This will allow the company that one of us started, ColdHubs, to build ten more solar-powered, digital-monitoring cold storage units in rural commodity markets across Nigeria. These units reduce food spoilage by 80% and can increase the annual income of smallholder farmers by up to 50%.
This will allow the other company, Hello Tractor, to pilot its pay-as-you-go tractor finance product that will unlock low-risk, low-cost tractor loans for rural entrepreneurs serving smallholder farmers, enabling those farmers to plant. their fields efficiently when the time is right.
Africa urgently needs innovative solutions that address a range of challenges and opportunities.
The two companies will create thousands of jobs along the way, generate significant profits for participating farmers and help build more efficient food systems across the continent.
But this price goes far beyond our businesses.
It is about what young African agricultural technology entrepreneurs are doing and will do for the continent. A new generation of young business leaders, techies and agricultural experts are solving agricultural and food security dilemmas in real time, while positioning Africa as a leader in agrotech solutions.
Africa urgently needs innovative solutions that respond to a range of challenges and opportunities. Growing consumer demand on the continent for food is expected to generate a market worth $ 1 billion by 2030.
At the same time, climate and weather changes and pandemic disruptions are accentuating the challenges facing food systems. A recent survey found that around 40% of farm organizations have been forced to close at least temporarily due to the Covid-19 pandemic and 36% still do not have the financial capital to grow their business.
All of this requires innovation, creativity and entrepreneurship on the part of entrepreneurs and their financial partners.
We saw how agritech can effectively fill critical gaps in access to information, finance and markets for farmers and agribusinesses. Its products are often available by phone in the pocket of any farmer. Other innovations use artificial intelligence, remote sensing, virtual reality, drone technology and other precision tools to measure precipitation, control pests and analyze soil nutrients.
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Yet few of these tools have reached large-scale use, and only 23% of young people engaged in agriculture in Africa use any form of agricultural technology. They are held back by a lack of funding, weak political support and the desire for certainty about the return on investment. More fundamentally still, the conception of agriculture as a tool for development rather than as a business has slowed down its growth.
As we have seen with the Covid-19 pandemic, the new generation of agrotech entrepreneurs can help turn this situation around.
When measures put in place to contain the spread of the virus severely disrupted food systems, businesses had to scramble to survive. It was also our experience. Hello Tractor quickly saw its supply chains shut down. Commercial activity has slowed down. The banks have withdrawn their loans. Curfews and closures prevented us from moving material across county lines.
To use more tractors in the field, we created incentive programs and hired our first sales agent. Using tools like WhatsApp for business, SMS, Facebook and Google ads, and direct calls, we’ve stepped up our digital marketing to tractor dealers and smallholder farmers. In this way, we were able to keep the business going and even look for new growth opportunities.
READ MORE Four ways to increase agricultural productivity in Africa
The pandemic has also had a dramatic impact on ColdHubs. Our revenues in 2020 were a third of that of 2019. With roads and markets closed during pandemic lockdowns, we had to shift our focus from ColdHubs in markets to units serving agricultural clusters. Farmers who were able to use ColdHubs’ storage facilities near their fields were able to extend the life of their crops by 21 days, and even survive closures, while other farmers saw their crops fail, unharvested, in their fields.
We know of other entrepreneurs across the continent who have championed solutions for small farmers throughout this pandemic. For example, in Rwanda, a group of four young people developed an “AGRITrials” mobile app to connect farmers using Android phones with markets, experts and fellow farmers, and provide them with access to accurate farming information at a time when face-to-face meetings were impossible.
We have seen what young African agro-tech entrepreneurs can do, and the difference it makes for small farmers. They are leading a revolution to transform African food systems. They need the support of government policy and innovative financing, whether through competitions like the AYuTe Africa challenge, or through banks, credit unions, government agencies and business partners who understand the value of innovation, creativity and enterprise.
Jehiel Oliver is CEO and Founder of Hello Tractor and Nnaemeka Ikegwuonu is CEO and Founder of ColdHubs. They are champions of Africa AYuTe 2021.