Where would Greater Minnesota be without the Minnesota Initiative Foundations (MIFs)? Six MIFs have served the regions beyond the Twin Cities since 1986, working to address economic, environmental, cultural, and social needs. Backed by the McKnight Foundation, the MIFs have added nearly $1.7 billion in 40 years to their areas through grants, investments, and capital attraction from government, other foundations, businesses, and individuals.
Now part of the fabric of the state’s economy, the MIFs addressed a deep need when they were created. Minnesota was in rough shape in the mid-1980s. Major industries like mining and manufacturing were on the ropes, paired with a raging farm crisis. People had been fleeing rural areas for years, fed up with mass layoffs and a lack of opportunity. Downtowns were struggling, and there was little hope for a brighter future.
The McKnight Foundation set out to help. Its staff spent a year talking with rural residents, business owners, and local and tribal leaders across Minnesota about what they needed most. McKnight leaders realized that a cookie-cutter approach to problem solving would be ineffective. In 1986, McKnight provided seed funding to launch Minnesota Initiative Foundations in six regions. Since then, local leaders have operated the MIFs as independent entities, determining how to best support people and communities in their region.
Tapping into local insight and ingenuity became the driver as McKnight developed the regional MIFs, says Ben Goldfarb, director of strategic initiatives, democracy, media, and policy at McKnight. “It all started with trusting people and places to make good decisions when they have the resources. The brilliance was the simplicity and recognition that people close to the challenges are the ones who know what the potential solutions are,” Goldfarb says. “We feel very strongly that this is one of the most consequential things we’ve ever done as we’ve seen the MIFs grow into incredible impactful, place-based organizations.”
The six Initiative Foundations have served as integral partners for Enterprise Minnesota as it works to advocate for manufacturers and help them thrive, says Mark O’Leary, president and CEO of Enterprise Minnesota. This spirit of collaboration with manufacturers, other industries, and community partners has made the MIFs essential assets to Minnesota’s economy for the last 40 years.
“Small businesses, entrepreneurs, and manufacturers have benefited from the foundations’ work across the state to keep small cities and towns vibrant places to live and work,” O’Leary says. “The Initiative Foundations and their mission to support the economies of Greater Minnesota have made a real difference in every corner of the state.”
The six MIFs — Northland Foundation, Northwest Minnesota Foundation, West Central Initiative, Initiative Foundation in central Minnesota, Southern Minnesota Initiative Foundation, and Southwest Initiative Foundation — have many core functions in common. They provide financing to established and startup businesses, fund philanthropic ventures, and serve as cheerleaders for their regions, coalescing the support of state and federal government and other partners to better their communities.
Since 1986, the Minnesota Initiative Foundations have distributed $439 million in grants to communities statewide, made $364.1 million in local business investments, and attracted $876 million from government, other foundations, businesses, and individuals to Greater Minnesota. MIFs address regional and statewide issues including childcare, housing, downtown revitalization, climate change, belonging, and leadership development.
“There is no question that across Greater Minnesota, you can go town by town and see that MIFs have played a direct role in slowing and stopping — and, in some ways, reversing — the population decline,” Goldfarb says. “There is an enthusiasm and pride. Main Streets are hopping, there are new businesses with beautiful facades and public arts, and people are proud to be from there.”
The tide has turned, and people now see more opportunities and brighter futures in Greater Minnesota. “There is no question that the MIFs have built the platform where regions can be stabilized and have the potential to grow,” Goldfarb says. “They have made it possible for people who love a place and want to raise a family there to stay and invest and connect. That’s a huge legacy.”
Here’s a look at what each of the MIFs has achieved since 1986.
Brian Voerding
President of the Initiative Foundation in Little Falls. It serves 14 counties and two Native American nations, reaching 750,000 central Minnesota residents.
What have been the Initiative Foundation’s biggest impacts?
Brian: The most meaningful work we have done across the region is helping support folks with the right resources at the right time to move good work forward. Sometimes it’s a grant or a loan or a workshop or a connection. We are here to listen deeply, understand the needs, and build an organization to be as responsive and nimble as we can. Whatever people have needed in central Minnesota, we have worked to deliver it to them to turn their vision into reality.
How has the foundation helped manufacturers?
Brian: We support entrepreneurs and specifically local manufacturers by delivering capital and giving them resources they need to do work, have better access to new markets, take on new product lines, and build new facilities. Some of our first loans were to small manufacturers. Manufacturing is a big job base and a critical part of our region. It creates really good jobs that support families and opportunities for community investment. We have tried to be a real difference maker for manufacturers.
How has the Initiative Foundation made an impact through partnerships?
Brian: We have close partnerships with the technical and community colleges, and we work with them on developing workforce solutions. Then there are partnerships with community banks and lenders, and organizations like the Central Minnesota Manufacturers Association and the Central Minnesota Jobs and Training Services.
We have a revolving loan fund and one of the oldest CDFIs [Community Development Financial Institutions] in the country. It provides gap lending and has been a core part of our work. Community banks often can’t lend 100% of what businesses need to grow and may not be able to serve brand-new entrepreneurs, so we are ready to provide direct and gap loans to help. We have provided access to advanced training through Enterprise Minnesota, and cost-share grants and funding that small manufacturers need for professional development and to grow skills at their companies. We also support succession planning. There is a tradition of homegrown manufacturing and multigenerational manufacturing in central Minnesota, and we are eager to help keep that here.
How else does the foundation contribute to life in central Minnesota?
Brian: We’re supporting structural things like childcare, nonprofits, downtowns, arts and culture — the things that make communities strong and vital. We also support people. We have the Thriving Communities program, where we train small-town leaders and residents to bring people together and take action. It’s one of our most successful programs.
What are you looking forward to most about the foundation’s work?
Brian: One of the undertold stories of central Minnesota and rural Minnesota is that there is incredibly strong, vital work happening every day. In an era of division and isolation and polarization, these things are here, but they are not preventing people from doing this work. We have a strong shared vision of the future. That gives me tons of excitement about the future. This region is connected and caring, and people are coming together because they believe in this place.
Anna Wasescha
President of West Central Initiative. Based in Fergus Falls, West Central Initiative serves 236,500 people in nine counties and one Native nation.
How does the West Central Initiative approach its work?
Anna: West Central Initiative is a community foundation, so we raise money and help communities raise money — then we grant it to support projects designed to improve people’s lives in our region. One of the ways we’re different from the other Minnesota Initiative Foundations is that in the early 1990s, we became a regional development organization. We took on that role because it’s nearly impossible to get the federal government to allocate funds for large infrastructure projects, such as wastewater treatment plants, without a regional development plan. Our superpower is turning data into action. We gather and interpret information about our region, then use those insights to shape our philanthropic strategy, resulting in stronger planning and more effective giving.
What does West Central focus on?
Anna: Our work is centered on four priorities: climate, democracy, rural belonging, and civic engagement. We work on childcare availability and affordability. We do transportation planning for the region. That work includes projects such as roundabouts, bike lanes, trails, and Safe Routes to School. We offer a full array of ways to encourage people to be civically engaged. One of those programs is Run4Rural, which teaches people how to run for office. And we host an annual Rural Democracy Summit to spotlight ways to build networks of citizens actively participating in their communities.
What is the role of manufacturing in west-central Minnesota?
Anna: Health care and government make up the largest sectors of our economy, but manufacturing is everywhere — in small towns and big towns alike. It’s a durable, fundamental sector that fuels small-town vitality. A lot of value-added food products come from here, including cheese, potato chips, pet food, and candy. Ethanol is produced in this region, and on the horizon are developments in sustainable aviation fuel and green ammonia.
How does the foundation work with partners?
Anna: Partnerships are the only way we’ll be successful, and we have many of them. The University of Minnesota is an important partner, especially for our climate programs. One of our employees serves in a shared position with the Minnesota Climate Adaptation Partnership. That group is developing tools to help communities and sectors, such as agriculture, adapt to a changing climate and extreme weather.
What is the foundation planning to work on in the future?
Anna: Our love of this region guides everything we do, and that means we need to continuously learn and adapt as things change. When we see an opportunity to strengthen the region and no one else is positioned to lead, and we have or can get the skills, we’re going to step in and do it. We have strong financial systems and a staff who love their work, is always curious, and is doing more and better things. We also host five interns and fellows. These are the people who will be building the future, and we can help them get started with real-world experience.
Karen White
President/CEO of the Northwest Minnesota Foundation, based in Bemidji. It serves 169,400 people in 12 counties and two Native nations.
What is the economic landscape in northwestern Minnesota?
Karen: Our region is as large as six or seven states, and our population is approximately 170,000, so we’re sparsely populated. On the west side, manufacturing is a major industry, with large legacy manufacturers like Marvin, Polaris, Arctic Cat, and DigiKey (technically a logistics and distribution company). Employment on the east side is more driven by tourism, government, health care, and some timber and logging. We work to strengthen and stabilize communities by helping them realize their own goals through local giving and supporting philanthropy.
What are some of the key areas the foundation addresses?
Karen: Part of our organization is being a community foundation, and we hold almost 450 funds. Through that and our programs, we work to be a stabilizing force in child care, housing, ending homelessness, and small business and entrepreneur development through lending and providing technical assistance to businesses. We are working to understand services for aging and elder care. We see that as very critical for the success of communities. We have some partnerships with manufacturing companies on helping new residents feel welcome and connected to their communities.
Where are community funds being distributed?
Karen: They are a mix of fund types. One type of fund is scholarships. We support about $350,000 in scholarships for graduates annually. We’re trying to keep their connection to our region so if they move away for school, they come back again. We also have 24 community funds that have been developing assets over the years to support nonprofits and larger projects. One example is in Fertile. Friends of the Fair in Pope County decided to turn it into a year-round community facility with childcare, a walking track, and a larger food shelf. We’re here to help communities with that kind of vision. In 40 years, we have awarded over $65 million in grants and $35 million in loan capital to small businesses.
How has the foundation made an impact?
Karen: There was a devastating flood in Roseau in 2002, and we were one of the first to provide assistance for small businesses. We created special loan products to help them stay afloat as they were getting back to normal. We’ve done that with other disasters, like when the derecho went through Bemidji last year. We’re here, and we know what is happening. We try to be some of the first resources for communities to tap into after something bad happens.
What will you focus on in the future?
Karen: We are wrapping up our first year with a new strategic framework. We’ve keyed in on what is essential for northwest Minnesota and our communities — the people and the connections among them and to their natural environment and to their communities. We think that we build vibrant communities by welcoming newcomers and fostering inclusive relationships. Safe and affordable housing and a strong economy, livable wages and care for all stages of life, childcare, elder care, belonging, and cultural heritage are very important to us. We’re also interested in environmental resilience and disaster recovery. We really lean on the core tools in our toolbox, which are grantmaking and loans, and we can activate those quickly because we’ve been doing it for 40 years.
Scott Marquardt
President of the Southwest Initiative Foundation. Based in Hutchinson, it serves 280,000 people in 18 counties and two Native nations.
What is the foundation’s approach to serving your region?
Scott: Our region is where agriculture and bioscience and manufacturing align, so there is a lot of beautiful growth with agriculture-related processing businesses and ag biotech. A priority for us has been rural entrepreneurship, micro loans, and business loans. We are a community foundation by charter, with 31 affiliate community foundations plus dozens of other donor-advised funds, designated funds, and economic development work. We work with private and public donor money and community banks. Our secret weapon that I hope to take to the next level is the relationship between philanthropy and economic development.
How do you unite philanthropy and economic development?
Scott: We bring in infrastructure so that the local communities can have their own community foundation without needing an independent staff and overhead. We provide all of that because there is such a passion for giving locally. I’m hoping we can reimagine donor-advised funds and ways for folks who have had business success to use their charitable dollars to reinvest in other businesses. It’s a different way to engage in philanthropy, but we have the system in place for that.
How does the foundation partner with manufacturing?
Scott: The Southwest Initiative Foundation and the Southern Minnesota Initiative Foundation did a study of the southern Minnesota economy, and we learned that we have a disproportionate share of manufacturing jobs. Ten years ago, 20% of the jobs in the region were in manufacturing. That data still informs our loan policies today. We make loans to small and medium manufacturers with financing for startups or expansions. We also support infrastructure organizations like chambers of commerce and economic development agencies, groups that support manufacturers, and things like childcare and housing that manufacturers need for their employees.
What else will SWIF focus on in the future?
Scott: We’re going to launch our Community Development Financial Institutions fund. Our loan fund is at the highest level of deployment, with 22% of our lifetime loan volume in the last 40 years on our books now. If someone gave us $2 million to do more economic development loans, I could have it out in a month for startups, expansions, and ownership transitions. Good things are happening in our region; we’re seeing a lot of activity around childcare and around critical community needs; we’re retaining grocery stores, veterinarians, plumbers, and welders in the three-digit-population towns. If you lose those businesses, those small towns hurt.
How has the foundation most helped your region?
Scott: Access to capital for 40 years has been a big piece. I think we were the capital that made some projects get across the finish line. Also, our investments in leadership development for the next generation of leaders and childcare. I became the president three years ago, and the childcare shortage is the biggest reason I get calls. I’m also proud of our community foundations and donor-advised funds that have made an impact in their own way. We’ve done well over 1,000 loans.
Benya Kraus
President and CEO of the Southern Minnesota Initiative Foundation in Owatonna. It covers 20 counties in south-central and southeastern Minnesota and one Native nation, serving 755,000 people.
How has the Southern Minnesota Initiative Foundation evolved its work in the past 40 years?
Benya: We made our first loan in 1987, and several of our first clients are still growing and thriving. Our key roles are being a lender with a big focus on community impact, and we have a grantmaking role that has evolved. We’re focusing on grants to small towns to bring different parts of the community together to solve shared challenges. Our third area is being a connector, convenor, and capital builder (3Cs). We recently did a 3C around early childhood where we’re supporting providers with training and different business models so that we can solve the childcare shortage. We’re also working with entrepreneurs, doing lending, capacity building, and training to strengthen their businesses and connect them to the right resources.
How do your initiatives with entrepreneurs work?
Benya: One recent program was our Rural Entrepreneurial Venture program. Small towns would enter a cohort training model. We helped communities see how they can get more resources to entrepreneurs, whether that was helping them start a revolving loan fund or storefront beautification grants or do business-supporting events. Sometimes we provided technical assistance like developing financial statements or a marketing strategy — things that could be tailored to their needs.
What are some of the foundation’s biggest accomplishments?
Benya: Some of our proudest achievements are providing capital access for businesses and entrepreneurs and keeping that wealth local. One of our first loan clients was Valley Design in Fountain. It’s building and selling table bases across the country and the world. Local high schoolers do summer internships there. The founding owner’s son is taking over the business; he’s a volunteer firefighter and on the local economic development agency. This speaks to the role that capital can play in supporting and sustaining our businesses. When they succeed, families grow their roots and contribute by volunteering and supporting the next generation of workers in their region.
How else has the foundation helped southern Minnesota?
Benya: It’s both the work and the relationships that the work has unlocked. When we invest in businesses, we also see them invest in the needs of their community — whether it be through childcare, the community foundation, housing, or downtown revitalization. That relationship between a business and the community they’re a part of is vital to sustaining a strong, vibrant southern Minnesota. That’s how we get the region to thrive — by having everyone see their stake in the future of our place.
What’s next for the foundation?
Benya: I’m interested in entrepreneurship through acquisition and what that means as the baby boomers in our region age. How do we make sure we don’t lose an entire generation of locally owned businesses? That means doing succession planning and finding tools that encourage and make it possible for the next generation to buy these businesses. Across our region and in Greater Minnesota, we’re seeing this brain gain of young families choosing rural communities. How do we make sure that they are places they can call home, with childcare and a strong education system? How do our small towns have an identity that they feel they can be a part of? That sense of belonging for this next generation is really important.
Tony Sertich
President/CEO of the Northland Foundation. The Duluth-based foundation serves 325,700 people in five Native nations and seven Minnesota counties.
How does the Northland Foundation approach its work?
Tony: We serve a quarter of the land mass of Minnesota, with only 325,000 people. It’s as rural as you get per capita. We’ve taken to heart the McKnight Foundation belief that there are unique assets in different parts of the state, strengths and challenges, and incredible people. That means not being top-down and assuming that the same approach will work everywhere. That has led us to three legs of a stool for our work: Grantmaking in priority areas, business services, and programming primarily focused on youth and childcare. We have a gap financing program, and we took over administering the Small Business Development Center for the region, so we can provide technical support that businesses need to get established or grow.
What are your biggest priorities?
Tony: We look at what it takes to be healthy, thriving rural communities. We give grants to nonprofits doing basic needs, a lot of work around issues for kids and families, and the economy. We need every able-bodied person in the workforce to contribute to a healthy society and gain dignity from work. We want to help with the barrier of having an early childhood [provider] desert in this region. We know how important that is for rural communities to own their own futures. A big part of that are the businesses that are owned and operated by our friends and neighbors and ourselves. When people have good ideas, they can take it from their workbench to scaling it up, and we can help with that.
Where has the foundation made the biggest impact?
Tony: We’re most proud of going back to the value that local communities know what is best for themselves, developing relationships in a region about the size of West Virginia with communities and the sovereign nations that we share the land with. Hopefully we have been a committed partner to stand by their side and support them, whether with a business loan or grant or assistance to help a childcare center that was on the brink. It’s being that reliable partner for 40 years.
How does Northland work with manufacturers and other partners?
Tony: Manufacturing is such an important sector for the economy in our state and region. We provide technical assistance or loan capital to help manufacturers purchase equipment and find opportunities to expand. We partner with a lot of banks and nontraditional lenders and other economic development folks. We try to make sure we hand folks off to the right resources that can help.
What will Northland focus on in the future?
Tony: It’s a lot more of the same: showing up for communities and seeing what they need. The needs of our communities might feel the same as they did 40 years ago. We always want well-paying jobs, and we still need people in the communities to fill them. Childcare and housing need unique solutions based on where you are. We have to see what the communities need. We’re going to continue to be that flexible partner to come in and support their vision.
Return to the Fall 2026 issue of Enterprise Minnesota® magazine.
