Following along from the 3 Common Misconceptions and the 2nd Common Misconception newsletter is the 3rd in the series…you guessed it! The 3rd Common Misconception.
Great question, and easily explained once you understand how our company and business model is structured.
#1 we maintain ownership of land in every single farm and #2 we participate in thebottom line alongside our investors on the back end.
If you see a long-term syndication or passive investment business model where the Principals are heavily rewarded with hefty fees on the front end and little or no carried interest, you would be right to wonder what will keep them interested and motivated long term to manage the project to the best of their ability.
Especially if/WHEN times get tough.
We want what you want…Long-term Cashflow from Coffee and Chocolate sales!
So, we structured the opportunities such that we share in the bottom line with a 20% carried interest in profits generated on all the parcels we sell.
This way we are just as motivated as you to produce the best product and generate the most profit, for as long as possible.
This is a critical requirement. As an investor, you always want to look for opportunities where your interests, and those of the Company (or developer, or management, etc.) are aligned with yours.
What does it mean for your “interests to be aligned”? When your interests and the Company’s interests are aligned, you and the Company share a common objective and goal. And the Company is incentivized to do what is in YOUR own best interests.
That’s the epitome of a win-win for an investor. And it means that we are shoulder-to-shoulder with you as to our interests, as opposed to being on opposite sides of the table.
As an aside, through our Socially Sustainable bonus pool program, our workers are also rewarded for their efforts with a performance related share in the profits. Now it´s win, win, win and we are all pulling in the same direction.
hat covers cash flow and long-term interest…but there is even more reason why we would not simply “walk away”.
We have a large amount of capital and time invested in building these companies.
As well as the coffee producing parcels that we maintain ownership of in each farm, we also own all the non-plantable land. All the land with roads, housing, infrastructure, rocks and forest which cannot be planted is not sold to investors and stays with us.
Quite a significant land bank when you add it all together over the 12 current farms.
Then, there is the state of the art, 1,800 m2 (19,375 sq.ft.), wet & dry coffee processing mill that we designed, built and paid for with our own capital. A several hundred-thousand-dollar investment in the best coffee processing equipment on the market, including a coffee testing and grading laboratory with high spec equipment.
Not something someone would put in place unless they had a long-term plan and certainly not something to walk away from lightly.
Especially after 5 years of hard work, sweat and tears to get all the permitting done and infrastructure in place.
So, hopefully you are starting to see the long-term commitment that we have made to investors, our team, our communities and our companies.
As we approach full production in the coming years all this hard work will begin to bear fruit for everyone involved and there really is no reason why it should ever stop.
Worst Case Scenario…IF we did all get hit by a bus..this is coffee country, you can hire a management team to take over with everything already in place.
Take-away: When you are doing your due diligence on an investment opportunity, make sure that your interests are aligned and congruent with the Principals own interests. You want to be sure you are moving in the same direction, and that they are incentivized to see the success of your investment. You want to make sure you are dealing with an Operator who has skin in the game, and a vested interest, as opposed to a marketing and sales team with no vested interest in the long-term success of your investment.
Heard enough?
Contact us to find out more and reserve your specialty coffee farm parcels Now!
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