When Andrew Sisto set up Alpine Point Capital, he knew he wanted to tailor his loans to small and medium enterprises (SMEs), reaching those without access to conventional financing options. His background in transportation and logistics provided the experience and skills needed to launch a trade finance fund that provides working capital loans to agricultural exporters.
Sisto works alongside Adam Compain, General Manager at Alpine Point. The two worked together for years before launching the fund, and, according to Sisto, it was a natural fit because they are both “logistics junkies,” and they wanted to put their skills to something both meaningful and profitable.
Filling the Funding Gap in Emerging Markets
Sisto founded a global shipping tech company and worked as VP of Growth at project44, a multi-billion-dollar logistics technology company. Compain was the Founder and CEO of ClearMetal, where he led the company to become a global leader in inventory-level ocean visibility, serving clients like Amazon, Unilever, and Exxon. In 2021, ClearMetal was successfully acquired by project44, and Compain served as project44's SVP and Head of Global Product Marketing for two years, where he got to know Sisto.
The two quickly saw a gap in the market, realizing that companies exporting goods from one place to another required lots of funding to ensure things ran smoothly in the background. However, there didn’t appear to be much interest in offering alternative types of funding for these activities, and the two quickly saw that the space was still dominated by large banks looking for low-risk investments, for which many SMEs were not eligible.
After carefully assessing different regions, Sisto and Compain decided that South America was the right place for them due to its strong reputation as a global food powerhouse and major exporter of agricultural products.
Empowering Small-Scale Farmers
Many small-hold farmers across the region own just a few hectares of land and live on less than $5 per day. Meanwhile, the existing trade system means these farmers must often wait 35 to 45 days to get paid for their crops while they are packaged and transported to the importer. This gives them little opportunity to invest in seeds to grow and sell more crops.
Sisto and Compain see the market differently from traditional banks, which often ask for assets and collateral from farmers to back their loans. Many of these farmers do not have collateral and cannot access conventional financing. In contrast, Alpine views the cargo as collateral, and if there’s any issue with collecting money from the importer, they can take the cargo and sell it to recoup their funds. As there is a stable global market for agricultural products and a global market price for produce, the risk is hugely reduced.
A Strategic and Scalable Investment Model
The fast turnover of agricultural products means that their loans are typically returned within one to two months, meaning they can keep reinvesting in the market with little risk of price volatility. Sisto and Compain prioritize ensuring all parties involved are aligned and that investors regularly share in the return rather than focusing on ever-expanding growth.
Sisto and Compain only work in stable agricultural export markets, including Peru, Paraguay, and Uruguay. They see a demand of over $150 million in this region, meaning they have no difficulty finding borrowers. All loans are paid in U.S. dollars, so there is no risk of currency exchange volatility. In addition, Sisto told Ashton Global, “Loans are over-collateralized. They are spread across lots of parties.” This helps reduce the risk because “it’s a volume game”, and even if they make a loss on one loan, it won’t affect the company's overall financial stability, Sisto explained.
ESG is at the center of Alpine’s loan model. Sisto and Compain created the fund to turn a profit and support local individuals and SMEs. The two consistently set ambitious objectives to ensure they deliver their ESG promises. For example, they agreed that the fund must deliver at least $2 million to SMEs in Paraguay to support farmers and communities across the country.
Building Long-Term Partnership to Generate Alpha
Achieving these goals depends heavily on building strong connections with local partners. Sisto and Compain focus heavily on aligning commercial incentives with their associates. They seek out partners with links to SMEs working in agriculture and interested in purchasing products from local communities. Their relationships are “very transparent from the get-go and focused on managing expectations at all levels,” Sisto told Ashton Global. They also like to be an investor in the partner’s underlying management company to further align incentives.
Sisto highlighted one of Alpine's success stories regarding its lending approach. The fund provided trade finance loans to support cargo shipments to Haiti for relief efforts. Sisto told us, “It not only helped local communities of farmer exporters, but it also helped those at the endpoint facing political challenges in Haiti.”
Sisto also emphasized the community impact of the lending model. He explained that Alpine had provided loans to several farmers working as a cooperative to send chia seeds to Japan. “It was encouraging to see communities collaborate to create a business plan and achieve this outcome,” Sisto told Ashton Global. He hopes that raising more funds will help Alpine to support more individuals and communities in the future.
A Vision for Sustainable Lending
Sisto hopes to expand the business by using a scientific approach to choosing suitable locations in South America to deliver funds to more SMEs. He also plans to grow the company to reach other parts of the world, such as West Africa. Ashton Global is inspired by Alpine Point Capital’s commitment to an alternative funding and support model for SMEs across South America.
