Rural Community Development
In addition to the tens of billions of dollars in debt capital we provide each year, CoBank is making investments in equity funds designed to spur economic development in rural communities. Along with other members of the Farm Credit System, we’ve joined with the U.S. Department of Agriculture in the Rural Business Investment Program (RBIP), a public-private partnership designed to enhance the flow of capital to businesses in rural areas, stimulating rural economies and increasing job opportunities.
Midwest Growth Partners Fund
In 2014, CoBank partnered with Central Iowa Power Cooperative to form Midwest Growth Partners, a $41 million private equity fund designed to strengthen the economic fabric of Midwestern communities. Managed by Top Tier Holdings, the fund provides succession planning liquidity for retiring business owners or growth capital for established businesses seeking to expand. Through December 2017, the fund’s portfolio totaled $16 million. One of the funds early investments, Market Fresh Produce of Nixa, Missouri, was sold in 2017 following two years of robust sales growth and the doubling of full-time jobs. The success of Market Fresh Produce is a strong example of the fund’s potential to positively influence economic investment and job creation in rural communities.
Advantage Capital Agribusiness Fund
In 2014, CoBank joined with eight other Farm Credit institutions to launch a $155 million equity fund formed under the auspices of the U.S. Department of Agriculture’s RBIP. Managed by Advantage Capital Partners, the Rural Business Investment Company (RBIC) focuses on investments that grow rural economies, with an emphasis on companies involved in all aspects of the food and agriculture value chain. Through December 2017, the fund had invested over $85 million in 13 companies.
Innova Ag Innovation Fund IV
In 2016, CoBank, along with seven other Farm Credit institutions, closed on an investment in its second RBIC. Managed by Innova Memphis RBIC, the $31 million fund invests in early stage companies that develop advanced technology solutions for the challenges faced by farmers and agriculture-related businesses.
Open Prairie Rural Opportunities Fund
In 2017, CoBank joined commercial and community banks, five other Farm Credit institutions and other investors to support the Open Prairie Rural Opportunities Fund. Managed by Open Prairie, a private equity fund management firm, The $55 million fund targets debt and equity investments in growth and later-stage companies across the agribusiness value chain.
Rural Debt Obligations
CoBank partners with other Farm Credit organizations, the USDA, community banks and rural communities to support bond investments in agriculture and community facilities that support rural areas. Since 2012, CoBank and its Farm Credit partners have facilitated more than $300 million of community facility bond investments, and CoBank currently has more than $100 million in potential investments in its pipeline. Importantly, these investments provide vital debt capital to projects that likely would not receive private funds without Farm Credit participation.