In Africa, there is an estimated one extension worker per 4,000 farmers, compared with one per 200 hundred farmers in developed countries. This ratio falls far below the Food and Agriculture Organization (FAO) recommendation of 1 officer for every 400 farmers.
To bridge this gap Nigeria-based agritech startup “Rural Farmers Hub” has developed a remote extension service delivery application called Capture and is working on a big data analytics technology named Village Chief. While Capture is a remote extension delivery software that provides farmers with advisory services via SMS or voice app, Village chief is a big data analytics dashboard, that helps farm organisations, industries, corporates and government make key agribusiness decisions; both applications leverage satellite data extensively.
In an interview with Space in Africa, Rural Farmers Hub Chief Executive Officer, Olusegun Adegun, and Chief Operating Officer, Gabriel Eze, discuss the company’s journey over the past two years and plans for the launch of Village Chief. The startup is among the 10 African startups in this year’s cohort of the Africa4Future Aerospace Acceleration Program powered by Airbus Bizlab and GIZ Make-IT in Africa, and implemented by CcHUB.
Read the Q/A below.
How was the beginning when Rural Farmers Hub launched, and how is the journey so far?
We started the journey in November 2018 to solve the problem of market access across the agriculture-food value chain. I had worked in the international development space with development organizations such as GIZ and the African Development Bank. I had an understanding of where the gaps are across the value chain. We decided to focus on the problems in market access by creating what we call a smart aggregation system. We built the system to aggregate products of smallholder farmers and make them available for premium buyers. That was where we started from, but we quickly realized that we could not sell products as premium if the crop is not the right quality.
We quickly pivoted from the aggregation system to extension service. With the pivot, we understood the fact that extension service has been there for a very long time but needed some automation to make advisory services more remote and efficient because most of the extension service across the country is physical. We set out to automate the process and make it a whole lot easier for advisors to connect with the farmers remotely. That led us to build a new extension delivery software called Capture which provides crop yield advice to farmers on issues of water, weather and soil fertility.
With the algorithm we built in-house, our software can process lots of satellite data into essential human-readable information for the farmers to use. We make the information available to farmers via SMS and in their local language. Farmers who are not able to access the information via mobile phone, rely on extension agents in person to get the information.
How is the typical relationship with farmers monetized? Are they all signed up on your platform to receive the information via SMS, or are they working directly with your network of extension officers?
We started with a B2C, working directly with about 500 farmers in rural communities. Still, we discovered that a lot of farmers are not ready to pay for extension services because they underestimate the value. We found it difficult to glean money directly from the farmers. So we moved from a B2C to B2B, where we began to discuss with farm organizations and not farmers directly. For instance, we got in touch with Sasakawa Farm Association which is a regional organization operating in North and Southern Nigeria, with about 200,000 farmers in Kaduna state alone. They have been doing extension services for a very long time with some infrastructure on the ground. We supported them with the Capture Technology provided to the extension officers and helped them to reduce cost and commute hours of travelling to all the remote villages.
Another large organization we signed up is the National Agric Extension Research Liaison Services (NAERLS), which is the national body of extension service providers in Nigeria. The extension officers within the organization are using Capture to serve the farmers. In summary, we moved from a B2C with direct contact with the farmers down to a B2B model, where we deal with the farm organizations that support farmers. The farm organizations are the ones that pay us on behalf of the farmers.
Extension service providers are vital to your ecosystem and service delivery. How do you monetize your relationship with extension service providers?
Extension service providers and farm organizations use our technology to be able to serve their clients, which are the farmers. Our offering is a subscription-based model, and the organizations pay for it. They pay according to the number of farmers that they want to be subscribed on the platform. The extension agents have dashboards on our platform where they monitor the farms on near real-time.
What key metrics are your customers using us success metrics when they adopt Capture?
The major metrics are improved yield, income and yield productivity. In the communities where we worked in the past, we have seen results of 17 to 35 percent increase in output. In terms of income, farmers are seeing income growth of about 17% using Capture in our ongoing pilots. Also, we have seen an increase in yield productivity which has enabled the farmers to sell their products on premium. We shall continue to experiment and have the farmers return with better results. On a broader scope, we are contributing to food security and climate change because inappropriate use of fertilizers and chemicals affect the environment.
I see on your website that you offer an agro-product marketplace and microfinancing platform. How are these sections of your business coming up?
The marketplace is currently operational, but we have not seen commendable traction in that category. Most of the marketplace business we did in the past was conducted offline and not executed via the platform. We did not get a good value for the farmers because of the requirements for premium products. Also, the micro-financing service has received less traction than we anticipated. Our business has been primarily driven by the extension service offerings powered by our technology.
What milestones have you achieved as a business?
Our most significant milestone so far is increasing revenue. November will make it two years since we started the business and we have made about USD 16,000 plus in revenue. Also, we have been able to increase the number of farmers on our platform. When we started, we had about 200 farmers, but now we have about 5,000 plus farmers on our platform. We are seeing results where 75% of farmers in our farming communities have increased their income by over 17%.
Have you raised or looking to raise external investment?
We have not raised any money. We are running on revenue and bootstrapping our way through the process. We are looking to raise anywhere between USD 50, 000 to 100,000 in pre-seed money. However, what is much more important to us besides raising money is to have corporate collaboration with, for instance, a seed company that uses extension service and have an outgrower program, or a bank that needs to give microcredits to farmers. They can collaborate with us as vendors for the extension delivery. Those are the kinds of fundraising we are looking at the most.
Can you talk about Village Chief, the satellite-enabled big data analytics dashboard you are developing?
Village Chief will help corporate farm organizations, governments, development agencies and industries to make better business decisions. For example, institutions that have outgrower programs and plan to monitor progress on the farms in near real-time will leverage Village Chief to achieve that. They can have near real-time information on what the farmer is planting, harvest timeline, required amount of farm inputs, among other vital insights. We also see other application use cases such as monitoring government intervention programs, especially with COVID-19 travel restrictions.
In terms of business model, how do you see Village Chief supporting your ecosystem and contributing to your revenue base?
Recently, the Nigerian government placed a ban on the importation of maize. There is a lack of accurate data to provide enough insight for the government and industries on the number of smallholder farmers planting maize across the country. With Village Chief, both the government and the industry can have accurate data on maize farming and farmers in the country. We anticipate that this value will contribute to our revenue stream and support our core which is to make vital information available to farmers and other stakeholders.
When do you plan to launch Village Chief for commercial use?
We plan to launch Village Chief in four to five months.
What other future milestones are you looking to achieve?
We have started expanding across the African region, beginning with Burkina Faso, and preparations on gear for countries such as Niger, Côte d’Ivoire, Mali and other countries. The process is currently ongoing in these countries. We have started a pilot with an organization in Burkina Faso. In Niger, we plan to work with the Bank of Agriculture and the Ministry of Agriculture. We can serve thousands of farmers remotely from our location in Nigeria. We can scale very fast without significantly increasing the core cost of operation; that is the beauty of our extension delivery tool.
In terms of traction, we are not expecting to see a massive bump up in user numbers this year as we are still deploying the technology and piloting the project. We plan to pursue exponential growth in the number of farmers reached with Capture by next year. We are also open for business with other organizations that work with farmers. We believe that many organizations in Africa and beyond can gain significant value by using our technology to support farmers. Capture already has an application programming interface (API) that enables other organizations to leverage our advisory services on their platform, and likewise, Village Chief which integrates seamlessly with other third-party software.
How was your experience with the Africa4Future Aerospace Acceleration Program?
The first three months were experimental and great. We are continuing with post-acceleration engagement for the next nine months. We had some great learnings from the process and developed a better understanding of the systems thinking approach to product development. We answered difficult questions about our product and became better with all the feedback from the facilitators. We saw tremendous value, especially as we improved our communication. We are hoping to gain more great value from the post-acceleration program when we launch the Village Chief analytics dashboard.