| Written April, 2007 |  |
File C5-230 |
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Assessing Agricultural Processing Investment Opportunities
Don Hofstrand, Co-Director, Ag Marketing Resource Center, Iowa State University Extension, 641-423-0844, dhof@iastate.edu
When considering an investment in a value-added agricultural processing business, focus your thoughts on the following six areas. These are some of the major topics to investigate when considering a business investment. This should improve your odds of making a wise investment decision.
A) Leadership - Are the project leaders capable of creating a successful business?
B) Economic/Business - Will the business be profitable?
C) Management - Is management capable of successfully operating the business?
D) Markets/Industry - Will people/companies buy the product?
E) Facility/Technology - Will the process work?
F) Financial - Are there sufficient funds in place for start-up and operation?
Each of these topics are investigated in more depth below. It provides you with a “checklist” of questions that are important in assessing each of the topics above. Answer each question yes (Y), no (N), maybe (M), don’t know (DK) or not applicable (NA).
This checklist can be used during or after an equity offering presentation to guide your investigation, to identifying important questions to ask the project leaders and as a guide to assess the Disclosure Document or Business Plan.
