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Agriculture

How FarmCrowdy Became Nigeria’s Top Agritech Startup

The vast majority of Nigeria’s 38 million farmers grow crops and rear livestock and poultry on a relatively small scale. For them, the seasonal nature of agriculture is a big constraint. Revenues come in at specific periods of the year, but these periods are often too far apart, and the funds from the previous season’s produce sales barely cover the costs over the next farming season.

In 2016, a team of professionals got together to solve this problem. They founded Farmcrowdy, an agritech startup which connects farmers with sponsors willing to fund their farms in exchange for a share of profits.

Today, there are thousands of farmers on the platform’s network, and they’re getting support from thousands of more sponsors. It’s still a small fraction of the country’s farmer population, but it’s enough to inspire talk of a tech-driven revolution in Nigerian agriculture.

Chasing a Tech-Driven Agricultural Revolution

Ifeanyi Anazodo thinks it’s a goal worth pursuing. As VP, Data and Intelligence at Farmcrowdy, he oversees the collection and use of vital data from the field to help improve the startup’s operations. He’s also one of the startup’s co-founders and says the team’s startup idea was inspired by the government’s talk of diversifying the economy away from oil.

“Onyeka Akumah (who’s now CEO) assembled us the founders, and we were looking for opportunities in the agriculture space,” Anazodo recalls. “The big question was: ‘how do we get involved?'”

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The answer came as they talked with farmers about their challenges. Top on the list of their concerns was poor access to finance, shortage of technical expertise, and the difficulty of getting buyers who were ready to pay a premium for farm produce.

The team hit upon an idea. They knew that these farmers needed resources to help them sustain and scale up their farms’ productivity. But they were also aware that a large number of other people had funds and were willing to invest in agriculture, but couldn’t steal time to set up their own farms. All they had to do was find a way to connect these two groups.

“Farmcrowdy came in to connect these two parts”, Anazodo explains. “What we essentially do is get in the money from those sponsors, and based on protocol, allocate to the farmer everything they need, from start to finish: seed, fertilizer, labour, cost of transportation to the market, and so on.”

Making It Work

It wasn’t exactly plain sailing from the start. Anazodo says one of Farmcrowdy’s biggest concerns, in the beginning, was hiring people with the right expertise.

“Generally, this is a problem that most startups face. We need the best hands to get the best results.”

But they already had this partly sought out: the founding team was a group of friends, who were all skilled professionals.

“Relationships were pivotal to how we started,” notes Anazodo. “There had been prior relationships with all team members.”

There was also an issue with finding the right way to work with farmers. Most farmer communities farmed on lands that were small and in close proximity to each other. They also found that there was a need for a validation system, which would make it easier to ascertain the farmers’ trustworthiness and track the progress of their operations. Anazodo says the solution was to persuade the farmers to form cooperatives.

“Right now, we get our farmers through cooperative societies,” he says. “That way, farmers are able to account for each other, and you can work with them in a cluster.”

Young Farmcrowdy farmers receiving training from a Farm Specialist. bellanaija.com

Present Successes and Aims for the Future

Farmcrowdy’s digital platform is what makes its sponsor-farm linkup possible. Farms up for sponsorship are listed on the Farmcrowdy website, making them visible to anyone who wants to sponsor them. Potential sponsors can select a farm they would like to fund, and buy a stake in it.

In the early days, the team had to convince potential farm sponsors that the Farmcrowdy model was viable. Things have taken off since then; over 2,000 sponsors and followers have funded farm production projects so far, and have received returns of between 6% and 25% on their sponsorships.

The figures for farmers on the platform are also impressive. Farmcrowdy’s data puts the number of farmers it’s worked with at over 7,000. These beneficiaries, who run about 8,550 acres of farmland, are spread across nine states: Lagos, Ogun, Oyo, Osun, Edo, Akwa Ibom, Kwara, Kaduna and Plateau.

Although Farmcrowdy has stacked up a good number of awards already, Anazodo points out that there’s a large swathe of the agricultural sector that the startup needs to reach. When asked about the company’s future plans, he says they are aiming to expand operations in Nigeria, and get into other parts of Africa as well.

“For us, it’s basically increasing our coverage around Nigeria, and replicating this model across Africa, possibly Ghana or Kenya. Anywhere our model can be replicated is a good opportunity for us to get in.” – Anazodo

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Ikenna Nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

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