Just imagine: you are living in the scenic Hudson Valley and you have a small food or beverage company practically bursting with potential, ready to be discovered and jump to the next rung of success. What if the only thing stopping you was the small matter of investment (much!) larger than a tip jar’s worth?
You may ask, is there a person with a food job who could help, could there be a food venture capitalist? Yes. While big name venture capitalists elsewhere gingerly test the F&B (food and beverage) investment waters, Hudson River Ventures in the Hudson Valley has already jumped in with great success. May I introduce you to Mike Oates, CEO of Hudson River Ventures, who with President and venture founder, Sean Eldridge, represents one of savviest food and beverage investment funds west of the Hudson River?
Q: As a food venture capitalist, you have a rather unique food job. Why did you and Sean decide to start this investment fund?
A: Sean started Hudson River Ventures, LLC in 2011 with the goal of helping small businesses specifically in the Hudson Valley get access to capital to grow their businesses. We’re determined to empower entrepreneurs and build thriving businesses in our region. F&B and how it intersects with tourism, agriculture, and hospitality sectors was a logical place to start.
We’re a double-bottom line business. We’re for-profit, but we are also motivated by a desire to grow our local economy and create jobs in our region. Our fund makes investments ranging from $50,000 to $500,000 in either debt or equity positions. This is generally the range of capital many F&B companies are seeking.
We think we have the best job in the world. We get to eat and drink our way throughout the Hudson Valley!
Q: How did you get started in this area? Were you a foodie or an investor first? Did your last name have anything to do with it?
A: I do consider myself a foodie, though admittedly the last name came first. Before joining Hudson River Ventures, I had experience managing economic development organizations in New York State but I also had a marketing background in the distilled spirits world, namely with Bacardi and Anheuser-Busch. This has helped us evaluate our investments with a special understanding of the industry.
Q: How do you stay clear-eyed when choosing to invest in a local food or beverage company?
A: Any good investment will come down to answering three vital questions. First, does the company have a solid management and workforce team? Second, does the company have a sound business plan and do they have the tools to execute that plan? Finally, does the company have a high quality product? In the deals we’ve closed, the answers have been ‘yes’ to all these questions.
Q: Does Hudson River Ventures stay involved with these companies after investing in them?
A: Yes. This is a critical component Hudson River Ventures brings to the table. Not only do we provide capital, we also provide business-mentoring support. The capital is extremely important to advance a project, yet we believe our mentoring support can be equally valuable. We provide a variety of services and advice including: marketing, sales, distribution, logistics, HR, and real estate to name a few.
Q: Is investing in a food or beverage company different from say, investing in real estate?
A: Yes. Real estate can be cut and dry. F&B companies provide the human story you can’t beat. We get to invest in creative people who have a passion for what they do. What can be better than that? Our projects create jobs while helping to grow and diversify the region’s economy.
Q: Can you name a few of the F&B companies Hudson River Ventures has invested in?
A: I’m always eager to talk about the companies we’ve partnered. Each has a unique story or quality. If I could highlight four, they’d be: Hudson Chocolates; Bread Alone; Continental Organics and Poppy’s Burgers and Fries. In each case, we provided the capital to help the company expand and purchase equipment critical to its success. In return, the Hudson Valley has become much more than a region of great tastes. It has added jobs and diversity.
Hudson Chocolates produces the finest artisanal chocolates in the market today, created under the expert eye and palate of master chocolatier and Culinary Institute of America pastry and baking instructor Francisco J. Migoya. In 2013, Migoya was named one of the “Top 10 Pastry Chefs” by Huffington Post.
Bread Alone now has been able to expand into a state-of-the-art new manufacturing facility in Ulster County, after a thirty-year track record of success. Bread Alone Bakery co-owner and baker, Daniel Leader also is a graduate of The Culinary Institute of America who graduated at the top of his class.
Continental Organics used the capital it received to expand its large-scale aquaponics production facility in Orange County. The company is a service-disabled Veteran Owned Small Business, committed to producing fresh, organic, locally grown food and hiring 120 full-time employees – with at least 51% of whom will be veterans or disabled veterans.
Poppy’s Burgers & Fries was able to remodel and expand the restaurant founded in 2009 in Beacon, NY. Poppy’s opened with a mission to “stay local”: provide affordable, farm fresh food in a casual environment. Poppy’s uses local purveyors to support the local economy while providing the consumer with quality food packaged in 100% recyclable materials.
A: One of the Hudson Valley’s great strengths is the growing farm-to-table movement. We see our investments in companies like Gigi’s Hudson Valley, RiverMarket Kitchen and Bar, Poppy’s Burgers & Fries, and Continental Organics as both embracing and enabling this movement. We have outstanding, locally produced food that is better tasting and better for you. By promoting these and other companies like them, we think we can help drive the farm-to-table movement in this region to the next level. We also want to show other investors how well our model works and invite them to invest here in the Hudson Valley.
Q: Lastly, what advice would you give others who wanted to follow in your footsteps and invest in F&B companies in their communities?
A: I say, check out the Hudson Valley. We have great entrepreneurs who have terrific products and innovative companies. There are 68 million people living within a six-hour drive of the area, so there’s a tremendous market for any products produced in the Hudson Valley.
We like to say:
Come invest in the Hudson Valley – Come for the food, Stay for the investments!