Investing in Rural Jobs and Ag Innovation
Investing in rural communities is at the heart of Compeer Financial’s mission. It has guided our collaboration with the USDA, congressional leaders, financial professionals, private investors and other Farm Credit associations to build a portfolio of investment funds licensed by the USDA under the Rural Business Investment Program (RBIP). Compeer’s leadership in this arena has generated capital commitments of more than $1 billion to investment funds dedicated to advancing rural America.
WHAT IS RBIP?
The RBIP promotes economic development and job creation in rural areas by licensing third-party fund managers to raise capital and make investments in private companies in rural America. In 2014, seeing a shortage of flexible capital in rural America, Compeer Financial and other Farm Credit associations organized the first nationally focused, privately managed fund under the RBIP. That first fund alone has reported more than $7 billion in investment opportunities, confirming the need for more junior capital for businesses and entrepreneurs in rural America.
Since the inception of the first Rural Business Investment Company (RBIC), Compeer and other Farm Credits have played an important role in the RBIC formation process as limited partners in more than 10 investment funds. On its own, Compeer has procured more than $1 billion in junior capital from investors for RBIP funds, ultimately helping rural communities to grow and thrive.
“Reaching the $1 billion mark is evidence of Compeer’s commitment to its mission of enriching agriculture and rural America, and our spirit of collaboration with 22 Farm Credit associations and numerous other non-Farm Credit entities,” said Aaron Knewtson, Compeer’s vice president of food and agribusiness.
LOCAL BUSINESSES SEE GROWTH
Since 1990, Fast Ag Solutions has served the needs of farmers by manufacturing liquid fertilizer application and spraying equipment. Midwest Growth Partners, an RBIC manager, made an investment in in Fast Ag Solutions. The company, located in rural Windom, Minn., employs more than 50 full-time employees, creating and sustaining jobs in the community. Fast Ag’s application and sprayer equipment can be found all over the United States as well as in Ukraine and Australia.
“Combining these financial resources with our strong agricultural background brings a significant benefit to us as we seek to grow the company both organically and through mergers and acquisitions,” said Cody Fast, president of Fast Ag Solutions.
These types of growth-oriented equity investments in businesses serving agriculture and rural communities are prime examples of direct, positive impact RBICs make when they support entrepreneurs in the food and agriculture value chain.
This article was originally printed in the Fall 2022 edition of Compeer Financial's Cultivate magazine.