Ayo Arikawe is the co-founder and chief technology officer of ThriveAgric. In this interview with Josephine Okojie, he spoke about the agritech industry and major challenges in the agricultural sector limiting productivity.
Why must investors choose your platform instead of others?
We established ThriveAgric with the vision to build an Africa that feeds itself and the world, and we are doing this by building the largest network of profitable farmers across Africa to promote food security.
We understand that while smallholder farmers contribute to over 80 percent of the food consumed in the continent, they significantly face the problems of access to finance, advisory on best practices as well as premium market access for their commodities and we have set out to build solutions that cater for this, leveraging technology to unlock sustainable livelihood for them in the various rural communities.
Over the years, we’ve demonstrated a strong operational presence across various touch points with a firm understanding of the agricultural space and this has enabled us to build market-fit solutions that cater to the needs of these smallholder farmers.
Lots of agritech platforms defrauded investors, what did you do differently to pay investors and remain in business?
Just like several other businesses, the pandemic greatly hampered our operations due to the restrictions placed on movement making it impossible for our farmers to access their farms. This, however, led to the inability to pay back our subscribers within the period.
However, to mitigate this challenge, we strengthened our communication process and the entire team, brought in our head of risk and our chief finance officer, who also has good experience in agrifinance. With this, we were able to position the business in a way to attract a more institution-based financing model which is most suited for the sector with lots of debt funding required to sustain its operations.
We also developed the Agriculture Operation System, our flagship technology which has enabled us to create the right visibility and transparency for our operations. This level of sound decision-making by our management team, transparency and visibility was a game changer for us, and by 2021 we had settled all obligations thanks to our subscribers and since then have been scaling our operations beyond Nigeria into other African markets.
Farmers default on loan repayment most times. What is your experience like with the farmers you are working with?
Farmers default on loan repayment occurs in our sector. However, for us at ThriveAgric, we know that smallholder farmers are key to unlocking the continent’s unrivalled food production potentials, and so we ensure to create an enabling environment for them to thrive by leveraging our platform.
We constantly unlock opportunities for our farmers through technology to provide them with the right seeds, fertilizers for great yield, data-driven advisory on best practices for their end-to-end farming activities and also connect them to offtakers within the ecosystem who offer premium prices for their commodities – taking away the complexities with middlemen to improve earnings for better livelihoods.
Our aim as a key player in this sector is to build the largest network of profitable African farmers for the sustainability of our food systems across the continent.
Of the challenges that beset agribusiness, which poses the greatest threat to your operations and how are you dealing with it?
The agriculture sector holds a promising prospect on the African continent. Players are only just scratching the surface of the potentials that lie in here. The sector contributes to over 70 percent of the employment opportunities available to the Nigerian population; this means that there’s a huge potential for sustainability of our food systems and leverage to ensure the stability of our economy.
However, financing is still a critical challenge faced by players in this sector, and specifically finding the right financing structure that’s best suited for the agriculture space is even more of a challenge. Over the last six years, we have put a lot of effort into solving this problem.
We have been able to provide digital financial identity to our farmers which help us build credibility for the farmers. Without this, it would be difficult to access funds from any financial institution.
We are also working with commercial banks and leveraging strategic partnerships with input providers to help provide the services these farmers need. The result of these strategies continues to help ThriveAgric bridge the financing gap for smallholder farmers across the continent.
How can the country make agriculture attractive to youth?
Youth participation is at the core of our work at ThriveAgric. We see the vibrant population of the country as an asset that can aid the fast-paced growth of the sector for better outcomes. We are currently working with over 2000 field extension workers who administer our technology to smallholder farmers across various touch points.
We also pioneered several programmes such as our Tech-Talent Accelerated Program (TAP) – a six-month internship initiative aimed at building a youth tech talent pipeline for agriculture. Through this programme, we’re training young people in software engineering (backend and frontend), product design and data analytics and providing enough industry insights that they can leverage to build innovative solutions for the agriculture ecosystem.
We also have the Youth Employability Series (YES), a knowledge-sharing quarterly series aimed at equipping young people with the required digital tools to navigate the modern workplace and most importantly how to find the best sector with an enviable national & international prospects like the agriculture space where we play in, that they can plug into and make meaningful contributions for impact.
To what extent would you say ThriveAgric has contributed towards solving global food security problems and driving financial inclusion?
Over the last six years, we have demonstrated strong operations excellence in our bid to significantly contribute towards solving the global food security challenges. We’ve built a network of over 800,000 smallholder farmers across Africa who are leveraging our technology to access adequate financing, and advisory to scale local production.
By 2022, we had produced over 1,500,000MT of grains, whilst investing over $100 million in financing. ThriveAgric now grows over 5% of the national demand for maize in Nigeria.
Furthermore, in our bid to ensure an all-inclusive Africa where the production of food thrives, we have scaled our operations to other African markets like Kenya & Ghana, with further expansions planned in other territories.
What is the place of technology and improved varieties in farming?
Technology plays a huge role in modern farming to ensure that players can sustainably scale food production to promote food security. The deployment of precision farming technologies such as drones, sensors and AI-powered analytics has been instrumental in enabling us to provide farmers with real-time data to optimise crop management, reduce resource use, and increase overall efficiency.
Our Agriculture Operating System (AOS), therefore, serves this purpose, enabling us to provide these farmers with the right technology aid, giving them access to data-driven advisory needed to ensure farming best practices. Also, by leveraging key farming data, we’re able to link farmers to the right financing as well as access to premium markets by which they can favourably compete with their counterparts globally.
How do you handle insecurity and herdsmen’ clashes with farmers?
We’ve been able to build strong collaboration with the community police in the various communities where we operate. The fact that they are home-grown operatives, they are well aware of the culture and peculiarities of the headers in their regions and so this gives us good leverage to enhance their efforts and avoid unnecessary clashes.
We also carry out periodic sensitization programmes for farmers and headers in the communities, for them to become aware of the negative effects of possible clashes and also to work with them to create routes to ease the passage of the herds.
The aim of all is to foster seamless coexistence between the farmers and the herders and foster required collaboration for maximum impact.
How many farmers has ThriveAgric worked with so far?
So far we have been able to build a network of over 800,000 smallholder farmers and the goal is to reach 10 million farmers by 2027.
It’s been a difficult year for most countries and sectors globally, with many founders finding it hard to raise funds from investors and a lot of startups shutting down. What is your take on the general startup landscape and do you foresee this continuing in 2024?
In reality, global economies had a hard turn in 2023 and this has hugely contributed to the major setbacks in different businesses especially with funding. However, we can be sure that a lot of opportunities still lie ahead in 2024 with a lot of businesses plugging into.
Meanwhile, founders need to show a high level of resilience and build a sustainable business plan and operational strategy that is well-thought-out to increase the credibility of the business and its attractiveness to potential investors.
The deployment of technology is changing the narratives across different business models, therefore, business owners must be agile and highly responsive to market change with a strong emphasis on innovative solutions & technologies they’re bringing to the market.
What is your outlook for the agric sector in Nigeria in 2024?
The agriculture sector remains a viable determiner of the nation’s economic growth and stability hence, there is so much that lies ahead. In 2024, the sector is poised for a transformative and ambitious outlook, driven by technological advancements, sustainability initiatives, and global collaboration to address global food security challenges.
As I mentioned earlier, the potentials in this sector are numerous and largely remain untapped. Therefore we expect to see more funding opportunities directed to the sector to aid productive exploration and boost local production. We should also expect to see more government intervention in initiatives and policy implementation to further futureproof the ecosystem.
Finally, as we strive to increase the capacity of players in this industry, it is also essential to pay attention to solutions that are farmer-oriented. Actors within the space need to carefully study the unique problems of the primary users of agriculture solutions and build products that address these sensibilities, ensuring that they are market-fit to achieve the right results while delivering the right value.
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