Access to credit and market linkages for smallholder farmers are a known problem in most developing nations. Ayon Hazra, the founder of Qlikchain observed the unorganized sector due to his father’s association to farming networks and street vendors as a social reforms activist and this is his story.
The agricultural and hawker economies are responsible for the sustenance of 75% of Indians and the highest employment generators in India.
With his previous experience in distributed & democratic ecosystems, Ayon Hazra saw blockchain playing a key role in bridging this trust deficit and creating fair economies. In this model farmers can establish longer term, direct relationships with buyers who could receive a share of harvest or % of sale proceeds. These short supply chains provide fair wealth distribution, reduces food miles, raise trust, quality, and enhance biodiversity.
Ayon Hazra’s entrepreneurial journey began as a consultant, providing solutions to fortune 100 customers across the globe for multiple MNCs.
“After working in the business consulting industry for over a decade, I decided to build a social enterprise that could create market linkages to farming networks and ensure fair wealth distribution across the food chain.”
As of 2018, 500 million smallholder farmers have provided sustenance to 2.5 billion people. However, smallholder farmers have weak relationships with buyers and supply chains. The problem is multi-fold — farmers need to be able to sell harvest to secure formal credit which can only be obtained if they are recognized by the local governments. Smallholder farmers are unable to provide guarantees that traditional investors seek. Coupled that with captive customers and opaque value chains have made it impossible to gain access to investors and markets. Short supply chains between farmers and consumers would enable fair wealth distribution across the food chain, conserve biodiversity, reduce food miles ensuring quality and low carbon footprint which would lead to strengthening the local economy.
Problem Statement — Access to Market & opaque value chains
- 77% of India relies on the hawker distribution channel as the point of purchase. However, customers have zero visibility of the food chain — quality of food, trust deficit and food safety issues
- Hawkers do not have access to collective bargaining and hence buy at a higher price individually from wholesalers where the quality too is compromised.
- Fragmented supply chain with a trust deficit due to information asymmetry within the food value chain
- As farming cooperatives do not have access to captive markets/contracts they:
- do not have reliable incomes and due to inability to forecast demand
- end up with unfair farm gate prices due to distress selling
- Post-harvest losses in India exceed Rs 90,000 crore per year, due to lack of access to supply chain services like storage and transportation
Qlikchains Blockchain-based platform, Borlaug Web Services (BWS), has been developed ground-up, keeping in mind the challenges specifically with the Agri-sector in mind. The platform has 4 components to provide seamless transparency & traceability for all stakeholders:
· BWS platform offers decentralized identities (DIDs) backed by Borlaug blockchain for citizens in unorganized communities.
· BWS Audits helps farmers provide compliance reports and sustainability assessments to buyers offering transparency and traceability in value chains.
· BWS Provenance Tracking is used to record and track origins of commodities with live reports of signed proofs on the blockchain with detailed tracking and tracing information.
· BWS Marketplaces helps agri-producers gain access to markets and secure capital from consumers in return for a share of harvest or revenue
In addition to this, in India, their partnership with the National Hawker Federation (NHF), the largest organization of street vendors in India with more than 2 million members, provide them with one of the biggest sellers’ network.
This, connected with their partnerships with several farming networks provide them with an unique edge to connect two of the largest unorganized sector in India.
“From our vision perspective, we are still aligned to our initial goal of empowering local farming communities. So, in that sense, I would consider myself fortunate to pursue the goals for these 3 years and still look forward with optimism that we are closer to our goal than where we were yesterday. It is that drive to pursue that vision that takes our organization forward. However, as an entrepreneur, in hindsight, there are always room for improvements. One of the key advices I would give to myself is focus more on local knowledge. All geographies are unique with respect to the product placement, value chain and solution offerings. Hence, identify the geographies that you would like to focus and centre the product development for those markets, instead of a global focus.”
When asked What has been your greatest achievement so far? Ayon answered; “to be able to provide better pricing to farmers via direct sourcing to consumers. It is a matter of pride to see smiles of their faces when a farmer realizes that they have earned a higher profit for their effort after partnering with us.”
“We were looking to gain experience in decentralized agro economies and in countries where the Agri sector is a large contributor to the country’s GDP. Netherlands was the obvious choice. We found WorldStartup aligned to our vision of impact and sustainability.”
Qlikchain wanted to build a for profit social enterprise that would have a positive impact to smallholder farming communities especially in the developing nations. WorldStartup helps with messaging and helped shape the DNA of the company since inception.
When asked how the COVID-19 pandemic affected Ayon Hazra as a founder and his business, Ayon answered: The ongoing pandemic has devastated the livelihood and income generation for the millions of people associated with the unorganized sector. We believe that access to basic amenities like food & sanitation is imperative at these times where the situation has rendered them helpless. However, as they say, every cloud has a silver lining. Post COVID, we are seeing an increased awareness amongst consumers to “know your food source”. Hence, Customers are buying more natural produce and farm fresh foods. We had been trying to create an awareness among farmers to emphasise more on natural (or Organic) farming. Earlier, due to low demand, the production of such food items was pretty low. In recent times, the farmers are getting increased demand for natural products. This has helped our cause in trying to provide natural food to consumers along with fair pricing for farmers.
Some of their key initiatives for the next few months include:
- Expand our operations across 6 states in India
- Onboard 100 farming networks and 50 street vending hubs across India
- Start our B2C offerings of grocery staples, fruits & vegetables across 2 major cities
Their key milestone would be to break even in terms revenue generation from our operations by 2020.
As we concluded the interview he left future entrepreneurs with the following advice;
“Stay focussed. Setbacks and disappointments are part of the journey to success and not an aberration. “ and “Focus on product quality — Irrespective of the funding that you get, and all sales & marketing effort, it’s the Customers who will decide whether you are successful. For that, you need a great product — So, ensure that when the opportunity does knock on your door, you have the right product to make it to the big stage.”