‘Invest’, has always been a mantra. Maybe more pronounced in recent times, due to the coronavirus pandemic and the unexpected effects it brought.
While we are constantly exposed to adverts in the media, inviting us to invest in various sectors, with promises of juicy returns, it is most likely that some of us would tend towards agric-based investments.
This is likely, because a lot of people feel that, regardless of the times we are faced with, humans will definitely eat.
This thought brings some sort of certainty that return on investment, will come through, as well as the invested capital.
However, since anybody can come up and ‘start’ an agritech company with acclaimed legitimacy and assurance, investors have to be super careful.
First, agritech is the use of technology in agriculture with the aim of improving sustainability, efficiency and profitability.
An agritech company is one that uses technology in agriculture, to power online, the various layers of services they offer.
An agritech investment is simple. Investors sponsor the farms and in turn, get guaranteed returns, without having to bother about the technicalities involved. Return on investment, (ROI), could be as high as 35% on investment.
This idea of a large number of people, bringing money together for a project, or venture is what is, also, known as crowdfunding.
With over 50 agritech companies in Nigeria, however, how certain can one be, about investments?
This is considering the length to which dubious folks can go to enrich themselves, at the expense of other people.
Beyond hearing from friends, or from a couple of people on social media platforms, you should carry out your research about the prospective investment company.
While researching does not guarantee that investments will fall through, here are a couple of things you can look out for, before investing in agritech companies:
The Company Structure
Look out for, whether the company is registered with the necessary institutions. This denotes legitimacy and could indicate that the company would take agreements seriously and will be responsive to investors.
What do people have to say, about investing with the company? Are there reviews you can lay your hands on?
Who are the key figures in the company? Do they have qualifications, to assure you of their possible competence in the field you intend to invest in?
Do they have a social following? Are there previous controversies surrounding the company?
These are a few of the questions one should ask before investing and a simple google search could get you started.
The benefits of insurance for businesses are numerous, but beyond the benefits, a business stands to gain, investors have their benefits as well.
One should ask if the potential agritech company is insured and if the said insurance company is reputable, just in case, anything goes wrong with the agritech company.
While it is true that every investment comes with its own risks and downside, it never hurts to invest with institutions that offer certainty and peace of mind.
Although returns may not be as ‘high,’ as one would get from agritech investments, this would prevent loss and heartache.
For instance, returns on fixed deposit accounts with banks, may not bring as much, but one can be certain of both ROI and invested capital.
There is, also, the option of starting a business, as a form of investment, but business takes time and consistency to build and the rewards may not come in immediately.
Should one, decide to invest with agritech companies, it could, also, be wise to diversify, by investing in other fields.
The proverbial, ‘not putting all your eggs in one basket’, comes to play. Here, you spread your investments, among different options.
This would help prevent the overall loss of investment.
Featured Image: digestafrica
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