Does anyone have experience with agribusinesses in Search or acquisition?

June 05, 2022

by a searcher from The University of Michigan - Stephen M. Ross School of Business in Grand Rapids, MI, USA

I’m interested in shaping an industry thesis while in my MBA. As part of that, I’ve been pressure testing various industries as would be compatible with my lifestyle. I recently was sent an organic farm listing, and started thinking of larger farm operations through the lens of Search or ETA. Does anyone have experience with pivoting into farming or agriculture from a corporate or military background? What considerations for financing and sustainable cash flows are there?

Reply by an investor
from University of Miami in New York, NY, USA

Patrick, I spent a good amount of time looking at the broader food supply chain during my days in PE. I have to say that ag is tough. You have a lot of exogenous risk (weather, water, trade flows, foreign labor regulations, etc.) to ultimately produce a commodity product. This results in a suboptimal risk/return positioning for producers (e.i., they take on a lot of risk but don't get all the return, which is captured mostly by branded CPG and retailers). These factors make ag a less attractive industry for search or PE in general. Happy to chat in more detail, just shoot me a note at redacted

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