A LOCAL fintech business, AgroStrong, says it has laid down strategies that prioritise protection of investment on those who are investing in cattle as it builds more confidence in the asset class.
The economy has over the years posed risks to new investments.
These risks include perceived country risk buoyed by the political landscape, the huge external debt, as well as currency instability.
Agrostrong chief executive officer, Bekithemba Nkomo, recently told NewsDay Business that his company’s strategies prioritises investment protection by minimising risks associated with investment in Zimbabwe.
“Generally, it is not practical to give guarantees for any investments made, but we have put in place measures that we believe will eliminate or minimise any risks to the investments. We have reputable production, technical and marketing partners who play different roles in the investment value chain. For example, on the production side, we have a strategic shareholding in MC Meats, and this allows us to tap into their expertise to deliver on the promises to investors,” Nkomo said.
“Additionally, there are independent trustees who are responsible for oversight on behalf of investors and produce their regular reports on the state of the investments. The cattle are also insured against most perils that contribute to mortality,” he added.
Nkomo added that investors’ funds were being pooled together and used to purchase cattle managed by AgroStrong and production partners and the business offers two investment options, namely the feedlot (pen fattening) and the breeders’ programme.
The feedlot programme is a short-term investment option where investment funds are pooled together to buy cattle (mainly steers) and placed under feedlots for pen fattening for periods of between 90 and 150 days.
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“The breeders’ programme is a medium-term investment option with a minimum period of three years and returns are driven by the number of calves produced. At the end of each year or calving cycle, investors have an option to get a dividend equivalent to the value of the calf or reinvest to ensure growth of their cattle herd. At the end of the investment cycle, an investor is able to either receive their capital redemption in cash or physical cattle,” he said.
Nkomo said AgroStrong has a minimum investment amount for the feedlot programme of US$10 and investors can expect a return on investment of between 12% to 16% per annum.
He added that the minimum investment period was six months, ideal for savings towards school fees, lobola, wedding savings, holiday expenses and other projects.
AgroStrong is a fintech business offering an opportunity for one to participate in its cattle-backed investments.
It has been in operation since 2021. It operates in Zimbabwe and has a sister company in South Africa, AgroStrong South Africa.
