Livestock Wealth Investment:
What is Livestock Wealth?
Livestock Wealth is a “crowd farming” platform that enables anyone to invest in cattle over a fixed term as they grow and earn income from the sale of the beef.
What if the company, Livestock Wealth goes out of business?
When investing in Livestock Wealth you invest in the actual ownership of the cow, hence each transaction having a tax invoice. Further, an investment the investor our iwinners in this instance receives an ownership certificate which together with your tax invoices verifies your ownership of the cow during your investment period. You the investor have a right over your asset regardless of Livestock Wealth. In that unlikely event, you will be able to either take the cow alive or convert the cows into cash and not lose your investment.
What are the cow options when investing with Livestock wealth?
You have the option of investing in a pregnant cow or a Free Range calf oxen (male calf) that has not reached full maturity. The costs of the two options vary. For this investment however, we will be investing in a Free range oxen (male calf) for 6 months.
What happens to my cow during the investment period?
Livestock Wealth through its partner farmer will then manage your free-range cow for 6 months until it reaches the appropriate weight (+/-500kg) which will enable for it to be slaughtered and sold.
How is my return calculated at the end of my investment term.
When the cow has reached maturity, it is are marketed to an approved meat abattoir who then pays a market related rate for the cow based on its weight. We than calculate your individual returns which will be your original investment plus a return of 4-7 %
Income from Sale of Cows – R18000* per grown cow
Cost of Replacing Calves – R8500
Gross Profit over 24 months = R9500
Annualised Profit (12 months) = R4750
The example given above shows that the annual income from the farm is R4750. Since each cow contributes R3780 in farming fees over 12 months, the net profit from the investment is R970. In percentage terms, that is a return on investment of 12.0%.
*(As with all financial products, this rate is a conservative estimate based on solid principles and tried and tested figures. The outcome can be influenced by variables that are out of our control and, while there is an allowance for such influences, severe factors may affect the rate of return, as with the risk in all types of farming)
What are the factors that could affect the percentage of returns I make per annum?
Factors that could affect the investor’s returns are the beef price and the weight of the cow.
What are the risks involved with livestock wealth?
Death and theft are the only significant risks associated with this type of investment, but all cows are insured against such unforeseen events with the exception of farmwide natural disasters beyond our control which rare occurrence.
What if my cow dies?
If during the period of investment the cow dies because of illness, accident or any other cause within our control we replace it at no cost to you. The only exception is if such death is caused by farm-wide natural disasters beyond our control. Such a risk would not only be affecting us but all the farmers in that area. This risk is reduced by having cows and farms in different areas to minimise the geographic risk of such unlikely occurrences.
What if I die before my investment reaches full maturity?
Similar to all your other investments your cow becomes part of your estate. Our app enables you to nominate a beneficiary In event of your death.
Will I be able to visit one of the farms to see my cow physically?
Yes, you will be, there will be a handover event at the of the campaign period where winners will officially receive their cow investment certificates along with some educational investment and financial skills especially on their winnings
Where are the Livestock Wealth farms situated?
The farms are situated in KwaZulu-Natal and North West regions with KwaZulu-Natal having 3 farms, namely the Rietfontein, Fairplay and Jesmond Farms. Farm and the North West has the Lusthof Farm.
Can I take the cow to my own farm?
Livestock Wealth only provides a solution for people who would like to farm but do not have the time, skills and land to farm profitably. There are various avenues such as auctions, livestock agents and farmer associations that are available for farmers who have property and abilities who want to buy cattle for their own farms. An investor has ambitions to become a full-time farmer in the future is welcome at Livestock Wealth but will have to take the invested amount plus their profit at the end of their investment term and use that to buy cows closer to where their farm is located.
What if I cannot visit my cow to check on its progress?
You can just download the Livestock Wealth app to view pictures of your cow and track its progress as it grows from anywhere in the world. To view pictures of your cow.
How will I be able to identify my cow?
Each cow has a unique RFID code attached to its ear tag that helps you identify it.This same code is the one that appears on your ownership certificate that you receive when you invest.
What happens when my cow falls sick? Who takes care of the veterinary costs?
Livestock Wealth and its partner farmers will tend to every cost pertaining to your cow as it is insured.
What will I receive as proof that my investment exists?
Livestock Wealth will provide the investor(s) with an ownership certificate with your cows own unique number.
Am I liable to pay tax from my earnings from the investment?
As with any investment investors are required to declare any income or losses from their investment which is then paid during tax season.
What happens if I relocate to another province during the investment period? Will I be able to transfer my cow to another farm?
It does not matter what farm your cow resides in, it is yours (Livestock Wealth to elaborate).
Is it possible to assign a beneficiary or hand over the investment to someone else?
The terms and conditions of the competition do not allow for that
No. When the farms are fully stocked they should be able to slaughter cows every month, meaning that the farm is able to share profits every year. In the first year of new farm establishment, when all the calves are still growing, there could be no cows to sell but over time this should stabilise.
The rate of increase in the price of beef has consistently exceeded inflation for the last 20 years. This trend is set to continue as more people enter the middle class and demand healthier protein. As Livestock Wealth, our target customer is the health conscious, high-end consumer market where healthy margins can be secured so as to provide a consistent return for investors and farmers who supply us with calves. We currently price our beef at a premium to grain-fed beef from the feedlots.
The rate of growth of the cows is the second biggest contributor to the profit of the farm. If the cows pick up weight quickly, they also get to market quicker and therefore increase the rate of return of the entire farm. The opposite is also true.
The cost of replacing calves is also a determinant of the profitability of the farm. We are creating strong partnerships with farmers to smooth the price volatility to ensure consistency in supply and pricing.
We have introduced the group-buying of one cow by up to four people (in true stokvel style) in order to reduce the barrier to entry for our investment. We strongly believe that owning a cow should not be a luxury that only a few can afford but a tool for ordinary people to build real, lasting wealth. When you buy a quarter of the cow, you only pay a quarter of its farming fees and also receive a quarter of the dividend from the cow.
You can sell at any time and we’ll re-list your cow for sale at a market-related price to another investor.
There are many benefits but here are the top 5:
1. It feels good to own cattle.
2.You are contributing to food security by investing in agriculture.
3. The cows eat grass and grow regardless of local and world politics.
4. You are creating jobs where they are needed the most.
5. You make a good return on your money whilst enjoying all of the above benefits.