Yellow Pages
As if their business of turning cow manure into energy wasn’t unique enough, Farm Power Northwest LLC is now raising capital for future projects through a funding source few small companies consider.
Farm Power is one of two businesses in the state currently registered to offer shares to the public through a state program catering to small companies. The Small Company Offering Registration program allows businesses to do their own paperwork for a securities offering instead of hiring a lawyer, which wouldn’t be cost-effective for businesses looking to raise less than $1 million.
The company is required to explain its business plan and make disclosures the same as in other securities offerings, but the program walks them through the paperwork with a question-and-answer format.
Farm Power already has 21 local investors that put money into the company’s early stages, but the Skagit-raised brothers who started the company are looking for more people in the community who’d like to own a piece.
“We would much rather be controlled by several dozen of our neighbors that have the same goals we do — preserving farmland in the valley, keeping businesses here,” said Daryl Maas, co-founder of the company with his brother Kevin. “It’s more work than finding just one big rich person, but we think it will be better in the long-term for our company and the community.”
How it works
Farm Power’s approach to producing energy started with a view of the long-term, with a closed-loop process that uses waste instead of producing it. The company launched its first location, Farm Power Rexville in Mount Vernon, between two dairy farms on Beaver Marsh Road a year ago.
Manure pumped from the two farms along with food waste from other processors enters an anaerobic digester, which simulates a cow’s stomach at 100 degrees to accelerate the production of methane gas. That gas is burned to power a generator and create electricity, which the facility sells to Puget Sound Energy.
The dairy farmers receive in return a leftover, scent-free fiber product they use as bedding for the cows — saving them up to $10,000 a month on having to purchase it — as well as the processed manure to fertilize their fields. Since the process is considered “carbon negative,” Farm Power also can sell carbon credits to other companies who want to offset their output.
How it sells
Eric Shen of Anacortes invested in Farm Power’s concept two years ago before the Rexville facility was a reality — and he plans to invest in this round as well.
The company paid that first round of investors $12 a share in dividends a few months back, said Daryl Maas. Shen said his original investment was more about supporting the concept of renewable energy, while his second investment is equally based on the hope of good returns.
“This is one of the few investments that seemed to address many issues at one time as well as having the potential to make a good financial return,” Shen said.
Kevin Maas told a group of potential investors during a tour Tuesday that he’d like to see more local people jump on board.
“We would like to see empowered investors say ‘I want to invest locally,’” instead of in distant companies through mutual funds, Kevin Maas told the group.
As the company continues construction on a second facility in Lynden and makes plans for two more in Enumclaw and Tillamook, Ore., it needs that investor backing to fill in the gaps.
Money from the federal stimulus package has funded large chunks of the existing facilities, which cost $3 million to $5 million to build. But the company needs a combination of federal and state grants, bank loans and investor financing to continue moving forward on projects.
The shares offering is intended to raise $750,000 from up to 50 investors. There are income requirements for investors, and the minimum investment is $7,500. Detailed information about the offering is available through a link at http://www.farmpower.com.
Read more local news in the Skagit Valley Herald and the Anacortes American, or read it online in the E-edition
