Actors transforming Kenyan agriculture through innovation
elow are some of the organisations using innovative products or approaches to transform Kenyan agricultural policy and practice who kindly volunteered as Panelists in the IDIA event.
International Centre of Insect Physiology & Ecology
Headquartered in Nairobi, Kenya, icipe has a well-deserved global reputation not just as the only international institution in Africa working primarily on insects and related arthropods, but also as a centre of excellence in this field. For close to 50 years, icipe has maintained a commitment to producing world-class knowledge towards developing and disseminating environmentally friendly, accessible, affordable and easy-to-use solutions for communities most in need.
icipe delivers its goals through four thematic areas: human health, animal health, plant health and environmental health. The synergies between these four themes present a unique framework to tackle the interlinked problems of poverty, poor health, low agricultural productivity and environmental degradation in a comprehensive manner. The four themes approach also provides a platform to build the capacity and leadership of African scientists in a cross-cutting manner while facilitating collaboration with hundreds of researchers and partners across Africa and the world.
Ultimately, icipe’s unique approach enables the effective transfer of technologies and strategies to end-users, thereby improving millions of lives in the continent. In addition, icipe receives up to 180 graduate students annually (working with 43 universities) from across Africa and elsewhere who are incorporated into the Centre’s research programmes, thus nurturing generations of highly trained scientists for the continent’s development.
In 2018, Dr Segenet Kelemu, the Director General of icipe, was selected as one of five ‘heroes in the field’ by leading philanthropist, Bill Gates, for using their talents to fight poverty, hunger and disease, while providing opportunities for the next generation.
Kenya Climate Innovation Centre
The Kenya Climate Innovation Centre (KCIC) provides holistic, country-driven support to accelerate the development, deployment and transfer of locally relevant climate and clean energy technologies. The KCIC provides incubation, capacity building services and financing to Kenyan entrepreneurs and new ventures that are developing innovative solutions in energy, water and agribusiness to address climate change challenges. The Kenya CIC is an initiative supported by the World Bank's infoDev and is the first in a global network of CICs being launched by infoDev's Climate Technology Program (CTP). The Kenya CIC is funded by the United Kingdom's UKAID and the Danish Ministry of Foreign Affairs.
Focusing on three areas – agribusiness, renewable energy and water management – the KCIC has the following goals:
Providing flexible financing mechanisms that support entrepreneurs and new ventures at varying levels of innovation and scale
Building innovation capacity through the delivery of advice, assistance and training products
Enabling collaboration and developing policies that support an innovation ecosystem in East Africa
Identifying and unlocking new opportunities through access to information and market intelligence
Providing access to facilities that support business development through co-working and networking space and technical development for rapid design, adaptation, prototyping, testing and manufacturing
So far, the KCIC has provided incubation services, grants and seed funding to more than 166 Kenyan social enterprises with the purpose of scaling up innovations and supporting climate mitigation and adaptation. Most recently (in February 2018), the KCIC signed a Memorandum of Understanding with the Kenyan Government Vision 2030 Delivery Secretariat that recognises the KCIC as the official implementing agency of the initiative ‘Promote climate technologies and innovation’ under the Medium-Term Plan for 2018-2022. The agreement also provides the institutional framework for cooperative activities in agribusiness that includes commercially viable research and development, commercialisation of technologies, incubation of start-ups, in addition to creating an enabling environment.
Endeavor
Endeavor is a 20 year-old non-profit organization that is leading the global movement to facilitate long-term economic growth by selecting, mentoring, and accelerating the best high-impact entrepreneurs around the world. Founded in 1997 by Linda Rottenberg and Peter Kellner, Endeavor has helped over 1,400 of these entrepreneurs build more than 800 companies across 27 markets, which generated combined revenues of $8.1 billion in 2015. To date, companies led by Endeavor Entrepreneurs have created more than 600,000 jobs, and often go on to mentor and invest in the next generation of founders, or serve on the boards of Endeavor offices.
Endeavor’s model works in five parts to Launch, Select, Scaleup, Multiply and Reinvest the high-impact entrepreneurship movement worldwide:
LAUNCH - Endeavor’s launch process typically takes 12-18 months. Initial “scoping trips” allow Endeavor to assess a country’s fit with our launch criteria, which look for strong macroeconomic conditions that enable entrepreneurship and markets that have a critical mass of innovative entrepreneurs who need a “jump start” to catalyse an environment favorable to new venture creation and the formation of mature capital markets.
SELECT - Through a rigorous, multi-step selection process (12-18 months), candidates pass a series of local and regional interviews before presenting to panellists from our global business network at International Selection Panels held five to six times each year.
SCALE-UP - Once selected, entrepreneurs are provided with customised services from a volunteer network of more than a thousand global and local business leaders who serve as mentors, advisors, connectors, investors, and role models.
MULTIPLY - In each country and city where Endeavor operates, we highlight our entrepreneurs as role models, helping them to transform social norms around entrepreneurship and to inspire future generations to innovate, take risks, and “think big” – the multiplier effect.
RE-INVEST - In support of Endeavor’s long-term goal of sustainability, Endeavor Entrepreneurs are expected to give the organisation an annual service fee and, in the event of an acquisition, are asked to donate 2% of their personal cash out to the organisation.
In 2017, Endeavor launched a new office in Kenya as the first-ever Endeavor affiliate in Sub-Saharan Africa to help usher in a new era of growth and economic development driven by high-impact entrepreneurship in the country. Launching with strong support from local business leaders and impact investment firm Omidyar Network, Endeavor Kenya is supporting entrepreneurs and companies in the scale-up phase — enterprises that have passed through the initial start-up phase and who demonstrate the potential for rapid expansion.
Safi Organics
Africa’s fertiliser price is 2-4 times more expensive than the world price because most fertilisers are manufactured using capital intensive processes abroad and then imported. At the same time, by 2040, the world fertiliser price is predicted to rise by 500%. This adds to the cost of food production for farmers, driving them into a vicious cycle of poverty. The use of some fertilisers may even acidify the soil, leading to long-term yield loss.
Safi Organic’s “Safi Sarvi” solution relies on two innovative steps to break farmers’ dependence on imported fertilisers. First, by converting locally available farm waste, farmers can produce their own biochar, a carbon-rich solid material. Secondly, while biochar alone is insufficient as a fertiliser replacement, in conjunction with our unique fortifying recipe, it can replace chemical fertilizers at a cost 40% lower. Notably, our MIT-developed, field-tested biochar converter is designed for extreme affordability: it costs less than $20 to manufacture and can be repaired/replaced completely locally. In this way, Safi Organics enables every farmer to locally produce their own fertilisers under 30 minutes without relying on expensive imported fertilisers.
Samuel Rigu the founder and CEO of Safi Organics, now buys rice husks, maize combs and other agricultural waste from a local network of rice processors for almost nothing, around $30 per metric ton. Then he slow burns it and adds a mixture of minced limestone and other vegetal ingredients to create a sort of charcoal, which can be used as fertiliser. He sells the fertiliser back to local farmers for $15 per 50-kg (110-pound) bag, netting Rigu up to $200 for each processed ton.
Farmers who use it have seen their farm yields increase up to 30 percent, and their income by up to 50 percent. “The fertiliser has a higher retention of water and nutrients over time versus traditional fertilisers, and also is slightly alkaline, preventing soil acidification,” says Rigu. “Most important, for every acre of land that uses our product, 1.7 tons of CO2 equivalent are sequestered from the atmosphere.” Today, Safi Sarvi, is distributed in sacks of between two and 50 kilograms from the company’s factory in Mwea where he has set up the biomass converter units. Safi Organics has also installed nearly 100 converter units for farmers at Sh2,500 ($25) a piece, a cheaper alternative than the capital-intensive large-scale products. These smokeless biomass waste converters, which convert biomass waste into soil conditioner 2,000 times faster than the traditional composting process, are also entirely fabricated from locally available and replaceable parts.
In 2016, Rigu won the the Total Startupper of the Year award across 34 African countries, and placed second in the MIT Food and Agribusiness Innovation Prize.
Twiga Foods
Twiga is a mobile-based supply platform for Africa’s retail outlets, kiosks, and market stalls and is based on the desire for the goods in African markets to be cheaper, easier for vendors to get, and better quality. Launched in 2014, Twiga Foods uses technology to consolidate the fragmented purchasing power of urban retailers, saving them a trip to the market by delivering to their doorstep better quality and better priced stock and disrupting the current system in which the brokers are the largest beneficiaries rather than the farmers. Twiga’s platform then translates this aggregated purchasing power to farmers across the country, allowing them to access stable markets at better prices, while minimising post-harvest losses through efficient logistics. It is the largest distributor of a number of basic food staples in Kenya, having sold over 55 million bananas and delivering over 4,000 orders a week.
The main reason existing supply chains do not work in Nairobi is because they lack a proper market infrastructure to support the 5 million population in Nairobi. As a result, produce goes bad and there are massive delays at the markets. This means that the cost of the same gets passed to the customer. The cost of a banana in Nairobi which has come from Meru or Taveta is the same as the price of a banana in London, which has come from Guatemala - a fundamental flaw that points to an inefficiency that only technology can solve.
Twiga is essentially building a commodities marketplace to connect farmers with customers using a business to business model. As CEO Grant Brooke explains, “the problem with the supply side (the farmers) is futures. The farmer does not know the value of their produce prior to selling it. For instance, the price of tomatoes in Nairobi was Kshs. 36 a kilo, a month ago. The price of the same is Kshs. 18 owing to oversupply. What Twiga wants to do is use technology to fix this and make it more predictable,” he adds. Farmers send SMS to alert Twiga of their produce while the staff in the field make bookings on the produce when its ready. Twiga then uses this data to create a profile about the value of a certain commodity at a certain point in the future thereby creating an organized farmers market.
“On the market side of things, the vendors face a problem with liquidity which leads to food inflation,” says Grant. “Add other market bottlenecks and the price of food stuff will keep rising. This can be solved by an oversupply, where the vendor will not at any one time lack the necessary foodstuffs to sell to their market,” he said. However, the mama mboga does not have enough cash for risk capital and so Twiga solves this by first ensuring a constant supply of the necessary vegetables and secondly offering trade credit to the customers. “Our average client orders their goods three times a week. So we give most of them a 48-hour line of credit until the next delivery. This not only allows them to sell more but helps them deal with liquidity issues,” he says. The startup primarily uses technology to score the vendors before deciding how much credit to give the vendor and this is still at the pilot stage.
Functioning as a mobile-based business-to-business food supply platform, Twiga Foods has already raised a US$ 10.3 million Series A funding round to enable it to increase the number of vendors it serves, diversify its product portfolio and introduce advanced supplier services. The US$10.3 million round was led by Wamda Capital and includes Omidyar Network, DOB Equity, Uqalo, 1776, Blue Haven Initiative, Alpha Mundi, and AHL, while Twiga has also secured US$2 million in grant funding from organisations such as USAID and the GSMA to support bolt-on farmer services, financial inclusion and domestic food safety initiatives.
In 2018, Twiga Foods was included in Fast Company’s list of “The World’s Most Innovative Companies”.
One Acre Fund
One Acre Fund is a non-profit social enterprise that supplies financing and training to help smallholders grow their way out of hunger and build lasting pathways to prosperity. When farmers improve their harvests, they pull themselves out of poverty. They also start producing surplus food for their neighbors. When farmers prosper, they eradicate poverty and hunger in their communities.
One Acre Fund is growing quickly and we are proud to soon represent Africa’s largest network of smallholder farmers. By 2020, we will serve at least 1 million farm families - with more than 5 million people living in those families. And the farmers we serve will produce enough surplus food to feed another 5 million of their neighbours. This is only the tip of the iceberg. When millions of farmers speak with one voice, we can more effectively pursue collaboration together with government and the private sector to broaden our reach.
Rural poverty is complex, and there is no single solution to the problems farmers face. That’s why One Acre Fund takes a holistic, long-term approach. We offer a complete bundle of services, using a market-based model that helps our organisation remain financially sustainable and expand to reach more and more farmers every year. After first starting in Kenya in 2006, we've grown to now serve over 500,000 hardworking smallholder farmers across six countries in Eastern and Southern Africa.
One Acre Fund has a revenue-generating operating model: About 75% of our field expenses are financed through farmer loan repayments, with donor dollars covering the rest. Improving financial sustainability is a key component of our expansion strategy. We want to grow quickly, but we know that outside funding may not always keep pace. Technology is one way we’re boosting our efficiency. Putting Farmers First in everything we do not only keeps us mission-aligned—it also helps us grow. Some of the principles that have driven our expansion over the past 10 years include:
A focus on Impact - If our clients see reliably better harvests year after year, more people will want to enrol with us. We have well-developed innovation and impact measurement departments to ensure we’re consistently delivering high-quality products and services.
A focus on Outreach – If we’re embedded in communities, our clients trust us, and they recommend us to their neighbors. That’s why our model relies on building strong relationships and person-to-person marketing.
A focus on Trust - Integrity is one of our core values—we do what we say we’re going to do, and we’re committed to staying with communities for the long haul. The trust we’ve earned with clients, local governments, and community leaders is one of our biggest assets.
Digifarm
“Safaricom’s purpose is to transform lives through the use of mobile technology. We have a customer base of more than 26 million subscribers in Kenya. We’re therefore ideally positioned to leverage technologies that will empower Kenyans with opportunities and give them the right tools for economic growth.”
Fred Kiio, Head of Commercial Operations and Segments at Safaricom, is passionate when he talks about his company’s role in Kenya. When we look at the company’s ongoing achievements in the field of technology and innovation (amongst others, being the home of the renowned Mobile Money service – M‑PESA), it is easy to see why Safaricom is acknowledged as Kenya’s leading communications service provider and important contributor towards the country’s economic growth by empowering people.
Digifarm – the company’s latest innovation using mobile technology in the field of agriculture – certainly supports this statement. This mobile phone-based solution allows government and service providers in the field of agriculture to interact with and offer agricultural-related services to smallholder farmers in Kenya who, previously, had no access to any support structures.
Digifarm development started in October 2016 and the pilot phase was introduced in three Kenyan counties a mere three months later in January 2017. The aim of the pilot phase was to get the solution ready for national adoption and to bring the ecosystem partners on board:
Safaricom/Mezzanine for platform provision
Iprocure Kenya for inputs provision
Arifu for learning content provision
Mercy Corps – Kenya (Agrifin) for bringing the smallholder farmers on board and to provide functionality insights.
Within 45 days of launching, 90,000 farmers had registered on DigiFarm, and now there are more than 800,000 farmers on the platform. Meanwhile, Safaricom’s parent company, Vodafone, is looking to copy the Digifarm template in other markets where it operates, including Egypt, Tanzania, and India. Given that there are more than 500 million smallholder farms in the world, there’s plenty of market to go after.
FSD Kenya
FSD Kenya was established in 2005 by the UK’s Department for International Development to support the development of inclusive financial markets in Kenya. The conceptual underpinning of FSD’s work is the “making markets work for the poor” (M4P) approach, which allows agencies to build on a detailed understanding of market systems and a clear vision of the future to address systemic constraints and bring about large-scale, sustainable change.
FSD’s long-term goal since its inception has been to generate sustainable improvements in the livelihoods of lower-income households through reduced vulnerability to shocks, increased incomes and employment. Our strategy focuses on three core elements through which value is created by financial inclusion: use, cost and trust. There has long been an implicit assumption that the only important constraint is cost. This certainly remains a significant factor but it is unlikely to be sufficient. We believe that realising the promise of inclusion depends on developing financial solutions which address real world problems. In other words, we need financial services which do useful things for people and businesses.
FSD works with a wide range of partners in Kenya to address systemic constraints that hinder financial markets from benefiting poor people. Our stakeholders include policymakers and regulators, notably the National Treasury and Central Bank of Kenya, key industry associations such as the Kenya Bankers’ Association, to small and large innovators in the financial sector. We try to stimulate change in a variety of ways – though policy advice, technical assistance, applied research, co-funding, risk-sharing and very occasionally early stage investment. Ultimately, whatever approach we take is driven less by the particular instruments we have available and more by what is needed to address a particular market development problem or opportunity.
FSD Kenya is committed to becoming a thought leader in understanding the opportunities and constraints in Kenya’s financial sector and working with stakeholders to help define a vision of how it can and should develop. Today, the idea of a fully inclusive financial system, while still some way from being achieved, no longer seems fanciful. The potential for finance to become a more effective tool for stimulating development and poverty reduction is stronger than it has ever been.
Government of Kenya
Kenya’s Vision 2030 is the national long-term development policy that aims to transform Kenya into a newly industrialising, middle-income country providing a high quality of life to all its citizens by 2030 in a clean and secure environment. Innovation is at the heart of Vision 2030, as is the recovery and growth of the agricultural sector. To spearhead the innovation agenda, a comprehensive policy on Science, Technology, Innovation Policy and Strategy (STIPS) was created in 2009 to mainstream innovation across all sectors, with agriculture as one of the top priorities. Since then, various Ministries have introduced different policies supporting the agricultural innovation ecosystem, including:
National Youth Agribusiness Strategy
Agriculture is also recognised as a sector with great capacity to absorb many of the young people in Kenya, who make up 35% of the population but have an unemployment rate of 67%. National policies, especially Kenya Vision 2030, acknowledge the role of agriculture as a key economic driver and advocate for the involvement of youth, but the majority of those engaged in agricultural activities in Kenya are aged between 50 and 65 years, and still predominantly practice traditional and subsistence farming.[1] As a result, in July 2017, the Government launched the National Youth Agribusiness Strategy (2017-2021) to support agricultural entrepreneurship, technology development and processes to enable new agribusiness markets to be accessible to (and driven by) Kenyan youth.
African Intergovernmental Network on Open Data for Agriculture and Nutrition
The government of Kenya is championing data revolution as the key to unlock the potential of many sectors, but in agriculture in particular. The Ministry of Agriculture, Livestock and Fisheries and partners have embarked on efforts to leverage innovative approaches geared to solving these unique data and demographic challenges. This included a Global Open Data for Agriculture and Nutrition (Godan) ministerial conference in Nairobi in June 2017 to champion data-driven agriculture, and the subsequent creation of an African Intergovernmental Network on Open Data for Agriculture and Nutrition bringing together Congo, Ghana, Kenya, Uganda and Rwanda. Support will be provided by the Food and Agriculture Organisation (FAO) and the Alliance for a Green Revolution (Agra). This network will nurture an inclusive multi-stakeholder ecosystem that includes small-scale farmers, aggregators, processors, and marketers.
Kenya Innovation & Entrepreneurship Project (KIEP)
A partnership between the Ministry of Industry, Trade & Cooperatives and The World Bank Group, KIPE is a project originating under Vision 2030 and is designed to increase innovation and productivity in select private sector firms. Over the course of 2017, the Project Implementation Unit held consultations with over 200 private sector stakeholders (in addition to other government departments) to identify ways to strengthen the innovation and entrepreneurship ecosystem. Subject to final World Bank Board Approval in May 2018, the project will then invest in a range of initiatives designed to support incubators, accelerators and hubs; strengthen rapid tech skills training providers; and invest in platforms to better connect academia to industry and industry to start-ups.
[1] Source: Daily Nation (Kenya) ‘Youth Friendly policy to bring ‘the cool’ into agriculture’, 18 July 2017.