Small agriculture businesses may soon be able to get some investment money from the U.S. Department of Agriculture (USDA) to help with expansion and business development.
A new program was announced on Monday that will spend about $150 million investing in small businesses in the agriculture industry that might otherwise have difficulty finding investors.
“This new fund will allow innovative small businesses throughout rural America to access the capital they need to grow and create jobs,” said Tom Vilsack, Secretary of Agriculture, in a press release. “This new partnership will allow us to facilitate private investment in businesses working in bio-manufacturing, advanced energy production, local and regional food systems, improved farming technologies and other cutting-edge fields.”
The new program has created a USDA-licensed, for-profit organization called the Rural Business Investment Company (RBIC) that will get money from eight Farm Credit banks. Unlike the small business loan programs the USDA has offered in the past, this new program will help provide private equity investments.
Advantage Capital Partners, a firm that specializes in small business, will help manage the funds and choose which companies to invest in.
Small rural businesses that are already established and looking to expand are the primary audience for the program. The funding would help these businesses grow without taking on additional debt.
Historically, urban areas often get more attention from venture capitalists, which is why this fund will focus specifically on rural America.
This new program is part of President Barack Obama’s “Made in Rural America” initiative. Both the Obama Administration and the USDA have it a priority to help boost the rural economy.
The USDA has begun taking applications for this program and other funding opportunities for rural small businesses. To learn more or apply for the program, go to the Rural Business Investment Program page on the USDA website.
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