Golden Valley 2.1: Agribusiness Startup

Every citizen receives an inheritance of €200,000 and has an annual cost of living of €7,200. Running out of cash means losing the game. To protect their standard of living and grow their wealth, they must decide:

• Invest (be a shareholder): buy shares in the startup. If the company is well run, the stake gains value. Money left in the bank earns a guaranteed 5% a year.
• Work as a specialised operator: negotiate a wage with the CEO (reference wage: €15,000/year). All operators of a company earn the same. Citizens who are not hired receive an uncertain unemployment benefit (€5,000 to €15,000/year).
• Run for CEO: the CEO manages the company, has no fixed wage and earns a bonus of 30% of gross profit (80% paid in the year, 20% deferred to the next year). The CEO may also invest.
• Roles add up: every citizen may work (as operator or CEO) and/or invest.

• Within the same year a citizen may only lower the wage asked, and the CEO may only raise the wage offered, so proposals converge. A new year starts with no such limit.
• The wage is AGREED as soon as the CEO offers an amount equal to or above the citizen's request.
• The stake accepted by the CEO is contracted and is the figure used in the accounts. If the citizen later proposes a different amount, the agreements table shows PENDING CHANGE until the CEO approves it.
• A citizen cannot unilaterally cancel a stake already accepted; CEO approval is required.
• Nor can the CEO change a contracted stake alone: the proposal shows AWAITING CITIZEN until the citizen accepts or declines it.

• Each hired worker (maximum 10 per company) requires €100,000 of funding.
• The CEO raises equity from citizens. If that is not enough, the company borrows from the bank at 5% interest a year. Bank debt may never exceed twice the equity.
• 80% of the money raised is invested in heavy machinery, which lasts 20 years and loses 5% of its value per year (depreciation). The remaining 20% stays in the bank for running costs.

• Each worker produces 150 tonnes of wheat per year.
• The CEO may pay €30,000 in cash for an innovation and technology programme spanning 2 years, raising output by 5% to 20% already in the first year.

• Seed, water, energy and fertiliser: €200 per tonne produced.

• Wheat is traded on the exchange. Prices range from €340 to €460 per tonne (reference: €400).
• The CEO records the quantity to sell and the minimum acceptable price. If the asking price is above the market, the wheat is not sold on the futures market.
• Unsold wheat may then be sold on the spot market at an uncertain price, or stay in the silo (inventory), valued at €300 per tonne in the accounts.

• The company pays 20% income tax (an advance payment of €10,000 has already been made).
• Bad debt risk: €25,000 is overdue from clients, with only a 10% to 40% chance of being collected.

• Individual winner: the citizen with the highest total wealth (cash plus the value of the shares).
• Best manager: the CEO with the highest return on shareholders' equity (ROE).
• Winning team: the group with the best income per capita, proving wealth was well distributed.

• Register in the game app.
• Ask the professor for the game (class) code.
• Talk to your group and decide whether you want to be CEO.
• If you are the CEO, create the company in the app, note its code and share it with investors and workers.
• If not, ask the CEO for the company code and start taking investment, savings and employment decisions.
• Prepare the final decision with provisional ones: save drafts and review the provisional reports produced by the app, which take everyone's temporary decisions into account.
• Submit the final decisions and analyse the results.