Buying a Business in Agriculture

This is Tim Hammerich of the Ag Information Network with your Farm of the Future Report.

Purchasing a business in agriculture can come with both obstacles and opportunities. Trent Kubik, who bought what is now Elevate Agronomics, says that’s why it's crucial to have a supportive financing institution that understands and believes in what you’re doing.

Kubik… “The biggest thing I’ll say is for the purchase of the business and then to operate the business, is it has to be a really good financing institution, 100% bought into what you’re doing, 100% behind you, a bank that understands ag retail. Not every bank does, and we found that out fairly quickly, because we want somebody that understands that, we’re talking big money. I mean, there’s big ships, there’s grain bins, there slots of inventory. I mean, seven figures used to scare me and now a million dollars doesn’t go far anymore. So you have to have somebody that’s in your corner and like I said, that understands how the business works because you start putting these large dollar figures on paper and a lot of people look at that and go “Geez, you want us to loan you that much money and what do you put out for collateral?” They really like to see that so that’d be one advice if somebody was looking to do this type of thing, do your homework, don’t just settle for the first one that comes along, make sure that they’re willing and ready to partner with you, because it’s a leap of faith on our part and it’s a leap of faith on theirs too. Fortunately, they took with us and it’s worked out pretty well for both.”

Kubik and his brother now own and operate Elevate Agronomics in South Dakota.