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Interview with Onyeka Akumah, the CEO of FarmCrowdy

To start with, we are confronted with this issue of how technology is taking away jobs from people. How true is this?

Technology is an enabler. I studied software engineering and I have been involved in building technologies and software for companies. Before establishing FarmCrowdy, I have been using technologies to develop Wakanow, Jumia and Konga and also used technology in news.

As a web designer, I designed BusinessDay and Guardian newspapers’ websites. I also built a technology news platform that I sold to a newspaper house.   Technology in itself is tools for making things happen faster, allowing people to derive more value from whatever action they are trying to perform.

Rather than taking jobs, I think the only thing is that peoples have to embrace technology and understand how to use it to better for themselves. For example, you have a doctor that is trying to give a prescription, rather than just using what he sees on a patient or deciding on what he sees in his head, he can go online and crosscheck. That’s technology allowing him now to expand his knowledge beyond what he has.

However, in the near future, as we continue to do more robotics to share intelligence, yes you will see where one robot will do a job of 20 people. Now it is left for the 20 people to decide how they will use that robot to perform their task in the near future.In your particular field, with this kind of farming, how would it work?

I wanted to invest in agriculture and I was looking for a farmer to work with. In the process of doing my research I started asking questions; the farmers I spoke with said how difficult it was getting funding from banks, how difficult it was for them find the right market to sell what they produce and finding it difficult getting the technical knowledge they need to improve their yield.

Because when one farmer gets I ton per hectare, another farmer gets 5 tons for the same hectare and that farmer is making 5 times more, so improving their yield becomes a major concern.

On the other end, there are a lot of people like me that wanted to also invest in agriculture, but they don’t know the farmers to work with and if there is a disaster, their capital is protected. So in building FarmCrowdy, we then created a platform that will connect these farmers with the people that want to invest in them.

We do the work as it concerns sponsoring the farms, connecting the guy that wants to invest in agriculture. To the farmers’ end, we have built applications that allow us to manage the farmers, so that   the expert will then provide him knowledge he wants. We can now provide the farmers with input.

I am worried about the commercialization of agriculture and would you say that you are an enabler of that in terms of sustainability of the indigenous farmers?

Across the value chain of agriculture, there are different areas that one can play. We play in financial side and the market access side. There are other things we apply like the drones we use to apply fertilizers on the farm and mobile app to attract tractors to the farm locations. In that regards, we are the first platform in Nigeria to start getting everyday individuals interested in agriculture to invest in farming. If you say there is a commercialization of activities, yes, there is a bit of copycats that are looking at what we are trying to do.

To redirect the question, I am more worried about seeing food as a commercial thing rather than essential need because the more people are going into agriculture for profits, the more food (organic food) becomes expensive.

What is different from a rice farmer in Nigeria producing rice versus rice farmer in Indonesia is that the rice farmer in Indonesia may be producing 15 tons per hectare and a farmer in Nigeria is getting 3 tons per hectare using the same investment. So, when rice is coming from Indonesia, it has to be cheaper than the one produced here. I think it goes back to improving yield. If we improve yield, we will be able to get more value in the market that is organic and the price will drop.

How sustainable is the system in Nigeria with a peculiar situation in Nigeria where technology is not very functional at some points?

We have able to generate 7 million dollars to work with these farmers. Initially when we started, scaling our operations was a problem because we were dealing farmers direct, but now we deal with farmers in cooperatives and then we get major buyers.   In sustaining that model over time, there is element of application of technology of core work on the farm.

We are not only purely a technology driven business like the Google map, there is still that element of the farmer doing work in the farm and producing something we eat which is not technology. And there’s market to sell what you produce.

In sustaining the model, as far as there’s need to eat, there will always be need for FarmCrowdy to produce more. Nigerians probably consume 2 million birds per day and multiplied 700 million birds per year. We have a buyer that needs 15 to 20 million birds and we only gave him 400 thousand this year. Next year we are doing 2 million. If we do 2 million per year, that’s still one day consumption in Nigeria. It tells how big our market is.

You put more emphasis on livestock. What about crops?

We do both livestock and crops. Chicken has been the most attractive cycle we have. It has a shorter rearing cycle and we have done 13 cycles, but with crop we have done only 2 cycles per year. We did 500 hectares of maize, other years we have done 5 thousand hectares of maize planting. The crops actually allow you to use more farmers. We want to invest more and get more farmers.

Your operational base cuts across the entire country?

We are in ten states at the moment, Kaduna, Plateau, Edo, Akwa Ibom, Ogun, Oyo, Osun, Ondo and Lagos. We are not outside the country yet, reasons is that you have to try out your model first before scaling it. In all the things we have done in FarmCrowdy, we started small. We started with 500 chickens but now we have up to 1.4 million.

When we started we lost 60 percent of them. 300 of them because the market was from Ibadan we are to sell to a cooperative in Lagos. When the truck broke down on transit, some of the birds died. Imagine if we invested 100,000 chickens and this happened. With maize, we did 500 hectares of land and now we are doing 5000 and next year, we want to do 10000. That’s how we will keep scaling our operations.

There’s an opportunity to replicate our model. Ghanaians will sponsor Ghanaian farmers to produce Ghana foods. Kenyans will do same with their farmers and we have plans to do that in 2019. We have attention focused on Ghana, Mali and parts of East Africa. We will consider Tanzania, Rwanda and Uganda.

What really inspired the Agro business in the first place?

I didn’t want my children to ask me what I didn’t do concerning food security in the country.

There are three sectors I know I can use technology to have an impact, agriculture, real estate and transportation. I wasn’t into all the fancy areas. My vision is more about real problems that we will be able to apply technology to. I didn’t touch transportation because I was involved in Wakanow and I helped to launch the ‘Travelbetter’ site.

I felt agriculture is better because of that focus in 2015 on how do we diversify the economy as people were paying more attention to agriculture. FarmCrowdy went live September 14, 2016. We launched as a business on November 14, 2016, so we are barely 2 years old.

We are a team of 45 for now and we have empowered 8000 farmers. We have been able to get people excited about agriculture again. Our mobile app has gotten about 70,000 downloads. These are people that are following farms.

Even if they are not investing, they are getting updates on farms and maybe in the future they can make informed decisions about investing in agriculture. We have been able also to draw a lot of international interest to showcasing what Nigeria can do in terms of agriculture. In that regard, I think that’s something to talk about.

How do you get your funding?

When I wanted to start, I saved eight months’ salary from my previous workplace. I worked in British Council for 2 years, then to Delloitte and Wakanow and also joined Jumia to help launch Jumia and Konga, all under marketing and then built a platform I call ‘Quickgist’   which I later sold to a newspaper house in Nigeria. It was while I was in Travelbetter that the idea of FarmCrowdy came.

We started off in September and by January 2017 we landed our first investor that invested about $60,000 on our platform as a business. The first was Niche Capital and another major investors is Rasheed Olaoluwa, former MD of Bank of Industry, and then from there on we were selected on Textiles programmes and went through the programme to raise $1 million in 2017 and by February 2018, we got a grant from GSMA (an association of GSM providers); they invested about $325,000 in grant in us.

We raised $1 million from 6 US investors, I from UK, and 1 from Germany. Cocks Enterprise is a major conglomerate in US, Social Capital, Halex Capital and others. Then we have some Angels. In total, we had about 9 of them.

All these wouldn’t have come without challenges?

Challenges stemmed from inconsistency of one of the initial founders of FarmCrowdy. He left when we were barley 3 months old. He was supposed to focus on production. We felt the impact of his exit as a major challenge at FarmCrowdy.

Somehow, in our third month, someone had to step up that role and we had a woman do so. After that, we set out core values on who we recruit because we have to look for people with passion for the job, ready to start small and ready to grow.

Second major challenge was after the $60,000, we weren’t sure where the next money would come from. We are dealing with how to scale the business, hiring people and starting well. It was a bit of a challenge until we got into textiles and learnt some lessons.

Thirdly, was farmers not understanding the model you have at hand, I mean the local farmers may not read and write and finds it difficult to understand what we are saying. We started creating demonstration farms. A case in point was in Kwara State.

We could not get about 500 farmers to understand what we are saying but ended up selecting 20. We were able to show these 20 farmers what we do and how we do it. But after the demonstration farm, we got 2000 farmers in our next trial.

We are happy now that there is a lot policy that favouring agriculture in the country. The fertilizer policy initially favoured the local farmers alone. Also, there was this recent incident where Central Bank of Nigeria CBN said they are not going to issue forex to people to buy fertilizers outside the country, just to encourage local fertilizers.

For us in FarmCrowdy, we are already working with people like Notore who created their own fertilizers.

In the area of Corporate Social Responsibilities CSR, how does FarmCrowdy key into this in the country?

The entirety of FarmCrowdy is that we are doing good while doing well. FarmCrowdy is almost designed to look like CSR project for local farmers. You are putting more money in their pockets, they grow their income on average of 80 percent, providing them technical field training that the farmers   are not paying for, providing them with quality input the farmers don’t pay for and we go to places create boreholes for farmers to use as well.

Beyond all these, in the future, with our mobile Apps, the farmers will be able to get added value services like insurance packages that they would not have been able to access before us, financial services. Farmers come to us to give testimonies of how they benefited from FarmCrowdy.

How about the investors?

The sponsors are also excited about doing good while doing right. Initially, some sponsors were interested in their returns at the end of the season but with updates and pictures from farm, they get to see what they farmers are doing and it excites them.

The first cycle are mainly people driven by returns but with updates and physical observation of what the farmers are doing they change their mind noticing that other people benefit from their investment. This is how we get our investors come back to sponsor more than they did before.

You seem to be selective of agricultural produce you work with. What about other farm produce?

In designing our cycles, we make sure we have quicker sponsors; people want to invest in, say in six months, they get their money back.

Speaking also to vegetables, and others, we don’t touch them because there are risks involved. We can’t invest in things we don’t have the expertise to manage. We have done maize, rice and they are also crops with longer shelf life. The selection of crops is deliberate about what we do, making sure we have market to buy, short cycles and low risks. I want to be an expert at one thing and be known for it.

What are the expectations form FarmCrowdy in the near future?

We have worked with 8000 farmers already and would want to grow to 15,000 farmers more. We are currently focused in 10 states of Nigeria and planning to increase it to 15 states in 2019 and also take the model to other African countries.

This is the future I see and the long short is that if we can grow 50,000 farmers and contribute significantly to food security in the country with support of the government and goodwill received from sponsors, it will continue to amplify our efforts.

The good thing about FarmCrowdy is that with the Apps, you can learn agriculture and become a potential farmer without coming to FarmCrowdy.

FarmCrowdy is an indigenous multi-award winning agric-tech startup company that operates agricultural farming with modern technology.

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