IT and the sun: investment trends in Ukraine for 2018
The business climate in Ukraine is still far from being perfect. Still, that is no reason to abandon investment. Every entrepreneur knows that money must work. Especially knowing that our country offers a plenty of profitable industries to invest in.
It is worth clarifying here that the choice of an investment area depends on the amount you are willing to spend. Actually, it is even possible to make ₴1000 working in your favour. However, greater amounts are required when it comes to investment in a large business. So…
Starting $100 thousand
In this case, take a look at the retail business. Higher minimum salaries and pensions, increased as a result of last year’s reforms, can stimulate the purchasing power in the country and, thus, the profits for retailers will go up in 2018.
Also, it is reasonable to invest such amounts in IT startups and venture deals. In Ukraine, this segment is doing better than most others. Besides, the promising IT projects are quick to mature and obtaining profits can come faster as a result.
Starting $1 million
This amount is better to invest in agriculture. That being said, it is also reasonable to consider niche industries (e.g. cheese production facility or berries production companies) since they have a higher added value.
Another excellent alternative is investing in SMEs. Horeca is the simplest and most effective option.
Starting $20 million
Three years ago, the best source for investing large amounts in Ukraine was real estate. This year, however, it is persistently being displaced by solar power. Its market capitalisation in 2016 alone amounted to nearly $1.5 billion, and over 120.6 MW of solar power facilities were commissioned, which four times exceeds this very result of 2015.
The development this industry in Ukraine is largely a result of more favourable green tariffs as compared to many European countries, as well as the climate conditions. Our country has a lot of sunny days compared to Germany, which is considered one of the leaders in solar power plants.
Financial character of the issue aside…
If you are going to invest in something, do not underestimate the importance of a business plan. It can allow you to evaluate a project, its prospects, risks, payback period. In fact, the ultimate purpose of such business plan is to prove investors that his/her money will be returned with interests at a specific moment.
Not all investment projects require a comprehensive business plan. In some cases, when it comes to small deals and projects, it is enough to prepare an investment teaser that can describe the investment benefits on one page. However, in most cases, a business plan is a mandatory measure for entering a deal.
How does a good business plan look?
In brief, it is a document that can convey the information on high profits attainable in realistic timeframes in a compelling and intelligible manner. Moreover, the more details your business plan contains, the better. By “details” we imply both the profitability estimates in favourable conditions and information on its applicability in the event of crises. The further prospects of the project, its potential for future expansion, special market conditions it focuses on are all significant and should be elaborated in the document.
At the same time, the textual content must be intelligible. A glut of formulas, complex calculations, and vague wording are nobody’s friend. An investor can have an impression that the document was not thought over and that the vague wording was put there to hide it.
To obtain the most objective and informative business plan, be sure to delegate its preparation to independent experts. That is the most efficient way to minimise the risks and to invest in a project truly worth the funds.
This post is also available in: Russian