Meet the Entrepreneur: Carl Jensen and Sunday Silungwe, Good Nature Agro
At FINCA Ventures, we look for entrepreneurs leveraging market-based solutions to create large-scale, lasting social impact. In this recurring series, “Meet the Entrepreneur,” we’ll be taking you into the minds of the intrepid leaders at our portfolio companies who boldly venture into markets in need of positive disruption.
If you are a smallholder farmer in sub-Saharan Africa, chances are you’re planting the same crops on the same land year-after-year, and unknowingly degrading your soil in the process. The seeds are probably uncertified, so yields are lower, and your crops are unsuitable for export. You are most likely growing staple foods, like maize, which sell for lower prices, and it can be tough to find a market for your goods. To top it off, you lack quality extension services, such as training, capacity building, financial management and agronomic advice. In this interview, we chatted with Carl Jensen and Sunday Silungwe, co-founders of Good Nature Agro, to understand how they’re meeting these challenges head-on with a comprehensive solution. Good Nature Agro is a social enterprise in Zambia that partners with smallholder farmers to improve their productivity through soil-enriching legume farming and links them to a high-value legume seed market to move farmers firmly into the middle class.
One of you is from Idaho and the other is from Zambia. How did you two meet and what is the origin story of Good Nature Agro?
Carl: I come from a long line of farmers in Idaho. After college, my father told me, “You can’t come back [to Idaho] until you make something of yourself and do your own thing.” That was unusual to hear from a farmer. So, after undergrad, I went to Cambodia, Nicaragua and the Philippines and realized how much I enjoyed small-scale farming. In 2013, I took this insight to graduate school at UC Davis where I studied international agriculture development. While there, I held a position with MIT D-Lab, which applies human-centered design to development. I was involved in a design summit in Lusaka, Zambia that brought in people from 30-plus countries and a myriad of backgrounds, so the people we were designing for, we were designing with. As fate would have it, Sunday and I were roommates during the summit. Between my farming background and Sunday’s upbringing in Zambia, plus his thesis on gender and labor in agriculture, we struck up conversations about the gaps we were seeing in the market — smallholder farmer productivity was low, and smallholders could never get enough savings going or get financed. The summit wrapped up and I returned to UC Davis and enrolled in business school with these conversations in mind. Meanwhile, Sunday was back in eastern Zambia talking to stakeholders and vetting opportunities. We only had a shell of an idea at this point and we were pulling from other active players in government, nonprofit and private sectors trying to find our niche. While in business school, I pitched the framework of what is now Good Nature Agro as an idea for a project. In my class was Kellan Hays (the third co-founder of Good Nature Agro) and I told the professor I wanted her on my team. Turns out she didn’t want to be on my team at all. But with some coaxing, she gave it a shot. We ended up pitching the idea at a business plan competition at the end of the year and got our first grant funding from UC Davis. This was quickly followed by entry into a fellowship program from MIT. That’s where a fair amount of our seed funding came from. In 2014, I moved to Zambia and that’s when Good Nature Agro began, albeit under its original name of Zasaka.
Many organizations are working to improve outcomes for smallholders in sub-Saharan Africa. How is Good Nature Agro tackling challenges in Africa’s agricultural value chain in a way that is new, better or different than other actors in the sector?
Sunday: When we got started, it was uncommon for a seed company to work directly with small-scale farmers — this was something new. Also, we offer wider variety of legume seed crops and a more personalized service level to our growers than other organizations.
Carl: We are engaging smallholders not just as producers but also as customers. We bring in the whole value chain and make sure smallholder farmers are confident in where they can sell. Once they have that confidence, they are willing to invest in new, better inputs rather that recycle the same legume seed they have had for 30 years. It’s no wonder that farms are not diversifying when people won’t invest in better technology. So, Good Nature Agro gives smallholders an incentive to invest in better technology: improved seed varieties that are more disease resistant, export ready, and have higher yields. As far as we know, no one else is doing this.
Good Nature Agro has been around for about five years. Imagine it’s another five years from now and your company has made international headlines. What would the headline be?
Carl: “Good Nature Agro has pioneered a model to move 100,000 small-scale farmers into the middle class.” Seventy-eight percent of the rural population lives on $1.25 per day. We don’t want people to go from extreme poverty to poverty. The goal is to give people choice and to let them chase their middle-class goals. We went through an exercise where we asked all our growers what they want to accomplish in one year, three years and five years. When we look at their five-year goals, they talk about building a new house, getting a car, sending kids to college — real middle-class goals. So, we looked for the intersection of what’s possible in the field, what’s possible with the unit economics that our crops provide, and what our farmers want to accomplish. All of this pointed to a goal of helping our growers earn $600 in net income per hectare of land. The average farm size is 3.3 hectares, so it equates to $2,000 of net income per household, which is middle-class in Zambia.
What are some of the barriers Good Nature Agro faces in achieving this vision?
Sunday: It takes time for people to buy into a new concept. So, in our case, getting smallholders to think about saving money and planning for the future as opposed to living hand-to-mouth.
Carl: To build on Sunday’s point, it takes multiple years to earn trust. Because of this, we plan for gradual growth. Similar to how we first began, we seed new areas with a small number of growers and work very closely with them. Experience has shown that we cannot expand well if we don’t begin by building trust.
Entrepreneurs tell us that one of the biggest challenges they face is attracting and retaining top-tier talent. What do you look for in new recruits?
Sunday: We look for three things. First, we look at competency. Does this person have the right skills to fill a gap in our team? Second, we assess cultural fit. Would this person thrive in a close-knit, family-like environment that is grounded in teamwork? Third, we consider mission orientation. Does this person have ambition to achieve goals, over-deliver and work beyond the JD?
Carl: Over the last two years, we have consciously looked to bring in a diversity of thinking and experiences. This includes people who come from the private sector, others with a clear impact focus, and those accustomed to working in competitive, return-seeking environments.
Good Nature Agro’s extension model is built on a ratio of one Private Extension Agent (PEA) for every 40 farmers. Why is this important and how has it contributed to your success thus far?
Sunday: Before we got things off the ground, we looked at the government model. In some places, there were as many as 5,000 farmers per extension officer. If you visit the field or come from the area as I do, you know that farmers are not in one place — they are spread all over. So, it becomes clear that one extension officer for 5,000 farmers just doesn’t work. Our ratio of 1:40 stems from the first group of farmers that we had, which was 40, and that has worked well for us. We form farmers into teams of 10 to make it easier for communication, goal setting and teamwork.
Carl: We knew what we wanted to do with our farmers and teams, which was to deliver trainings to groups and to visit each farmer at their home or field once every three weeks. So, we looked for the number that made this possible and kept it personal to build relationships and earn trust.
How does Good Nature Agro approach the question of gender in its recruitment and team formation?
Carl: We have always tried to maintain a 50/50 male-to-female split among growers and PEAs. Now, we are enrolling households instead of individuals. Over the past four years, we have come to see that things are shared within a household. Farm labor is shared. Farm learnings are shared. We want to lean into that. It’s the household we want to move forward, and we see no reason to separate the people within it.
Why were you excited to have FINCA Ventures come on-board as an investor?
Sunday: FINCA Ventures and Good Nature Agro are like-minded: both are focused on alleviating poverty. Having that synergy with an investor supplies the confidence of knowing we are working toward one goal. Also, FINCA has a model accustomed to working on-the-ground with rural populations in countries around the world. We see this as an asset in our long-term planning.
Carl: We realized that we cannot do everything ourselves, which was our original instinct. Now, we focus a lot more on who we partner with and to make sure it’s the right fit. The reason I was initially excited about FINCA Ventures is because of the people on the team. FINCA Ventures pushed us to think about how to build value in our business while maintaining a strong impact focus. Beyond that, we like that the FINCA network is well-aligned with agriculture, and we have seen firsthand how the FINCA name adds credibility. The work we are doing right now with FINCA Zambia is a great example of this. We’re piloting cashless payments to PEAs which will be deposited into their new FINCA savings accounts. PEAs can access their accounts from their cell phones via mobile money. This reduces operational risk by reducing the amount of cash we have on hand and carry into the field. But cashless payments to PEAs is just to test the system; the goal is to pay our farmers this way. Most likely we’ll do a combination of digital and cash payments to build trust since our farmers live in a cash-based economy. We think this will set a good foundation for more savings and less hand-to-mouth living, made possible by our partnership with FINCA.