New Oregon law opens financial doors
Small-scale Oregon farmers and entrepreneurs are getting a helping hand from a state law that went into effect this year.
The law, which allows Oregon-based businesses to raise up to $250,000 from state residents, became effective in January. Called the Oregon Intrastate Offering Exemption, the law allows individuals to invest up to $2,500 per offering.
Amy Pearl, founder of Hatch Innovation Lab and the person who spearheaded passage of the new law in the legislature, said, “Local investing equals impact investing.” Oregon is the 14th state to establish an “intrastate crowd funding” law.
“We were the only state to launch the law with companies who had filed their material and were legal,” said Pearl. Every company defines their own terms, such as selling shares or offering convertible notes.
The nine companies and details of their investment offerings are available at HatchOregon — http://hatchoregon.com.
Five of the companies are involved in food and agriculture.
Red Wagon Creamery in Eugene is a handcrafted ice cream company that focuses on using local ingredients, highlighting seasonal fruits and fresh, local hormone-free milk.
Agrarian Farmhouse Ales outside Eugene is a small craft brewery that grows all its own herbs and hops — 15 different varieties — and sources other ingredients such as grains, chile peppers and honey from neighboring farms. It is working toward becoming a true estate brewery.
Both Red Wagon and Agrarian are offering shares of their company.
All Hatch projects are allowed 12 months to raise the funds with an option to extend for another 12 months. They must meet in person with a Local Business Technical Service Provider to review the business plan.
Once the offering materials are complete, including the reason for the raise, the team involved, the risks and benefits and the terms, the company will be listed on the web site within 7 days.
Ton Ton’s Artisan Affections in Talent sells grain-free, gluten-free cookies and fresh, homemade hummus. In its third year of business, owner Michael Antonopoulos, has both a low and high end goal for the public offering. He wants to high-pressure pasteurize the hummus to increase its shelf life and allow for conventional distribution. Depending on funds, this will happen in the shared rental kitchen or in his own production facility that he envisions as an incubator for the region. He is offering convertible notes.
So is Wylie’s Honey Brews in Phoenix. The company makes local artisan honey sodas sweetened with unheated raw honey using herbs and live enzyme cultures.
Gro-volution is a company that’s still in development. Gro-volution is a high-tech farming concept out of Klamath Falls started by Eric Wilson. He’s working on a unit called a PEA Pod that’s a refurbished, recycled and repurposed shipping container.
“We can take the farm and move it anywhere in the planet and have it close to the people who want it,” said Wilson.
The aeroponic growing technique uses an organic fiber recently approved by the FDA. “We’re trying to achieve close to 100 percent nutrient conversion,” said Wilson.
When entrepreneurs create the terms, the deals are more helpful, said Pearl. “That’s a dramatic difference from banks. We call it compatible capital.”
She sees high interest among farmers who are looking to expand, buy land and move into agritourism.
Todd Perlmeter, the general manager at Agrarian Ales, said the company has already raised $65,000. The first goal was $50,000 to help pay for permanent bathrooms and heaters for the tasting room. “We’ve already broken ground,” he said.
The next goal is $90,000 total to help with expansion of the brewery and hop yard. “We’ve decided to stop there because we’re going into our busy summer season when we have more cash flow. The Hatch offering is setting us up for success with more traditional loans and we may not have to offer up more equity to raise additional funds.”