Entrepreneurs Fuel Southwest Minnesota’s Dynamic Economy

By Scott Marquardt, President, Southwest Initiative Foundation

“At Southwest Initiative Foundation, our mission has always focused on what happens when rural communities are connected to opportunity and supported with the right tools. Entrepreneurs, business owners, and community leaders are the real drivers of change. Our role is to connect them and invest in their good ideas.”

Southwest Minnesota is undeniably farm country. Take a summer drive, and you’ll see beef herds grazing, row crops rippling under the sun, and vineyards heavy with grapes. Of the 7.9 million acres that make up our region, 77 percent is tillable farmland.

Our agricultural roots meant the 1986 farm crisis hit us particularly hard. While the memories of those difficult times remain, our heritage also means we are enterprising and resilient, two qualities that have helped us not only survive change but lead through it.

While agriculture plays a central role, it’s not the whole story. You might be surprised to learn that one in five workers in Southwest Minnesota is employed in manufacturing, anchoring local economies and supporting families across the region. More than 80 percent of our working age adults are employed, a testament to the strength and diversity of our labor force. And Worthington, one of our four largest communities in the region, is the second most diverse city per capita in Minnesota, with 44 percent of its residents identifying as people of color.

At Southwest Initiative Foundation, our mission has always focused on what happens when rural communities are connected to opportunity and supported with the right tools. Entrepreneurs, business owners, and community leaders are the real drivers of change. Our role is to connect them and invest in their good ideas.

Nowhere is that more evident than in our lending program. Since our founding, we have disbursed $62.5 million in loans, partnering with banks, credit unions, nonprofit lenders, economic development organizations, and private investors to help businesses start, grow, and adapt. Money alone isn’t always enough. In addition to capital, we support businesses through each stage of their journey.

One of those journeys belongs to Maria Parga.

When Maria Parga opened a video rental store in 1991, it was one of the first businesses in Worthington created specifically to serve the local Hispanic community. As her customers’ needs evolved, so did her business. She added Mexican groceries, gift items, wire services, and travel services, eventually transforming her vision into Mini Market Lupita, a bakery, restaurant, deli, and meat market that has become a community institution.

Southwest Initiative Foundation was there along the way. Our first loan to Maria in 2009 helped fund electrical and plumbing fixtures, equipment installation, and working capital. In 2016, she used additional loan funds, combined with a federal energy grant, to purchase new coolers and freezers. Today, her business remains strong, supports jobs, and anchors a vibrant commercial corridor.

Maria’s story reflects something we see again and again, that when rural entrepreneurs are given access to capital and trusted as decision makers, they deliver extraordinary results.

Immigrant and refugee owned businesses, along with many others navigating disruption, have reimagined rural main streets across our region. But these businesses are also facing real challenges. What our business owners experience ripples through families, suppliers, agricultural partners, and entire local economies. Strategic investment in small businesses is not charity; it is economic infrastructure.

That’s why we also partner with Kandiyohi County Economic Development and Rising Tide Capital to provide the Community Business Academy for prospective and existing entrepreneurs in the Willmar area. This 12-week course offers hands-on training in business planning and management. More than 100 people having graduated, with many more to come.

The Midwest Entrepreneurial Climate Survey, conducted in partnership with the University of Wisconsin Madison, shows that rural residents are outpacing their urban peers in entrepreneurial activity. More than half of rural respondents reported having owned, started, or discontinued a business, compared with just over a third of urban residents. Entrepreneurship is not an urban trend that occasionally reaches rural places. It’s embedded in the DNA of our communities.

We see that entrepreneurial spirit firsthand every day. Demand for business lending in Southwest Minnesota is at a historic high, driven by entrepreneurs launching startups, expanding operations, and planning for succession. More than 20 percent of all the lending we’ve done over the past 39 years is currently active in our portfolio.

That is an extraordinary moment, and a clear signal that rural economies are not winding down; they are moving forward. And so are we. Our emerging Community Development Financial Institution is pursuing federal CDFI certification to expand access to capital in our region, a long term investment in economic mobility, business resilience, and shared prosperity.

As we mark 40 years, we do so with gratitude for the partners, businesses, and communities that have made our work possible. And with optimism for what comes next.

Rural communities are not defined by what they lack, but by what they build together. For the past 40 years, we’ve seen what’s possible. The next 40 hold even more promise.

Learn more about Southwest Initiative Foundation and their work at swifoundation.org.