LongWater, a private markets investment firm with deep Midwestern roots, has closed its inaugural SBIC fund at $262.5 million—exceeding its target and expanding the firm’s capacity to finance lower middle‑market companies across the country.
While the company has not announced Minnesota‑specific investments, it maintains a major office in Fargo, placing it close to Minnesota’s dense concentration of founder‑led manufacturing, food and business‑services companies. Those sectors align closely with LongWater’s investment strategy and the firm has evaluated opportunities in the state as part of its broader Midwest activity.
(Fun fact: The nation’s first SBIC fund of this type was generated by Alan “Buddy” Ruvelson of Minnapolis in the 1950s. It led to the city becoming one of the nation’s hotest private equity and micro-cap stoc markets in the 1990s. More here.)
The new fund is the first SBIC vehicle within LongWater’s Capital Solutions platform. It focuses on direct private credit and non‑control equity investments, partnering with private equity sponsors and management teams seeking flexible capital solutions. The fund combines private commitments with leverage from the U.S. Small Business Administration’s Small Business Investment Company (SBIC) program, which increases its ability to support smaller companies that often struggle to access traditional financing.
Investor interest was strong: approximately 40 percent of participants were first‑time investors in the SBIC program, including banks, family offices, insurance companies, institutional investors and high‑net‑worth individuals. To date, the fund has deployed capital into eight companies nationwide.
Senior Managing Director Kevin Prunty called the close “an important milestone for our firm, our partners and for the lower middle market businesses we exist to serve,” emphasizing LongWater’s focus on speed, flexibility and relationship‑driven execution.
Founded in 2009, LongWater operates from Fargo, Dallas and St. Louis and manages roughly $1 billion in regulatory assets for more than 220 investors. With the new SBIC fund in place, the firm is positioned to continue expanding its reach across the Midwest—potentially including Minnesota companies navigating ownership transitions, growth financing needs and shifting capital markets.
(Source here.)
