This Agritech Bullshit, Or are we insane?
I sat down (Not entirely. I stood for the most part) across a panel of 4 investors, a couple of weeks back. My first attempt at pitching something endearing to some people’s misunderstanding.
The conference room was 2 men short by the time I was done, a rather perturbing affirmation that I had once again failed to explain the concept of my startup's thesis to an enlightened few.
I need to flesh this thing out, this startup thing, to explain my company's existence so often misinterpreted.
Still, somewhere in my mind's eye, I'm perhaps doing this to affirm my own sanity, silence my continued rhetoric "are we just chasing the wind?"
The idea for Farmoly did not entirely happen by chance. It was an evolution of accompanying ideas in the agricultural space. From the onset, Sam and I had always been enthusiasts of the industry. Having re'd agriculture at the university, Samuel was even more endeared to it.
We noticed problems. Quite a lot of people in the space had noticed too, but only a handful were actually trying to solve. The market was an admirable mess across most crops.
Farmers never really earned their work's worth.
A crazy amount of wastage occurred on a daily, especially around perishables.
An impressionable deficit in the availability of agro focused logistic providers across states.
Lack of real time data on pricing, farmers cultivating capacity, quantity of inputs etc.
A highly fragmented market causing a mismatch of demand and supplies.
Underutilized farmlands, making the expending of resources yeild low outputs.
Farmers disregard for quality standards ( Not on purpose, since most aren't even aware of modern and best practices), making most produce non-exportable.
A myriad of other unaccounted problems.
Was the billions of naira generated in transacted sales across the country, making stakeholders turn a blind eye towards developing effective solutions?
Was this an effect of a lack of considerable processing companies?
Samuel had built a real connection with a cross section of farmers in Nassarawa where he served. He felt the pain points more closely and turning a blind eye to the various complexities was completely out of the table.
The initial concept of Farmoly revolved around disseminating information about best practices to rural farmers. We were able to run a pilot with 50 yam farmers in Nassarawa. We had convened a seminar-styled gathering, recruited a local who spoke the native tongue and ran a one week series on seed yam production. We measured progess by testing the recollection of procedures by farmers.
There's however a fine, thin line between social enterprise and charity.
We built thesis around monetization models and how to scale leveraging technology, none of which seemed to make sense, at least at the time. Soon enough, the first version of Farmoly went with the wind, or more frankly, after Sam’s clarion call, came to an end.
Various iterations of what we wanted to solve with Farmoly came and (some, at least) went: Notably amongst them was a plan to train/build/deploy 10,000 greenhouse farms and farmers for Tomatoes in 10 years (Sam had even drawn out a full blown business plan around this), another was a crowdfunding investment arm for farmers (There are so much of this springing up these days)
Farmoly right now, and for the foreseeable future, is trying really hard to solve the distribution problem.
Consider these scenarios;
Farmer Okon just harvested 400 baskets of oranges on his hectare of land. He is able to sell a few at his village’s open market for very meagre sums . His extended family consumes only 10% while the rest stays on his farm at the mercy of the sun and ground insects. Left to waste and decay.
Mr Uche is a truck driver, he just moved 300,000 Naira worth of goods from Lagos to Benin. There are more jobs for him down in Lagos. He needs to return to Lagos. He finds, without luck, for goods to move back to Lagos. He returns back to Lagos with an empty truck, disappointed.
Mr Alabi sells pineapples in Lekki. Whenever he runs out of stock, he has to leave his house as early as 5am to catch a ride to Ketu, the popular food market in Lagos. He buys the pineapples for three times the price it was sold when it left the farm. He has to wait for a vehicle who charges him almost 10% the cost of the produce, to drive him and his purchased goods back to lekki where he eventually has to sell at a much more higher price to offset his expenses.
Mrs Njoku runs a smothie bar, and gets supplied pineapples by a local dealer who buys off from Ketu, resells at almost twice the price. The quality of her smoothies differs each week, because different varieties of pineapples were supplied at different times. Her smoothies cost more, because she needs to offset supply costs, and sometimes she doesn't make smoothies because her supplier who is dependent on Ketu, failed to supply produce, hence inconsistency.
At it's core, Farmoly is primarily being an aggregator. (Without diving into some Ben-Thomson-like analysis).
We Gather information (using sms, ussd in the works)from the supply end (farmers), onboard as much vendors and independent logistics personnel (using web, sms) as possible and route demand as at when due to the appropriate channels. A cycle of match making across the value chain and perhaps at some point, with enough network effects, would be able to control pricing in the entire market.
We don't think it is too much of a daunting task, trying to change (Notice my avoidance of the word: disrupt) the way food is distributed and sold. The problem however has been the users at both sides of the table. Agriculture has, for the most part, been a bottom of the pyramid play, an informal market driven by the not so educated.
How do you change a procedure with technology when the focus of the process is not savvy in itself. Enlightenment? Doesn't it defeat the mantra of: "Startups move fast?" is software in Agriculture only a facade? Do existing solutions that claim to use tech (read eCommerce) to enable farm to market trade see adoption by rural farmers and consumers alike?
The problems we face do not stop at uneducated end users. It goes down to infrastructure; logistics, payments and storage. It meant, building out our own logistics, payments for the informal market and owning our storage. These things are necessary for Farmoly to work at scale and software alone is far from solving them.
Sam's father thinks his son has gone mad for not finding some cool conglomerate to work in. My father? Story for another day. This entrepreneurship thing should work?
Perhaps we are mad afterall, descendants of the Mad King
(My apologies, I couldn’t avoid a Game of Thrones reference)
We could have picked some other sexy AI, machine learning and virtual reality space to disrupt, but no, the real crime was passion.
Sam is going out tomorrow, from our boy’s quarters which surprisingly doubles quite well as our office. Five more vendors want to buy from us and we will supply, with or without software, for margins sake.
Being mad had never killed anyone yet. Or has it?