Business Case · Capital & Equity

What this actually needs in capital — and how much of it is yours

This business case has quoted two different figures for equity at risk: ~148,000 SEK in the executive summary and ~322,000 SEK in the operating model. Both are arithmetically correct and they answer different questions, but only one of them belongs in front of a lender. This page reconciles them, states the number to use, and sets out the assumption underneath that nobody has tested.

The reconciliation, in one paragraph. The 148k is 25% of the Year-1 cash trough of about 593,000 SEK — the deepest point of the first year, when the herd is still ramping and land subsidies have already arrived. The 322k is 25% of the fully built net capital requirement of about 1,287,000 SEK — the whole herd plus all infrastructure, after a 40% investment grant. The first is a first-year cash-flow low point; the second is what the business needs when it is running at full scale.

Use the larger one. A lender funds the peak requirement of the built business, not the trough of a partial year — and quoting the smaller figure in a summary makes the plan look cheaper to start than it is. The executive summary has been corrected to point here.

The capital stack

Switch between leasing the land and buying it. Everything else is the same business — the same animals, the same customers, the same revenue.

Where the capital goes, and who funds it

Every krona the business needs before it runs at full scale, split by what it buys and by whether it comes from a lender, a grant or you.

Livestock — working capital

Infrastructure & machinery

Property

Grant

Your equity

The full requirement, line by line

The two figures, reconciled

Both appear in this business case. Here is what each measures and where it belongs.

The assumption underneath all of this, which has never been tested. Every equity figure in the leased model — 148k, 322k, any of them — assumes a lender will finance 75% of infrastructure and livestock on rented land. That is a very different proposition from the 75% you have been offered against a property, because there is no land as security. The collateral would be a shelter and a fence on somebody else's field, plus a herd of animals.

Banks do lend against livestock and machinery — your own bank said so explicitly. But the terms, the loan-to-value and whether a personal guarantee is required are all unknown, and they change the equity figure directly. If a lender would fund only half of it, the equity at risk in the leased model roughly doubles. This is now the first question on the bank call sheet.

Why livestock is the biggest single line

At 50 animals a year you carry about 63 at any moment, because each is owned for roughly fifteen months and cohorts overlap. Every one of them represents a calf you paid for plus the feed and care put into it since.

That is working capital, not a fixed asset. It recycles — each animal sold releases its own cost plus a margin — but the balance never falls to zero while the business runs, and it has to be funded from the very first purchase.

It is also the line most exposed to the calf price, which the risk page flags as both the largest single cost and the most likely to be understated in this plan.

What the grant does and does not cover

Investment support applies to assets, not animals. Fencing, water, buildings and equipment may qualify; the herd does not.
It is competitive, not automatic. The grants page treats approval as uncertain, and the lender proposal deliberately excludes it from debt-service cover.
Eligibility on leased land is unconfirmed, and may need the landlord's consent — a Blocking question that only Länsstyrelsen can answer.
It arrives after the spending, not before. Even when granted, you fund the asset first and claim afterwards, so the peak cash requirement ignores it.

Sources

Open questions

What this page could not settle, why each answer changes a decision, and where it has to come from. Blocking means do not commit capital until it is answered.

Question	Why it matters	Where the answer comes from
Will a bank lend against infrastructure and livestock on leased land, and at what loan-to-value?Blocking	It decides the equity at risk in the leased plan — the entire argument for leasing rests on that number being small. With no land as security the answer may be a lower ratio, a personal guarantee, or no.	The bank you are already speaking to. They offered to finance machinery and livestock; ask what changes when the land is rented rather than owned.
Would they require a personal guarantee, and over what?Blocking	A guarantee moves the risk from the company back to the household and makes the "equity at risk" figure meaningless — what is at risk is then everything you own.	The same conversation, in writing.
Is investment support available on leased land, and does it need the landlord's consent?Blocking	The 40% grant removes roughly 354,000 SEK from the capital requirement. If it is unavailable on rented land, equity rises by a quarter of that immediately and the whole capital stack changes.	Länsstyrelsen Stockholm, before applying, and the lease terms themselves.
How fast does the herd actually ramp in Year 1?Important	It is the difference between the 148k trough and the 322k full requirement. Buying half the herd in Year 1 halves the early funding need but delays the first full year of sales.	Your own decision, constrained by calf availability — ask the suckler herds what they can supply and when.
What working capital buffer would a lender require on top?Important	Banks commonly want liquidity beyond the modelled requirement. None of this plan's figures include such a buffer, so the real equity ask may be higher again.	The bank, as part of the indicative terms.

Prepared August 2026 as a planning aid. Figures are rebuilt from this business case's own operating and cash-flow models at their default settings, so they inherit every assumption in those models — including the calf price, which the risk page flags as likely understated, and the investment-grant rate, whose availability on leased land is unconfirmed. Transaction taxes on a property purchase (lagfart at 1.5% for individuals, 4.25% for legal entities, and 2% stamp duty on new mortgage deeds) are indicative rates that should be confirmed with the bank or an adviser. Not financial advice.