Back in April, I wrote an article for our newsletter discussing a better way to do economic development in Virginia. The example then was lieutenant governor candidate Pete Snyder writing to the CEOs of Magpul and Beretta and asking them to relocate their operations to Virginia. But with a twist: he offered to put his own venture capital money on the line as an incentive.
Those offers are still pending, but a deal Snyder made Tuesday shows that venture capital can make a difference for Virginia manufacturers:
At a Tuesday afternoon press conference in Lebanon, Va., Disruptor Capital CEO Pete Snyder and Bills Khakis CEO Bill Thomas announced a major investment by Virginia-based Disruptor Capital in Bills Khakis, a made-in-America, manufactured-in Virginia apparel brand.
The investment will help support 160 jobs in Russell County, Va., where LACorp—a family-owned cut-and-sew operation—manufactures approximately 120,000 pairs of Bills Khakis pants per year.
“Bills is a classic American brand and a true entrepreneurial success story. At a time when many manufacturing jobs flocked to Southeast Asia, Bills bet on the talented and hardworking people of Southwest Virginia—and the quality shows,” said Disruptor CEO Pete Snyder, who also joined the Bills Khakis Board of Directors. “We’re excited to make this investment in a great American business and good Virginia manufacturing jobs.”
“We are thrilled to have an entrepreneur of Pete Snyder’s caliber join our Board,” Bills Khakis CEO Bill Thomas added. “Pete’s strategic investment in Bills will help us take our brand to the next level, and will help secure existing jobs and create new jobs right here in Virginia.”
This is not a flashy, high-tech investment one might think Snyder would be drawn to. That does not mean it isn’t without risk. Domestic textile manufacturing is not exactly a beacon for capital.
But it does show what I was getting at in that earlier article: private capital making investments and taking risks over governments using taxpayer dollars to do the same. It goes against the grain of economic development in this state. But it should become the Virginia way.
And yes…there is a political angle to this. When I talked to Snyder about the deal, he said he didn’t do it for politics, but because he believes in the company. And like every good investor, he wants his money to make money. Someone making such a move purely for political reasons — and this late in the nominating game — would be worse than a fool.
And of course…it will be compared to Terry McAuliffe’s adventures in capitalism. He sought the best government deal he could get for locating his electric car company. He promised to develop Franklin Pellets, but it has yet to go anywhere. Some of this was classic rent seeking. The jury is still out on the pellets.
But should Snyder survive the scrum this weekend and be the GOP lieutenant governor nominee, he will have a real example of putting his own money on the line to sustain a Virginia business and Virginia jobs. A nice thing to have in a general election fight.