FARGO — North Dakota needs to diversify its economy to buffer itself from the ups and downs of the “roller coaster of commodities,” according to the President and CEO of the Bank of North Dakota.
That’s why Eric Hardmeyer said the bank has spent more than a year thinking about the role it can play in diversifying the economy, and they have a plan that could help.
“As we looked at it, we decided what better way than to help entrepreneurs and businesses develop?” he said.
Hardmeyer and Jay Schuler, director of the North Dakota Department of Commerce, discussed the steps their organizations are taking Wednesday, May 17, during the 1 Million Cups weekly event to connect and support entrepreneurs at The Stage at Island Park in Fargo.
The 1 Million Cups program first came to the state in Bismarck in the fall of 2013 and got its start in early 2014. Local organizer Greg Tehven said Wednesday’s event was the biggest one yet in North Dakota, drawing a crowd of about 284.
Many more watched the presentation as it was livestreamed by Forum Communications Co. to viewing parties around the state.
Hardmeyer said the Bank of North Dakota’s unique status as the only state-owned bank gives it the flexibility to be an “agile partner” to find financial solutions for current and emerging needs, including the need to diversify.
Because it isn’t subject to the same federal regulations as other banks, he said, it’s able to have a direct venture capital fund that other banks can’t offer.
Bank officials held 40 meetings across the state last year to identify key needs and come up with solutions, including a new program that was announced May 1.
The Accelerated Growth Loan Program is an addition to Bank of North Dakota’s loan portfolio, giving North Dakota-based companies a new way to get cash flow even if they don’t have bankable collateral.
“We recognize that that’s the lifeblood of a company is access to capital,” Hardmeyer said.
He said the bank already had a $15 million fund to be used in conjunction with its development fund, but after conducting the statewide meetings, officials decided to devote about $1.5 million of that into seed capital.
While Bank of North Dakota wouldn’t be the primary investor through this program, he said it has the money to help address this funding gap and give entrepreneurs another tool to grow their companies.
The bank also revamped its guidelines for four existing programs, including an increased limit for the Beginning Entrepreneur Loan Guarantee program.
When asked what people at 1 Million Cups could do to support the efforts of the Bank of North Dakota and the Department of Commerce in helping entrepreneurs, Schuler said it’s important to tap into the programs offered for emerging business leaders.
“The environment that you’ve got here in Fago needs to be multiplied out over the whole state because entrepreneurs talking to entrepreneurs come up with fantastic ideas,” he said.