On today’s episode of THE FINANCIAL COMMUTE, host Chris Galeski welcomes Rich Gammill, Managing Partner of Proterra Investment Partners, an alternative investment firm focused on private equity investments in the natural resource sectors of agriculture, food, metals, and mining. 

Proterra originated in the food and agricultural space under Cargill. After splitting from Cargill, they partnered with Farm Credit, an independent federal agency, to create a unitranche lending solution for food businesses that may not have access to traditional bank loans. Farm Credit is not a deposit-based bank; they fund themselves through the issuance of bonds. Rich says Farm Credit is a mission-oriented, member-owned cooperative providing a wide range of financial services to support agriculture, including loans for land purchases, operating expenses, equipment financing, etc. 

Proterra helps Farm Credit reach branded food companies that have pricing power and control over their gross margins, providing reliable cash flow streams and defensive qualities- even during challenging times like the pandemic. Proterra does not lend to farmers because the market decides the prices of commodities, which can be volatile and unpredictable. Therefore, Rich says even though their investors may take on more illiquidity, they can generally expect more return and minimized risk. 

Proterra's focus on food lending offers a specialized and niche investment opportunity in the broader financial landscape while emphasizing responsible investing, considering environmental, social, and governance (ESG) factors.

Disclosure:  

Information presented herein is for discussion and illustrative purposes only. The views and opinions expressed by the speakers are as of the date of the recording and are subject to change. These views are not intended as a recommendation to buy or sell any securities, and should not be relied on as financial, tax or legal advice. Target returns or other forecasts contained herein are based upon subjective estimates and should not be construed as providing any assurance as to the results that may be realized in the future from investments. Many factors affect performance including changes in market conditions and interest rates and changes in response to other economic, political, or financial developments. Past results are no guarantee of future results. All investments involve risk, including the loss of principal.  You should consult with your financial, legal, and tax professionals before implementing any transactions and/or strategies concerning your finances.