For smaller enterprises, however, even modest grants can be transformative, Pheasant says. One artisan cheesemaker, for example, used a $100,000 award toward a cheese cutter that creates precisely measured wedges, eliminating an onerous manual task and allowing them to tap a new market that operates on uniformity and volume. And, because family, minority, and women-owned businesses often face greater challenges in securing capital, the funding can be “a real game changer,” she says, enabling them to compete at a far greater scale. “It’s a story that gets replicated through these small producers,” she adds.
“As an artisanal creamery, we need products that can really differentiate us from larger [operations],” says Todd Koch, owner of TMK Creamery in Canby, Oregon. Half an hour outside Portland, the 50-acre family farm is known for its ice cream and freshly churned cheddar, made from the milk of 20 pastured-grazed cows and sold a stone’s throw away at the farm stand and in a few local restaurants.
Several years ago, Koch collaborated with Oregon State University to develop a vodka distilled from whey, a byproduct of cheesemaking. “Cowcohol” has become one of TMK’s signature products, enabling the creamery to diversify with a premium, shelf-stable offering while minimizing a costly disposal problem.
Using a $140,000 DBII grant, TMK Creamery is now developing a filtration system to fully extract their whey’s remaining lipids and proteins—which are fed back to the cows, another savings. “It’s difficult for small businesses like us to be profitable,” Koch says. “A lot of people don’t understand why my cheese costs [four times more than] Walmart’s.”
“We’re an important fabric of these rural communities.”
These innovations often have ripple effects. At Nico’s Ice Cream, in Portland, Oregon, owner Nico Vergara concocts his frozen treats using a specialized blender imported from New Zealand. The machine swirls scoops of fresh fruit into the cream—both sourced from farms in nearby Willamette Valley—to create “a light and airy, soft-serve-y texture,” Pheasant says. “It’s one of a kind.”
In just three years, the 25-year-old entrepreneur, who started off with a seasonal pushcart, has opened two shops and now distributes pints to about 60 grocery stores in Oregon and Washington. Using a $40,000 DBII grant, he’s acquired an additional fleet of machines and is working toward nationwide distribution. With flavors that nod to Vergara’s Latino background, such as chamoy, a pickled fruit-and-pepper sauce, and Tajín, a brand of chili and lime seasoning, the company aims to broaden its product line and cater to an increasingly diverse consumer market.
With a third store in the works, Vergara’s success reflects the country’s voracious appetite for dairy—and the industry’s capacity to satisfy it. Despite waning milk consumption, Americans still consume a lot of cheese, yogurt, butter, and ice cream. Between 2021 and 2022, the average annual consumption of dairy products rose by more than 12 pounds per person, to an average of 667 pounds. And though the science is inconclusive around the health impacts, dairy products remain a staple in food assistance programs as a source of protein and other essential nutrients.