Farm Business from the Perspective of Venture Investment
Agriculture historically started as small farming or family-based farming systems in many countries. In Japan, agricultural products go to the market through the JA (Japan Agricultural Cooperatives) distribution system that is not efficiently functionalized as a marketing mechanism. However, if we see agriculture as a general business from the perspective of venture capital investment, a farm business needs to be an efficient business system. Especially, it needs (1) profitability by way of technology or brand value through the creation of price competitive differentiation factor; and (2) scalability through business expansion. In addition to these two points, economic synergy effects through collaboration with neighbor businesses, such as (1) new energy business, (2) food processing business, (3) meat processing business, and (4) life science business are important. Farm businesses must develop a business system that satisfies economic rationality to justify investments. Regarding the human resources issue, farm business people tend to mix up the issue of developing the operation manager of the farm and plant, and developing strategic professional CEOs. To develop strategic professional CEOs as an important human resource in agriculture, it is vital that training takes place in areas such as management strategy, business model formation, marketing strategy, management accounting, system agriculture, technology strategy, sales strategy, brand strategy, and alliance strategy. Introducing CEOs from other industrial fields, such as ICT, retail, and life science are an efficient way to promote human resources.
KeywordsVenture investment CEO Human resource
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