A number of new terms have been added to the global lexicon in 2020. Coronavirus, social distancing, and hybrid learning have become part of our common language in a way that no one could have expected 12 months ago. In early August, Iowans added another little known term to that list: Derecho.
Defined as a “widespread, long-lived wind event,” a derecho typically causes damage in one direction along a relatively straight path. On August 10, a derecho swept through 770 miles across four US states and resulted in the costliest thunderstorm event in US history, with estimates of more than $7.5 billion in damage. In Iowa, at least 14 million crop acres were impacted, with 850 acres of crops flattened. In addition, an estimated 57 million bushels of grain storage capacity were damaged or destroyed.
However, the state’s leaders see the rapid response to the derecho as just one example of the resiliency of Iowa’s farmers, communities, and businesses. Each day, progress is made to rebuild from storms and recover from the Covid-19 pandemic and other challenges – and then to prepare for growth opportunities.
“Iowa is uniquely positioned to work through the challenging times we are currently experiencing,” said Iowa Governor Kim Reynolds. “The combination of the strength of our agriculture sector, thriving startup and entrepreneurial ecosystem, and a business-friendly state are paving a smoother path to economic recovery than is happening in many places.”
Agricultural strength
With one in five jobs in Iowa connected to agriculture and more than 85% of the land used for agriculture, there is no question the role that the sector plays in the state’s economy and communities. Iowa’s farmers lead the US in production of corn, pigs, and eggs, and are in the top 10 for soybeans, commercial red meat, cattle, cheese, and turkey production.
“There is no doubt that 2020 has been a challenging year for Iowa agriculture, with health concerns and market disruptions caused by the Covid-19 pandemic, millions of acres of damaged crops from the historic derecho storm, and drought conditions across much of the state,” said Iowa Secretary of Agriculture Mike Naig. “However, we have the advantage of being in a fiscally strong and well-managed state, and Iowa’s agriculture sector will weather our current storm and emerge in a stronger position for sustainable growth in the future.”
The innovation that has always driven farmers and the ag industry to improve production and sustainability every year is even more important in a time when both market and weather conditions are challenging profitability.
“Iowa is unique that we have a leading land grant institution with Iowa State University, world class ag and bioscience businesses, a growing startup community, and some of the most innovative and productive farmers in the world – all within close proximity of each other,” Naig said. “It is an ecosystem that fosters success.”
Entrepreneurial ecosystem
Iowa’s startup community also continues to move ahead. In fact, investments in Iowa startups in the first three quarters of 2020 have already doubled the total amount raised by Iowa companies in 2019.
“Iowa has created a supportive culture for innovation, and companies and entrepreneurs are stepping up with new ideas and technologies that will drive opportunities in agriculture, bioscience, biofuels, and more,” said Debi Durham, director of the Iowa Economic Development Authority and the Iowa Finance Authority, noting that the Iowa legislature created the first biochemical production tax credit in 2016.
A comprehensive offering of mentorship and training programs provide a framework for founders to take ideas from the marketplace. There are also loans available for any point in an entrepreneur’s journey — from demonstrating proof of relevance to expansion of product lines — in addition to tax credits for angel investors to accelerate business development. Programs are available to help companies navigate the application process for US federal funding through the Small Business Innovation Research and Small Business Technology Transfer programs.
“There is no better place to start or grow your ag or bioscience business,” said Durham.
Iowa’s skilled and educated workforce also provides an advantage to companies located in the state. More than 24,500 people are currently employed in the bioscience industry, with a strong pipeline of science and engineering graduates providing the foundation for continued growth.
More than 50 incubators, co-working spaces, and research parks across Iowa provide ag innovators room to grow their startups, and while quarantines and social distancing may have hindered some events, many have found success in pivots to virtual programming. The Iowa AgriTech Accelerator completed a virtual cohort and America’s Cultivation Corridor is transitioning its Cultivo Global Ag Innovation Program to a virtual format in 2021.
Positioned for growth
A strong economic position has boosted Iowa’s ability to support businesses. At the end of the 2020 fiscal year on June 30, the state had a budget surplus of $305 million that provided a solid foundation to help drive recovery from Covid-19.
The Governor’s Economic Recovery Advisory Board was formed in June 2020, bringing together business leaders from across Iowa to provide recommendations for modernizing the state’s economy as well as education, healthcare, workforce, and quality of life. The recovery plan will be released in Q4 2020, providing a roadmap for the state’s recovery and positioning for future growth.
Recommendations from the advisory board, in combination with existing programs like the Empower Rural Iowa Initiative, will continue drive the state’s priorities including rural broadband, infrastructure, and support for the biofuels sector.
“During the challenging times of 2020, we have focused on not just keeping businesses open, but also encouraging them to innovate and grow,” said Governor Reynolds. “There is a reason why startups in all sectors of food and agriculture find success in Iowa: Iowa isn’t just a place with agriculture; it is the place for agriculture.”
