[00:00:00] Wendy: Hello everyone and welcome to the evolve.ag podcast. My name is Wendy I am the creator of evolve.ag, and I'm thrilled today to have on the podcast the folks from Emata. I have Bram Vandenbosch, who's the ceo, and Lillian Musake the product manager. Welcome to the podcast, you two! Thank you so much for joining me.

I'm absolutely thrilled to have you.

[00:00:23] Bram: Hi,

[00:00:23] Lillian: you, Wendy.

[00:00:24] Bram: Thanks for having us.

[00:00:26] Wendy: Thank you so much for being on it. I'm super excited to talk about the FinTech technology you all are creating in Africa. Emata is a FinTech company. It's based in Uganda and it's bringing loans to farmers. Would you like to just start by talking a little bit about what it is Emata does?

[00:00:43] Bram: Yeah, sure. Let, let, let me, let me go first. So, farming is incredibly important to Africa. In fact, it is the backbone of African society and African economies, accounting for a staggering 30% of the economy and 70 to 80% of employment. So it's really, really big. But for a number of different reasons, farmers are often left out out of the entire banking system in a quite dramatic way.

So just to illustrate this, whereas right farmers contribute 30% to the economy, they only get three, four, maybe 5% of all the loans that are going around. Just to illustrate this, right, so they're economically super important, but they're kind of left out by the banks and, and because these farmers do not get the loans that they need, they cannot invest in their farms.

They cannot buy seeds, they cannot buy fertilizer, they cannot get a tractor. They cannot prepare their land when it's needed, et cetera, et cetera. And that brings us in a situation where Africa has tremendous potential. To develop its agriculture even further, right? We all drink the coffee coming from Africa, we all eat the chocolate coming from Africa.

This could be way, way bigger, right? The reports indicate the harvest could be 10 times bigger. I kid you not 10 times bigger. But that only happens of course if farmers are able to right? Professionalize their farms, invest in their farms and, and, and up their game for which, right? Like everybody else in the world, they need money, right?

They need to be able to invest. And that is what we as Emata are ultimately. As we like to say, right, we dare farmers to dream big by allowing them to invest in their farm and in a productive future.

[00:02:24] Wendy: Wonderful. That's really exciting and very positive as far as the world of agriculture goes, for sure. Can you tell me a little bit about your background? What got you interested in this and, what brought you to Africa to do this type of work?

[00:02:38] Bram: Yep. So I, I used to be on the wrong side of the fence. I used to be a big banker you know, an investment banker flying all across the world. And for a number of years I was actually an investment banker focusing on agriculture specifically, specifically the former Soviet Union. So I was doing a lot of agriculture investments in, in Ukraine, Russia, Kazakhstan, Romania, and the.

And there to some extent, you had a similar situation where the agricultural potential was absolutely tremendous. But there wasn't sort of big enough money going into the region to, to develop it. After a number of years I, I personally was sort of not feeling so fulfilled anymore with working for the bank, right?

I sort of learned what I could have learned, and it was all starting to feel a little bit like, you know, routine. I have all these ideas that I wanna do, and I think banks can do so much more, but why are they not doing it? So I, I decided that my, my time was up and, and I left the bank.

Then I ran into an old study friend of mine who actually set up a, a FinTech company in Uganda. And this FinTech company was making banks for the, the Scandinavian market where they had a big office as well as sort of had a view on okay. Right. This East African region is very interesting.

Things are developing fast technology is, is, is sort of. It's becoming a thing here. We should do something. So he, he asked me to come over and have a look, meet the team, which is also when Lillian and I met back in 2017 and I was there for a couple of weeks, but then the first week I knew like, okay, right.

This. This can happen, right? The, the talent that was there in terms of technology, the apathy that, that the banks had in the region, right? They were not gonna solve this. It was clear that with sort of modern, a technology with modern, a data science, this could be solved and that. We, we could form a team to do that.

So I initially joined at companies, or where Lilian and I, together with our cto, Dave all, all worked together. And while we kept on servicing the banks, we were sort of doing the prepara preparatory work to, to launch Emata right? We're doing our pilots, we're trying to figure out, okay, right, if we're gonna do this at scale, how would that look?

And can that be done? I'm sure we're gonna talk about that. But sort of to launch a high tech solution in a rural setting in Africa is, is a heck of a challenge. So we're doing quite some pilots just to see like, okay, right, can this actually be done? And by the time we felt that this could be done, we said, Okay, good.

Let's, you know, let's hit the button. So that's a little bit my story and how Lidian and I got acquainted. But Lillian, I know your story is also an exciting one.

[00:05:09] Wendy: Yes, please share.

[00:05:12] Lillian: Well I dunno about exciting, but. Story. I started out as a software developer at the farm that Bram was talking about. That's Lab Uganda. We built together with Bram and the team. Were building FinTech for digitizing banks, both in Europe and here in Uganda. And there I had a passion to really build solutions from a conceptual level.

And the conversation to become product manager started, I think in 2018, 2019. And at that time I was not very confident. I still wanted to do a little bit more development and. But I also realized I was growing a bit more passionate to create real solutions for real farmers or impact my community in a positive manner.

To give you an idea, 80% of Uganda's populations are in agriculture. So my parents, my grandparents, Almost everyone I know has in some way been affected or influenced by agriculture. So that I so was an opportunity to directly influence or do something that impacts the people of my country. So I jumped on it with a lot of persuasion from Bram , but I have never looked back since.

It brings challenge every day, but we're even happier to solve for farmers. Yeah.

[00:06:40] Wendy: That's wonderful.

[00:06:41] Bram: Lillian grew up next to the company that we work with in the coffee sector, . So that's how close this product is to my life. Really.

[00:06:51] Wendy: Wow. Wow, that's amazing. So this is very personal for you then.

[00:06:56] Lillian: Yeah.

[00:06:57] Bram: Yeah, no, this is a, this is a case of a definitely in my backyard, uh, situation.

[00:07:01] Wendy: Yeah, absolutely. Can you talk a little bit about how Emata works for a farmer? Do you just give out the loans yourself or do they use an app? Like what, What does the whole process look like and the whole product look

[00:07:12] Lillian: So Emata solves a different set of problems. We partner with cooperatives, these are farmer groups and aggregators. And what we do for them, we provide a digital solution that helps them better manage their farmers. And this is free of charge. And as in return they give us access to these farmers' data we use alternative credit scoring. Algorithms to create credit limits to, for these farmers. These credit limits are tailored for individual farmers, so each farmer has a different credit limit and then we give out the loans using WhatsApp. So we use very easy to use WhatsApp chat bot simply because these cooperatives had have administrators that are less technical, so we needed to use something.

Is very famously known. And in Uganda alone, WhatsApp is a well known and well used platform. So we created a chat bot to allow cooperatives to request loans on behalf of farmers using that platform. Do you have any additions to that?

[00:08:26] Bram: Yes. We like to talk about certain steps that, that sort of define how how our process work. And each step one is where we digitize our partners, which are mainly comparatives which means that we can get access to data. Step two is we convert this data together with satellite data, weather data into credit limits.

So right, we automatically credit score thousands of farmers in one go. Then step three, we give out these digital loans, which we do ourselves. We have our own lending license. And our own fund from which we land. These loans can either be in what's called mobile money or M Pesa for, for some people who who are less familiar with the mobile money term.

But these are bank accounts tied to your SIM card, or these are loans that are used to pay for things that farmers buy in shops such as seeds and fertilizers. And then step four one of our favorite steps, farmers actually don't have to repay. Da da da da. The only thing you need to do is keep on delivering whatever they're growing to our partner.

And, and then the partner converts that into cash and sends that to us. That's a

[00:09:24] Wendy: And the partner is the cooperative. Is that

[00:09:27] Bram: correct? Correct. We predominantly work with cooperative, or cooperative like organizations , This can be aggregators, processors, even exporters, anybody really who works with a large group of farmers and, and buys from them.

[00:09:40] Wendy: Got it. Can you talk a little bit about what the cooperatives do as far as like what role do they play with the farmers?

[00:09:46] Bram: Yeah, that one is quite big. So in the villages where, where most of our farmers live, Two things are very important. That's normally the church and the comparative That's right. That is the social structure of the village. So this is really, really remote. So it's often too far away from, from any real shops or, or trading centers, meaning that the comparatives make sure that all the inputs, all the things that a farmer needs, reach those villages.

They make sure that the knowledge that these farmers may not have because they may not have a formal education. Reaches them and they are sort of the link to the market at the same time. So right when the time comes, they make sure that trucks are being sent to those villages to buy the produce to make sure that all the farmers get paid.

So they're really the linking pin in, in any value chain between all the input suppliers, on the one hand, all the knowledge providers on the other hand. And lastly, sort of the market, right? Because. As I mentioned earlier, Africa is, is one of the largest producers of coffee and chocolate. But in these villages themselves, nobody eats chocolate or nobody drinks coffee.

Right. So it is the comparatives that, that pick up all these beans and make sure that they get processed and, and export it, which of course for, for a smallholder of farmer, like the ones we're serving Right, will have a few acres only. Yeah. That is, that is sort of a, an impossible. But the comparatives, make sure that right, all these small farmers together actually become quite a, quite a powerful force that can actually play on the export market internationally.

[00:11:15] Wendy: And are there cooperatives specific to one type of crop or one type of produce, like a coffee cooperative or?

You

[00:11:21] Bram: yeah.

[00:11:22] Wendy: lettuce Cooperative

[00:11:24] Bram: Exactly. I'm inclined to say that they tend to be regional and in that region, a certain number of crops grow. So they can be multi crop, but not all the crops. Right. And they tend to be multi crop, but crops that do well in that region. So let's say that if you're a coffee comparative, you may also be good at doing potatoes, vanilla and, and ka.

If you are a soya comparative, you may also be doing a well at sunflowers and sesame and maybe some maze. So that sort of grouped in terms of right, what grows well in, in which region and what works well for, for which crop.

[00:11:58] Wendy: Got it. That makes sense. Thanks for explaining it to me. Why don't farmers just go to banks to get.

[00:12:02] Lillian: Well, for a number of reasons. banks at least here in Africa have processes that are bit time consuming and also costly to the farmer. Number one, they need collateral. They need a bit of paperwork. Most farmers are Same illiterate or illiterate? And most times because their processes are time consuming, Farmers don't get the funding they need on in time for the season.

And that's a great risk because one of the farmers we actually talked to earlier this year, they had to miss to plant another crop altogether because, they didn't get the funding they needed to plant what they wanted, so they just winged it for that season. And then the other thing is that the farmers, especially for smallholder farmers, the loan amount they want is usually small and, but conventional banks spend way so much too much money to go to these rural areas and reach to the farmer at the last mile that it doesn't make business sense for them or they just don't want to do the work that that team work to get to the rural area.

So most times, You'll find that rural Africa is highly unbanked. Farmers will not travel to go to the bank. Even there's a stigma just entering the banking hall for some of these farmers. It's just the larger farmers that can get access to the bank loans.

[00:13:31] Wendy: That makes sense. What is the average size of a loan that a farmer gets from Emata?

[00:13:36] Lillian: The average size is currently $360.

[00:13:41] Wendy: Wow. And what is the interest rate that you guys put on it?

[00:13:44] Bram: So our interest rates at the moment vary between three and four and a half percent. So for listeners, in the rich world, That sounds absolutely insane, right? Because you may pay four and a half percent per year yourself as opposed to per month. But this needs to be put in context.

So if you were to get a loan from a bank you would pay roughly two and a half percent. So we're slightly more expensive than the banks, and that is for a number of reasons that Lillian just explained. But the main one is that these loans are very, very small and, and, and, right. For small loans, you typically can't use a bank.

So these farmers are used to use other sources before Emata came, which are either community banks that are located in rural areas, or these are long shark. And both of them are problematic. The rural community banks are essentially there to solve the problem that we are solving, right? These are community banks in villages that lend to farmers.

They, they lend to farmers at around four to 5%. So slightly more expensive than we are. But that model doesn't really work, and it doesn't really work for, for a very simple reason that these community banks, they get their funding, right? So the money they have to lend out from the local community through savings and, and to buying shares.

Sort of economics one on one teach you that in most countries, the capital resides in the capital city, right? There may even be a reason why capital is called after the capital city and not in rural areas, and the money tends to, to move from the capital to the rural areas, which is something these these communal banks fail to do.

That's why often when farmers want a loan and they go to the bank, the communal bank simply is closed. They may let you in for repaying your loan, but they will not give you another loan because simply they do not have the capital. And you can imagine, right, if if the whole community there does a certain type of farming, they all need the money at the same time, right?

To all buy the seeds at the same time, which is something that these communal banks unfortunately aren't set up for. Meaning that most farmers have no other option than going to the money lender. The money lender has a few advantages, right? They're fast. They will not ask for collateral necessarily, but they are insanely expensive.

They tend to charge easily 10, 15, 20% per month. We have even heard higher. Now, of course, if you annualize that right, it's, it's an absurd amount. Over 200% per year. And shockingly farmers still use this. In fact, when we bring Emata to a new region, this is typically the, the source of lending that, that we're replacing.

But you can imagine there is no sane economic decision you can make in the world that that gives you a profit if you're, if you're borrowing money at over 200% per year. So farmers mainly use the money lenders for emergencies and indeed when it's time to, to prepare their land for the next season.

They just make do with what they have, right? Which is the seeds from last year or borrowing a little bit, from the neighbors. But that's never enough to cover all the land that they have. It's never enough to re put some proper seeds into the soil that's never enough to use the fertilizer that's recommended, et cetera, et cetera.

So yes, right. Our interest rates may sound high to some people in the audience, but anybody knowing Africa a little bit knows that these are actually For these farmers quite attractive interest rates that actually allow them to make a very good return on on their farming activities.

[00:16:56] Wendy: That sounds great. So I have a question. Have you had any issues with loan sharks since you're kind of moving into their territory?

[00:17:03] Bram: I, I wouldn't say personally but we, as, as Lillian explained, we, we work with cooperatives and the comparative consists of a board and we have had cooperatives that have lone sharks in their board. So, we could easily tell that the whole team of the comparative wanted to work with us was ready to sign.

And there was one guy on the board who kept on coming up with the most absurd excuses and reasons only for us to, to be pulled out of the meeting and then be whispered in our ears. But this is, this is a lone shark, so he's not

happy with you coming, but, you know, just, just let us solve this. Give us a few weeks.

So in that sense, we have encountered them, but thankfully not, not on the street,

[00:17:41] Wendy: Ha. Okay. how do you convince people to switch from the old ways of doing things to this new way of borrowing.

[00:17:49] Bram: Yeah, that, that's a beautiful way of phrasing it because we're actually using some very old ways to reach these

farmers. One of the main challenges still is in rural, rural Africa is indeed, Connectivity. People talk about leapfrogging, but trust me, nine out of 10 farmers, at least in Uganda, does not have a smartphone and does not use it in a way that maybe you would imagine why you hear leapfrogging.

So it is difficult to reach them and we use rudimentary tools to reach them, which means SMS and radio SMS and radio. And it was very interesting because we, we send SMSs. So every time when a farmer delivers the produce, our system sends an SMS confirming that, which is really useful. Because typically the farmer is too busy to bring the produce themselves, so they send somebody to bring it.

And, and let's say that if, if the, the person in the morning leaves the farm with let's say 50 liters of milk, very often, it's not 50 liters of milk that's arriving at the cooperative right? It's 45 liters and the five liters. Went somewhere along the road. And initially when our system started sending SMSs, it actually confused the farmers.

Farmers didn't know, What is this, Emata what are you guys doing? But, but they, they have actually come to appreciate the SMSs to the point where they start complaining when they no longer reach the SMSs. So for us, yeah, we, we use old school tools, SMS and radio, but they're, they're, they're old, but they're still very, very powerful.

[00:19:10] Wendy: That's great.

[00:19:12] Lillian: Yeah, maybe just to add onto that. When farmers receive these SMSs, they do not request the loans themselves because they go to the cooperative regularly and the cooperative administrator has a smartphone and WhatsApp, they, comparative administrator, helps them request for a loan on their behalf. It's quite an easy process.

An average of five minutes process for them to both request and receive the loan amount on their mobile money account using their. Uh, WhatsApp channel and they receive it on their feature phone in just a couple of minutes. So that's one of our selling points. We don't need collateral either. There's no hidden costs apart from interest rate.

So farmers like us because of, we get the loans on time for the season when they need it. They don't need collateral. Our process is quite simple and fast. In five minutes, they're able to move from registration, which is KYC processes, to the loan request to the amount dispersed to the Farmer's mobile money phone. And there's no hidden costs. There's easy access for the farmer because our agent or the person at the CO is close to their location or close to their village. And while the payment is easy, like Bra explained, all they have to do is continue to deliver. They harvest to the CO and that will allow them to pay back their loan.

So it's, it's, those are our, Selling points, but it's not very hard to convince farmers. Most of them once they get the sms because of who we have to compete with, the launch sharks, they're already asking how and when can I get this? Yeah.

[00:21:03] Wendy: That's great. And how high is your repayment rate?

[00:21:06] Lillian: Currently, 95%.

[00:21:09] Wendy: that's amazing. That's so great. So I wanted to zoom out a little bit and talk about some of the knowledge that you guys probably have just from studying agriculture in Africa for so long. So maybe you can kind of fill in the bigger picture. What are some of the current challenges for farmers in Africa?

Or if it's easier just to talk about the ones in Uganda, but like what are some of the current challenges that they.

[00:21:32] Lillian: I'll talk about some few then maybe bra more. Add to it. There is a classical ones climate change. Of course. Farmers need to now become more climate resilient and that means they need funding. Which leads me to the second challenge. Access to finance is also a huge thing. Like, you know, most conventional ways of accessing finance out there in the world are not working out of the box in rural Africa. So that's a huge challenge and that's majorly why we are solving for this. And creating partnerships with insurance companies to talk. Those two I live around to talk about the rest. But for me, off the top of my head, those are the biggest. Challenges we're facing.

[00:22:21] Bram: Yeah. So if, if indeed we zoom out we, we, we sometimes like to think that Asia is most likely gonna stay the factory of the world. Right. It's unlike Africa ever becomes a massive manufacturing power in the classical way.

[00:22:38] Lillian: Hmm.

[00:22:39] Bram: Development, economic development was supposed to be from agriculture to manufacturing, to services.

But we, we really believe that Africa has a massive role to play in the world when it comes to the, the agriculture produce that it has left, right? And, and, and all the facts are supporting this in terms of what most Ugandans and Africans do, but also in terms of where is the most unused airable land bank, where can yields still go up, et cetera, et cetera.

This means that in principle, agriculture is a very attractive profession in Uganda. And in fact more than half of the people retiring in, in, in, in Uganda, they would say, Great, now I can go and farm. Right? This is sort of a, an ideal picture. If you retire, you go and farm. So there is a huge appeal to agriculture, which is great cause the world needs it.

But how is it to be a farmer? Not one who's retired or has their money saved, but what is it actually like to be a farmer? And then the biggest challenge is, right, can you actually like any other company? Invest in your farm and make sure that today this is what you do, right?

You've maybe gotten a small plot of land for your parents, right? Great, but where are you gonna be five years from now, 10 years from now, 30 years from now? Right. Is this a business that's attractive, is a business where, right, you can provide for your family and have a good life? Or is this an eternal struggle from poor harvest to poor harvest, to poor harvest, to no savings, to no.

Et cetera. And, and that is essentially what we're solving, right? We make sure that farmers can finally invest in their farms and turn their farm into something very interesting. If you, if you zoom out and, and look across the world how agriculture has developed, whether we like it or not, there is something that has to do with economies of scale that the best farmers have been able to invest year after year and grow their farm year after year.

And where maybe they were a small farm in the beginning, right? They now have a farming enterprise where, right, they have a lot of land, diversified their crops, maybe do some little bit of processing, some value add. This never happened in, in Uganda and I think in Africa in general because even though you may have been a very talented, capable farmer, you never had the money at your disposal to keep on growing and to keep on investing, which is what's normally happening in, in, in, in any sector, right?

That's why people always say that as a means are the engine of an economy, because there are a few small firms out there, some of them are not going anywhere, right? They're just small and pop shops on the store. But some of them, they're good. They have this thing. They keep on growing and it turned out to be a very interesting larger companies that, that go out and, and employ a lot. And so I think essentially that is what we're making sure that a farmer who may has four acres of land today and historically speaking, has only been able to invest in half an acre, can now suddenly plant two acres with alone, and in the next season, three acres and the next season, four acres. And then his land is done and he starts.

Renting land next door. And maybe when he has done that a few times he start buying land. Right? And who does he rent the land from? Or who is he buying the land from? Well from neighboring farmers who are not as good as him. So we are sort of making sure that that natural process that you normally see where sort of the good farmers start thriving and they start growing is finally taking place.

Cause whether we like it or not, that requires capital and that capital has not been available. Cause it's very difficult to make sure that that capital reaches right. Rural Africa, deep rural Africa, e. And that's the one that we're solving. So essentially that's why we're saying that, right? We make sure that farmers can, can invest in their farm and turn it into a, into a business and a, and a productive future.

[00:26:03] Wendy: That's really cool. You are really contributing to the whole farmer ecosystem from an individual farmer level, but really helping them, strive to, become bigger and more efficient and more productive and things like that. Africa is such a huge continent.

I'm sure you're planning on scaling, so what does that plan look?

[00:26:20] Bram: If, if, if we say we wouldn't, then of course we have a problem with our investors. So no ob obviously we plan on scaling this. Unlike maybe the United States or NAFTA as a region or, or European Union Africa is still very fragmented in terms of jurisdictions, in terms of regulations. So it's not that easy.

So for us, we have our eyes set on East Africa, which is the region where Uganda is located and, and that we know quite well and where there's a lot of trade happening, a lot of, a lot of exchange. So in terms of climate, in terms of crops, in terms of how people do business, in terms of how people identify themselves, there are a lot of commonalities.

So we we're very keen to be expanding across the East African region. Those discussions have started years back, so we're just waiting for the right time when we feel right, our company is strong enough to actually right start going across the border because of course it has a massive impact on any company going internationally, So for us, we we're eyeing East Africa as the region. That's interesting for us. Now, that doesn't mean that this is not a wider problem. This doesn't mean that. You know, Central Africa or West Africa doesn't have the same problem or, or put differently Latin America or Asia. And in fact, I kid you not, we're actually getting a request from those regions saying, Hey, this is really interesting what you're doing and your technology.

Can we, can we use it? So for us, if, if we're talking long term, right? East Africa is where we have our eyes on for the coming five. But we do not exclude the fact that our technology may start helping farmers and people in other parts of the world, but it will probably be to a slightly different model.

I don't emphasize us setting up physical offices and people on the ground. But of course nowadays that that is no longer required. So I do see us up partnering with larger organizations elsewhere in the world where we give them access to our technology. We may even run it for them but I don't see us necessarily building up a physical presence or getting licenses all across the world.

[00:28:15] Wendy: That makes sense. So what are your one year goals? What do your five year goals look?

[00:28:18] Bram: Excellent. So we, we launched our product in 2021 and we launched the dairy sector, which is the largest vertical within agriculture in East Africa. It's absolutely massive. To give you an idea, the Ugandan economy is, is only. 25 to 30 billion each year. Which, which, which, you know, Quite modest, but dairy alone is more than 2 billion in that.

So it's, it's an absolute massive industry in Uganda. And in fact it is across the East Africa. So we started in dairy in 2021. And for this year, 2022, we set out, okay, let's. Let's expand and see if our model also works in crops. So while this year we scaled up our dairy to a new level, we started experimenting in crops.

So we launched in May and February. We launched in Sunflower, soya and sesame in July, and we launched in coffee in October. Now some of these crops and these verticals are working really well for us. Others

less.

[00:29:12] Lillian: Yeah.

[00:29:13] Bram: Now looking at next year we'll probably scale up those verticals that work well for us and we're gonna add a few other verticals to see if they, they can also work for us.

So next year will be a mix of, Okay, let's run a few more experience. Right? Let's maybe see if potatoes can work for us. Let's maybe see if Rice can work for us. Let's maybe see if Kacal can work for us while also scaling up. The verticals that do work well for us in. Now we have quite some experience of scaling up dairy, but scaling our crops is slightly different.

For crops, the moments the rain comes, there is a perfect window in which all the farmers want to plant. Meaning there is a one to two week period in which all the farmers want to make sure they get their loan so they can, right, they can buy the seating, buy a fertilizer, they can get going. So we have build the product around how that could work.

But we have no illusion. That, that will go, you know, perfectly well in one go. So it'll be continuing to run experiments to find out which value chains work well for us. And at the same, same time making sure that we can serve thousands and thousands of farmers, you know, in the same month, in the same week, and ultimately in the same day.

Cause there's that perfect window that farmers went around for and we wanna make sure that, that that can happen.

[00:30:25] Wendy: That sounds like a really stressful couple of weeks for you guys.

[00:30:29] Bram: Ah, those are fun weeks. Those are fun

weeks. Um,

[00:30:31] Lillian: difference, it's what

happens.

[00:30:32] Bram: like a planting campaign. Yes, it's a bit stressful but ultimately right. That that's what we do it for. So yeah, they, they're long days. But they're, they're very rewarding days.

[00:30:43] Wendy: What are some of the biggest challenges that you all have faced with starting this company and operating this company?

[00:30:49] Lillian: Well, I'll speak for the product side. Connectivity. in stop of my list. Um, Well, when we started out, we had all these ideas from digitizing banks and we wanted to do like flawless digital systems. But we quickly learned, uh, we had to go back to the drawing board and develop something that works in a rural setting.

So, the system that sits at the core is actually offline fast, so they can work offline and only connect to, uh, backup so we can receive the data for credit scoring. That's how we solved that. But in the. It was quite the hustle. Uh, it's also part of our onboarding now that when we do due diligence, we check connectivity, which network works best, and basically find our ways around that because we need to digitize this for us to be able to, um, analyze this data and create credit scores for every farmer.

[00:31:54] Bram: I'm, I'm not sure if there are any techies listening. Uh, but yeah, we are, we're dealing with computers, um, that still run on Windows 98.

[00:32:04] Lillian: Exactly.

[00:32:06] Bram: Right. We have developers in our, in our company that weren't born when Windows 98 was released. And here we go, right? These are very smart guys making amazing code.

And then system says no, because it doesn't run, doesn't run on Windows 98. Uh, so indeed, as much as we are a very high tech company, we have to operate in a very low tech environment. So that was quite the journey to sort of find the right balance. Um, how do we blend all the things that we know technology can do to, how can we deliver this in a rural setting where you have to make ends meet with basic phones, ancient operating systems, no memory available, um, and almost no connectivity.

Um, Right. There are quite some startups out there in Africa active, and they always say, Yeah, but we're fully in the cloud. And Lynn and I, we just have to laugh like, Oh, you're in the cloud, , good luck, . Uh, yeah, wait, uh, wait, wait until it starts raining, and then the connectivity will literally drop. So that's, that's definitely been a massive one.

But, but we, we, we've come really, really far, um, because we, we sort of tackled that head on and just realized, Let's dilute our technology on, on the front end, right? In, in rural areas to make sure that it becomes insanely robust and maybe then right at a price of being a little bit less fancy. Um, the other thing that I think is, has been a challenge for us, um, has to do with.

Which value chains worked well for us? So we, we, we went into a different value chains, as I explained earlier, right? We went into maze, we went into Sunflower Soya coffee, um, and the list will get longer and longer. And it was quite clear from the beginning that some value chains work really well for us and others don't.

Uh, and we believe that has to do with the setup of the value. So we as iata, right, we reach the farmers ultimately by going through, um, through partners with comparatives. Um, and the strength of our partners is very important for how successful we are in a value chain. But we actually believe there's a correlation between how organized a value chain is and how strong the partners are.

Right. So that takes milk for example, right? If you do not deliver milk into a milk cooler quite soon, in a tropical setting of Africa, right, where the temperatures can easily be 30, 40 degrees, that milk is not gonna be good for very long. Right? Meaning that people just need to sell to somebody who's a little bit organized and has a milk cooler If you are a coffee farmer, right?

It's very unlikely that you yourself are gonna put that in an envelope and send those coffee beans to the US to make sure. It reaches Starbucks, right? Meaning that you have to work with people who, who can make sure that right, they treat the beans. And make sure they're efficiently exported. Um, but it is different for other value chains.

If you're grow a crop, uh, let's say, let's say maze that you can sell yourself because everybody eats it, your neighbors, the market. Um, right. How strong is that partner who is in that value chain? Um, so the other is on the challenges that, that we had to learn to deal with this year and become more aware of like, okay, good, right.

Our model works really, really well. The results we're getting are, are, are quite mind blowing to be honest. Uh, but we cannot replicate this everywhere. Are there enough value chains where this works for us? Absolutely. Is that a huge market that, that that runs into tens of billions of dollars, uh, in, in these African region where we're active?

Absolutely. But will, we will deliver this to everyone. We will deliver this to every chicken farmer, mace, farmer, or, or tomato. You know, uh, our model is not, um, one that works for all the value chains. So that's, that's another challenge, um, that, that we run into this year.

[00:35:45] Wendy: Wow. Well, it sounds like you are becoming quite the expert on farming. I mean, it sounds like you guys were already quite the experts, especially Lillian, growing up in a place that 80% of the occupations are in agriculture. What is the future of agriculture and what does the future of agriculture look like in Africa?

[00:36:02] Bram: Yeah. So if you look at agriculture today, right, um, it is not hard to argue that the system is broken for a number of reasons. And if you zoom out a lot, if you ask me, one of the main problems with agriculture is that the, the cycle or the circle, if you will, is no longer. So way back when, right? People did everything on their own farm, right?

They had their own livestock, they had their own crops, and the livestock was producing the fertilizer, uh, for the crops. And then the crops was again, the feed for the cow. And the system was, I balanced, right? Because the nutrients. We're in a circle. Now, if you look at the value chain of agriculture today, that is absolutely broken, right?

Uh, we have massive herds of livestock somewhere in the world where that's not even grass growing. They're being fed on soya that comes from Brazil, where they have to chop, operate the rainforest to get it. They have to ship that soya there. Now, all these cows, of course, they produce manure, which they cannot use there cause nothing is growing where these cows are.

And the system is broken and, and the flow of nutrients is not. Now I, I shared earlier that Africa has tremendous potential from an agricultural perspective. But the sad reality today is that Africa is actually a net food importer, which is absolutely wrong, right? There is absolutely no reason why Africa should be a food importer.

In fact, Africa should be a food exporter, no doubt about it. Um, so currently Africa is contributing to this broken system where right food is not produced and made in the place. It is being consumed. if we have learned anything from these past years of crisis is. Yes, it is amazing to have super efficient value chains and distribute everything across the world, but it also creates huge vulnerabilities, whether it's in our factories and manufacturing in China, or whether it's indeed our food dependency where we're so dependent, especially in Africa, our food produced, and for example, Russia and Ukraine.

So if you ask me, there will be super exciting tech driven developments, uh, all across the agricultural industry, all across the world. But for Africa specifically, right? They need to make sure that they become food independent and make sure that they start producing enough food themselves. Um, and the solution that is very simple, right?

Make sure that farmers invest in their farms, make sure that they use better inputs. Uh, make sure that the, the, the value chain becomes stronger. Hopefully true comparatives, a proven model all across the world, right? Comparatives, internationally speaking, are some of the largest companies in the world. Um, and that on its own will already contribute, um, quite a substantial bit.

To getting the world a little bit back into balance and making sure that we stop some of these insane things where we're sort of importing soyer from the one end of the world. And then, you know, export the cow down probably and under the world. And we just create problem after problem as opposed to solving things, uh, locally originally when it comes to, uh, growing our food.

[00:38:57] Wendy: Yeah, I agree with you. I think the, I've never heard it. Flow of nutrients. But I think it's such a, such a interesting way to put it because in like America right now, everyone's talking about regenerative agriculture, you know, like soil health, things like that. But it really does come down to the fact that yes, to your point, everything used to kind of be on site.

You had the whole ecosystem kind of working with itself, and now everything is so disparate. So yeah, I think it's a really, really good point that you just, Um, is there anything else you'd like to add? And can you tell the audience how to learn more, how to follow you guys, how to keep an eye on what you all are doing.

[00:39:36] Bram: Lillian, you're a social media guru today. What

[00:39:41] Lillian: Oh my. Well,

, our audience can reach us on or u and on Twitter, that is at Ima. Um, and then they can also reach us on LinkedIn. Very active on LinkedIn. Uh, all you have to do is search for Uganda and.

[00:40:07] Wendy: Wonderful. Well thank you to so much. I learned so much about just the ecosystem of farming and agriculture in Africa and the wonderful things you all are doing. Best of luck with Ima. It's a fascinating company and you're helping so many people at such a great scale, so congratulations on that and I will look forward to following you into the future. Thank you again for being on the podcast. I really, really enjoyed it.

[00:40:31] Bram: It was great being

[00:40:32] Lillian: Thank you when they.