on individual company risk and securing supply chains, and catalytic capital, which invests in the ecological infrastructure—securing the territory—on which all production ultimately depends.

What funders need to understand about risk

Cerrado das Águas challenges prospective funders to recognise that consequential risks are not fully captured by conventional metrics. Ecosystem indicators, such as the recovery of soil microbiota and the replenishment of aquifers, operate on biological timescales that resist short-term measurement. There is also a relational dimension to risk; trust is considered the scarcest and most valuable asset in the field. The interruption of financing or the failure of a recommended practice can permanently close the door on a family’s willingness to engage in future sustainability initiatives.

Vision: a replicable model for landscape resilience

The initiative aims to demonstrate that production and conservation are interdependent objectives. It seeks to reframe the identity of smallholder farmers as ‘Producers of Climate Resilience’ who integrate science and nature to ensure territorial food and water security. Immediate priorities include translating frameworks into operational financing mechanisms, such as parametric insurance, scaling the producer network, and formalising governance structures that can be replicated across other Brazilian watersheds. The initiative is currently in dialogue with the National Coffee Council and the Ministry of the Environment.

Lessons for the field

Key lessons include the fact that pre-competitive collaboration is possible but requires a trusted, neutral convener to build long-term trust. Cultural change is the hardest and most durable form of transformation, requiring continuous technical assistance and education. Catalytic capital is essential for making models legible and credible to a broader range of investors. Finally, impact measurement must respect biological time, as short-term, quarterly metrics cannot capture the depth of transformation in a regenerative landscape.

About the Regenerative Catalysts Programme

TIFS’ Regenerative Catalysts Programme partners with leading place-based initiatives to strengthen financial frameworks and market connections. The programme is designed to help initiatives bridge the ‘Missing Middle’, moving from proof of concept toward durable, system-level change.