MBA603 - Investment Opportunities: Cosmo Coffee vs. Nexba Review

This presentation provides an analysis of two investment opportunities, Cosmo Coffee and Nexba Pty Limited, both seeking equity crowd funding. Cosmo Coffee, a roasting house/café, faces challenges despite a capable management and appealing products. Nexba, specializing in sugar-free beverages, demonstrates strong market demand and unique product offerings. The analysis evaluates management, market demand, production, competition, capital, target market, and success probability for both companies. Ultimately, the presentation concludes that Nexba presents the better investment opportunity due to its unique product, lower competition, growing market demand, and potential for economies of scale. The presentation recommends a thorough evaluation before investing and researching equity crowd funding to ensure value for money.

Assessing Investment
Opportunities
Name
Institution
Date

Introduction
Equity crowd funding and investment has
become an important aspect in business
today.
Many companies in Australia and all over the
world are using it as a major source of
funding for their businesses.
Equity crowd funding is a mechanism that
enables broad groups of investors to fund
startups and small businesses in return for
their equity .

Cont…
In this case, we shall examine two different
investment opportunities that are currently
on equity crowd funding platforms, and
thereafter determine the best investment
opportunity.
The two companies include
Cosmo Coffee company
Nexba Pty Limited

Cosmo Coffee
Cosmo coffee is a roasting house/ café that
specialized in roasting coffee on the site for
eat in, retails and takeaway.
The firm also offers fresh churros and sweet
treats (Cosmo Coffee, 2018).
For a while now, the firm has not been
performing well, hence the need for equity
crowd funding.

Evaluation of Cosmo Coffee
Management
 It is worth pointing out that the management is capable and
motivated to undertake the operations of the business and
attain high profitability (Cosmo Coffee, 2018).
Market demand
• So far, the market demand for Cosmo Coffee has
been as forecasted. Mainly, one can attribute this to
the fact that the company’s coffee is freshly onsite
roasted coffee that tantalizes the senses of the
clients.
• The coffee is also accompanied by various mouth-
watering beverages and foods (Cosmo Coffee, 2018).

Cont…
Production
• So far, the production in the company is low. As
such, the firm is operating below its potential
(Cosmo Coffee, 2018).
Competition
• Competition in the region is high. There are
various cafes that offer coffee beverages in the
area (Cosmo Coffee, 2018).
• However, the high quality of the company’s
coffee sets it above its competitors.

Cont..
Capital
At the moment, the company is in need of additional
capital to expand its operations in the market (Cosmo
Coffee, 2018).
Target market
So far, it has been noted that the existing customers and
the target market are able and willing to pay for the
coffee products at the set prices (Cosmo Coffee, 2018).
Success
The profitability of the company is still low. However, an
expansion of the companies operations through additional
capital from crowd funding can go a long way in
enhancing the success of the company.

Nexba Pty Limited
Nexba Pty Ltd is a company that specializes in
the production of naturally sugar free beverages.
The company was founded in 2010 (Nexba, 2018).
The beverage is unique due to its natural taste.
As such, it contains no sugar and artificial
ingredients in the production.
The company is seeking investors to subscribe for
shares and help accelerate the companies growth
plans in Australia as well as globally.

Evaluation of Nexba
Management
Overall, the management of Nexba is motivated and
highly capable of steering the company to the next level
of profitability.
Market Demand
The demand for the anti-sugar products in the local
market is high and, thus, has great potential for
expansion into the international market (Nexba, 2018).
Production
So far, the company’s production is significant. However,
the firm has not reached its production capacity and has
great potential for expansion through economies of scale.

Cont…
Competition
At the moment, the degree of competition is at bay.
Mainly, this is due to the fact that the commodity is
unique and not many companies offer sugar and
artificial ingredients free beverages (Nexba, 2018).
Capital
Currently, the company lacks sufficient capital for
expansion. However, it aims at raising more funds
through equity crowd funding which will help
enhance the operations of the company (Nexba,
2018).

Cont..
Target market
Currently, the company’s clients are able and willing
to pay for the products at the current price, ceteris
paribus (Nexba, 2018).
Mainly, this is because the prices of its products are
affordable and customers regard it as being value
for money.
Success probability
It is imperative to note that Nexba has great
potential for success. Specifically, it has a high
probability for achieving great profitability in the
near future

Analysis
It is imperative to point out that both
companies have great potential for growth
over the short term period.
Of the two companies, Nexba is the best
investment opportunity for an investor.
Predominantly, this is because the company
offers a unique product to the market and the
level of competition in this niche is
significantly low.

Cont…
The market demand for Nexba products is
continuously growing, thereby offering great
potential for the company’s profitability.
Additionally, the company has great potential
for achieving economies of scale in production
and therefore, enhance the degree of
operations and increase revenue (Nexba, 2018).
Most importantly, it has the greatest potential
and probability of success compared to Cosmo
Coffee.

Conclusion
It is imperative to note that both companies
have great potential for growth in the long
term as well as the short term period.
However, between the two firms, Nexba is
the best investment opportunity for an
investor.
Predominantly, this is because the company
offers a unique product to the market and the
level of competition in this niche is
significantly low.

Recommendations
Before investing in either of the companies, a
much thorough evaluation and analysis
should be undertaken.
The investor must research more about
equity crowd funding to ensure that they will
receive value for their money after investing
in Nexba.

Reference List
Cosmo Coffee. (2018). Cosmo Coffee [Online]
Available at:
https://www.cosmocoffee.com.au/about_us[Access
ed 10 June. 2018].
Cosmo Coffee [Online] Castle Towers Available at:
https://www.castletowers.com.au/eat/restaurants/
cosmo-coffee [Accessed 10 June. 2018].
Nexba Extension Round[Online] Venture Crowd.
Available at:
https://startups.venturecrowd.com.au/deal/detail/
nexba_2018 [Accessed 10 June. 2018].