Due Diligence Tours Archives

All too often, transitioning veterans seeking to become entrepreneurs never take the first step in pursuing their dreams because of perceived insecurities. They prematurely assume failure by telling themselves they’re not qualified to compete in the business community. This couldn’t be further from the truth. The leadership, confidence, and problem-solving skills veterans bring to the corporate sector are precisely the type of intangible skills sets needed for success. As a veteran entrepreneur, I’d like to share my experiences by highlighting five fears facing many first-time veteran entrepreneurs and methods I’ve used to help combat these fears.

Lack of Business Experience

When I left the Marine Corps in July 2014, I knew I wanted to work for myself doing something I loved. Yet, as I began to put together a plan for AGD Consulting, a US-based agricultural investment advisory company, I couldn’t help but feel like I was woefully lacking in experience. What business experience could I bring to this type of venture, having spent the last seven years as a Marine Corps infantry officer? What I was failing to consider was the sum of all my life experiences, not just my Marine Corps service. Throughout college, travels in Latin America, and my time as an infantry officer, I developed sound leadership and management experience through years of exposure to uncertain and rapidly changing environments. My degree in Agricultural Engineering has served me well in managing our family’s agricultural investments in Latin America and the US. A previous investment in Ecuador and a current one in Argentina taught valuable business and investment management lessons.

Family Farm in Argentina

Last year, my family and I set off on a 6-month, 6-country investment research trip to Latin America to gain first-hand experience about local agricultural and financial markets in the region.

The Day We Left for Latin America

During that trip, I conducted over 100 unique agricultural site visits in six countries. The point here is to draw on all your experiences, not just your time in the service, to showcase your full range of talents.

No Business Contacts or Network

You might also be thinking, “I’ve heard networking is one of the most important parts of starting a new business, but I don’t have a single business related contact. Where do I begin?” Family is always a good first step. Start with your immediate family and extend out as far as you can. Social media platforms, phone calls, and personal visits serve as effective ways to reach distant relatives. Explain to them what you’re trying to do and ask if they know anybody in that field willing to help. Remember, you’re not asking for money or a great deal of their time; only contacts to build your own network. Next, reach back to your military contacts. Find a Bunker Labs group in your area as they can be a tremendous resource for linking veteran entrepreneurs to the business community. Contact American Corporate Partners and have them match you with you an experienced mentor in your field. Bottom line: don’t narrow your scope of support because you think you don’t know anybody who can help. It never hurts to ask.

I Have No Means of Financial Support While I Build My Business

This one requires some preparation. If you’re considering entrepreneurship after the military, start planning for it well before you leave the steady income it provides. My family and I started saving for an entrepreneurship venture in 2007. While in the Marine Corps, we tried to be responsible stewards of our money by living within our means, keeping a detailed budget, taking advantage of tax-free benefits offered deployments, and tucking away money every month. As a testament to what’s possible, our family of six left active duty service in September 2014, and aside from a few odd jobs, have not had a source of income since. As I write this article nearly two and a half years later, we still have enough in savings for two years of living expenses and capital to continue to grow our business. Anything is possible with a little preparation and a lot of passion.

How Much Time Do I Have? How Do I Manage it?

Start by creating a detailed budget. You need to be meticulous about keeping track of all money expenditures; everything from gas and groceries to larger expenses like house payments, medical costs, and business improvements. Build a reasonable miscellaneous fund into your budget to cover the unexpected. If you don’t use it all during a particular month, roll it over into the next month in order to extend your timeline a little further. Once you’ve determined your monthly expenses, take the amount of money you’ve set aside to launch your business and divide it by your monthly living expenses. This will give you an approximate timeline for how long you can build your business without seed money.

Managing your time is where the discipline you learned in the service is vital. At first, set a daily schedule that resembles the schedule you had in the service as a way to slowly transition into life as an entrepreneur. Each night, create a bulleted list of tasks you want to accomplish for the next day. Stay focused on those tasks throughout the day and don’t let the freedoms of your new work environment pull you off task. Work until your daily tasks are complete. If it’s a multi-day project, set aside a certain numbers of hours on that project per day and stop when you’ve reached that time limit. Work in time blocks that fit your daily schedule and biological clock. If your kids have an event at school, take advantage of your new found flexibility; just make up for lost time by working later at night or waking up earlier the next day. These are just a few examples of how a detailed budget, disciplined schedule, and strong work ethic can be the start of a successful transition into life as an entrepreneur.

What if I Fail?

Failure is never far from a new entrepreneur’s mind. Even with a solid base of business experience, a developed network of contacts, and sufficient funds, many more new businesses fail than succeed. However, veteran entrepreneurs have a distinct advantage when it comes to dealing with fear and uncertainty. Their leadership experience and disciplined nature give them an advantage when walking a path less traveled. Being an entrepreneur is about leaving the familiar behind and taking on the challenges that many do not. As a veteran entrepreneur, you are equipped with a set of skills that allow you to rationally weigh the risks, understand consequences, and develop solutions in short periods of time. As counterproductive as it might seem, part of that pragmatic solution should include a contingency plan. Once you’ve laid the mental and financial framework for Plan B, put it completely aside and focus 100% of your effort on the success of your business. Ruthlessly run down every lead, learn to embrace the uncertainty, and let your intuition tell you when it’s time to pivot.

In an age of market volatility, diversification is increasingly recommended. Investors bold enough to expand into international agriculture can find stores of untapped opportunities, strong upside potential, and an industry poised to profit from the coming rise in global population. As the Founder/CEO of AGD Consulting, a US-based, veteran-owned firm offering advisory services and due diligence trips for investors seeking experience in international agricultural investing, we believe overseas agriculture is an excellent way to achieve these goals. It’s imperative that investors walk the ground, experience the local financial and agricultural culture, and build trustworthy relationships with managers and communities before investing.

Below are the top five reasons investors need to walk the ground themselves.

A picture is not worth a thousand words

In my experience, online photos or reports can over or undersell an asset’s potential. Investment managers and syndicates tend to only present the best possible front for the project they’re promoting, therefore, it’s imperative for investors to see what they’re not showing you. Often times, these sites and experiences do not negatively impact the project, rather they add context and breadth for an investor to more fully understand what they are involved with. Find a company or expert to help you organize a research trip and perform your own due diligence before investing. As an example, AG DTours, a division of AGD Consulting, is providing customized expeditions to Colombia in partnership with Farmfolio as way to provide investors a richer understanding of their investment opportunity.

Meet the management

An experienced, well balanced management team who believe in what they’re doing is one of the most important indicators to investors on whether or not a project will succeed. If the project manager and his team don’t truly believe in the opportunity, it will be evident when you talk with them face-to-face. If you’re traveling to a country where you don’t speak the language, have your research trip provider arrange for interpreters to meet you at the project site. Talk to the local workers, ask what they think of the project, and watch how the investment manager interacts with his team. Listen and observe how the workers respond to your questions and watch how they perform their work; it will speak volumes as to how much they believe in what they’re doing.

Experience the geopolitical and economic climate

Potential investors need to experience the current geopolitical and economic climate of the country their investing in and/or what it could become during the investment’s lifetime. Talk with the locals about the current political administration, ask them what they think of foreign investors, and get a sense of how important agriculture is to their local economy. Talk to local street vendors selling agricultural products and ask them where they get their supply from, how business is going, and what would make their lives easier and more profitable. Learn how to convert money back and forth between currencies in order to get a sense for how easy or difficult it is. Go to a local bank and see if American citizens can open bank accounts. While you may never need to do this as an absentee agricultural investor, it will provide you with contextual and fundamental understanding of the geography and economic climate you’re investing in.

The right legal assistance

Understanding a country’s legal framework is crucial to protecting and insulating your investment as much as possible. This is where sound legal advice is an absolute must. If the investment opportunity you’re pursuing already has an embedded legal team with experience in the country you’re operating, great, if not, then you need to find one. The right representative can provide you with advice concerning titling issues, cultural differences, and connect you with governmental agencies to apply for special investor programs. Investors should seek counsel from someone with international investment experience as local advisors may tend to favor loyalty to their local network more than providing you the best advice that suits your needs.

Understand the culture

One of the most common misconceptions foreign investors have regarding international investments, especially in the agricultural sector, is the assumption the processes move at the same speed as the Western world. The Latin American way of life is generally slower-paced than many Americans are used to. Foreign investors need to experience this culture for themselves and determine if it suits their personality and investment needs. If you try to force your cultural expectations onto the local management team and the surrounding community, you will struggle. As an absentee investor, you are asking the community and team on the ground to watch over your investment while you are away. This is simply not possible without an understanding and appreciation for the local people and their culture.