May 4, 2016

U.S. Secretary of Agriculture, Tom Vilsack announced the launch of the Open Prairie Rural Opportunities Fund. The $100 million private capital fund will focus on investments in small, rural American food and agricultural businesses that are well positioned for growth along the value chain.

This fund will be the fourth Rural Business Investment Company (RBIC) that the U.S. Department of Agriculture (USDA) has partnered in launching since 2014.

“What excites me about this particular fund is (that) one of its focuses is on precision agriculture and data management,” Vilsack said in his address to attendees of the Rural Opportunity Investment Conference reports Agri-Pulse. “As we become more sophisticated in agriculture, we need to become more precise, and we need information and data to be collected and analyzed properly.”

Under its Rural Business Investment Program (RBIP) the USDA has licensed three prior RBICs designed to provide new investment opportunities and growth for rural U.S. agribusinesses.

In April 2015, Secretary Vilsack announced the launch of the $100 million Meritus Kirchner RBIC II and the $25 million Innova Ag Innovation Fund. At the time, Mr. Vilsack said in an interview with the New York Times that there ‘tremendous demand’ for ag-related investments from entrepreneurs, venture capitalists, endowments, and pension funds. “The financial sector’s interest in agricultural-related investments has grown in recent years,” he states, adding, “There is a growing awareness of opportunity there and a lot of demand from the pension side.”

The first RBIC announced April 2014 as part of the Obama Administration’s ‘Made in Rural America’ exports and investment initiative was the $150 million Advantage Capital Agribusiness Fund, which to date has made investments in Iowa-based cage-free egg operation, Iowa Cage-Free, California-based precision irrigation company, Hortau, Oregon-based agricultural feedstock supply business, Pacific Ag, and bulk herb and botanical product supplier, American Botanicals.

Founded in Effingham, Illinois in 1997 by agribusiness leader, Jim Schultz, Open Prairie is a private equity management firm that has aimed to increase the availability of capital for the U.S. Midwest. This newest RBIC will invest in small agricultural enterprises engaged in agricultural production, crop protection, processing, precision agriculture, and information and data management.

“The RBIC program is a natural extension of our long term vision,” said Open Prairie partner and vice president Jason Wrone in a recent USDA press release. “We live, breathe and believe strongly in rural America and are pleased to be working with USDA, the Farm Credit System and other entities that share our passion for building successful companies that have a meaningful impact on their respective business sectors and the communities in which they do business.”