After spending over five years in the agriculture cropcycle space building business models on the ground and understand the smallholder challenges to fair depth which has been a great learning. There are 450m smallholder farmers and Investing annual opportunity is $450 Billion dollar opportunity!
There’s one common factor among 450m small holder farmers. Fragmentation is a 100% of land and farming and technology mobile density is over 80%.
However capital is not the answer as it is currently disconnected from the ecosystem and network effect!!! The business models are.
Why? With access to often expensive capital, Agricultural productivity did not go up, rather went down due to lack of access of best practices, cropcycle management practices, oversight and risk mitigation and lack of access to agricultural expertise and analytics and lack of access to full market pricing. The bottom line. Small holder farmers are in greater debt from each cycle for all the reasons mentioned above.
The key is connecting the need for aggregation of network resources to enable;
1. Precision Cropcycle “Productivity”
2. Ecosystem “Aggregated Cost Optimization”
3. Ecosystem “Precision Risk Mitigation”and
4. Ecosystem “Aggregated Price Discovery”
5, Enable an economic model for Inclusive and Sustainable Agriculture
The opportunity to contribute to potentially hundreds of millions of people who are constantly challenged by basics and yet expected to feed the world is a great mission to go after, while making it a for-profit business for all to scale and sustain, without the need for subsidies considering this is a global market of Scarcity, commodities and food.
This is what we are working on. Combining a business model + technologies around Bell’s Law (Internet of Things + GEOINT + SIGINT + MASINT + OSINT+ CYBINT + HUMINT) that commoditize data collation via algorithms that drive the core business of agriculture and provide “Network API” for th ecosystem to conduct business.
While the headlines scream the scale of the financing opportunity and capital is cheap internationally, the challenge is not capital but more fundamental.
The market is a critical and global in scale. So why is this such a critical market opportunity today.
1. The smallholder farmer represents the folks who feed the world
2. Need to optimize resources – Water, Energy and IP. Capital is cheap.
3. Need Availability, Accessibility and Affordability of hyperlocal or Precision Agriculture for their individual land;
i. Cropcycle next practices
ii. Cropcycle inputs – Seed, Fertilizer & Pesticide
iii. Cropcycle risk mitigation – Climate, Crop & Pest
iv. Business risk – Access to downstream demand side markets, insurance from upstream cropcycle of 4-6 months, twice a year
vi. Access to mechanization and labor services that enable the cropcycle management, oversight and mitigation
4. Capital to enable all of the above, not as capital, but as a business model embedded into the cropcycle
1. Upstream (Farmers, Agri OEMs and Finance valuechains) – Aggregation creates economies of scale drive Insights from Analytics
i. Reducing costs of inputs, fertilizer, crop inputs, fertilizer, expertise, and supplychain
ii. Increase in Productivity, Yield & Predictability
iii. Decreasing costs of Risks
iv. Bringing the best agri expertise as services & monitoring in real-time
v. Creating the next cycle with lower Carbon, water and energy footprint
2. Midstream (Processors) – Aggregation creates economies of scale & scope drive Insights from Analytics
i. Reducing costs acquisition and processing
ii. Increase in Productivity & Predictability
iii. Decreasing costs of Risks
3. Downstream (Value-add derivatives, Finance valuechains, Wholesalers and Retailers) – Aggregation creates economies of scale & Scope drive Insights from Analytics
i. Lower costs acquisition and distribution for Wholesalers & Retailers
ii. Increase in Predictability
iii. Decreasing costs of Risks and costs to Consumer
So what does this look like. Software (APIs) eat hardware. A crowdsourced aggregated marketplace that connects the dots of Upstream, Midstream & Downstream together.
So this is a very exciting opportunity and a perennial one. After all you are dealing with an incredible opportunity of “Scarcities” as a market. Population explosion from current 7B to 9B in 2050, rising costs of commodities, irrigation, energy and markets.
I’ve been asked as to why I seem to be broadcasting a potentially disruptive business plan. The answer is simple. If you really have the vision, passion and team to execute around fundamentals, you will. So if anyone is going to borrow the idea, it’s the team and the execution that will steal the mission and make a difference.
HOW JOHN DEERE & AGRI OEMS CAN DISRUPT AGRICULTURE? APPLE, GOOGLE, BLACKBERRY & APPSTORES MAYBE THE ANSWER?
KILLER APP! FRAGMENTED MARKETS, CROWDSOURCING BUSINESS MODELS AND MOBILITY
CROWDSOURCING MARKETPLACES AROUND INTERNET OF THINGS ARE DISRUPTIVE
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THE NEXT “MOBILE” IS THE “AUTO-MOBILE” AND DETROIT THE NEXT VALLEY?
- How To Help 450 Million Poor Farmers – Without Destroying The Earth (forbes.com)
- Small-scale agriculture holds big promise for Africa (theguardian.com)
- Smallholder Farmers Key to Food Security (voanews.com)
- Small farmers need new technologies, adapted to their farming circumstances (IFAD) (desertification.wordpress.com)
- Farmers ask government to inject oil revenue into agriculture (ghanabusinessnews.com)
- Ghanaian farmers to suffer from climate change – EPA (ghanabusinessnews.com)
- Investment in agriculture necessary to feed the two billion who will go hungry by 2050 (sierraexpressmedia.com)