The Next Generation of Agritech: Key takeaways from the MEST Africa Summit 2019

Lundie Strom, MEST Africa Community Manager, Friday July 19th 2019

From June 10-12, 2019, MEST Africa hosted its annual Pan-African tech conference, the MEST Africa Summit, in Nairobi, Kenya. The Summit brought together top entrepreneurs, investors, executives and ecosystem players from across the globe to explore and discuss the latest in African tech.

Over the course of two days, seven panels invited industry experts on stage to engage with topics including the investors' perspective, data’s influence on the ‘new credit score,’ and which African country is the best home for a startup. Ashwin Ravichandran, MEST Africa Managing Director, facilitated the panel titled ‘Next Generation Agritech: The future of one of Africa’s most prolific sectors,’ to help Summit attendees dive deeper into one of the fastest-growing fields on the continent (no pun intended).

To begin, Ashwin asked panelists to comment on the talent aspect of the agritech value chain, from engaging youth potential to using current talent to help pass on knowledge and skills.

“Talent is one of the top bottlenecks in Kenyan agriculture right now,” said Grant Brooke (Executive Director, Twiga Foods). “We have the land and finances, but we need to work to create the would-be farmers who can manage and bring the land to production. We need to build more finishing schools and get more universities to prepare people for the marketplace in order to close the talent gap.” 

Faith S Kaoma (International Research Action Manager, Restless Development), who works to bring Ugandan youth into the industry, said, “A lot of youth experience difficulty uptaking the agricultural technology. Young people in rural areas have limited access to technology such as social media to help them learn, so they’ll learn from their peers or champions in the community instead. Peer to peer models have worked for us.”

When asked about some of the challenges of designing agritech systems and processes from a human-centric perspective, Tosh Juma (Managing Director, Nairobi, said, “A lot of innovators design solutions for one end of the value chain or another, but rarely think about how they connect to each other. We have to think about what a farmer wants, what a vendor wants, and everything in the middle, and address all of that.”

But in order to get started, how do young entrepreneurs in the agricultural industry access the necessary funding? And once they do, how do they use it to scale successfully? 

Kwaku Owusu-Achaw (Business Development Advisor, Shell Foundation) stated, “At fundraising events you often find incredible entrepreneurs seeking funding, but investors only looking to give it from Series B onwards. There is not a lot of Series A funding in Agritech. We need to find a way to find more funding in the pre-seed and seed stages to provide that capital early on.”

“Venture capital requires compounding growth, which agriculture doesn’t generally do very well,” Grant added. “I see a lot of startups who are not venture-backable companies trying to access finance within the agricultural sector, where the only capital tools are venture tools. Right now only 1.5% of consumer finance in Kenya goes into agriculture, even though it makes up 30% of the GDP and 60% of employment. This is not the entrepreneur’s problem. It’s a problem incumbent upon investors and financial services to come up with better tools to service the marketplace.”

When asked about how technology such as social media has impacted the traditional value chain, John Kieti (COO, Ashoka) referenced his research. He's found that the number of people using new technologies to succeed in agriculture is growing consistently.

“There has been a massive increase in various social media activity surrounding agriculture, with some agricultural themed groups growing to 300-400 thousand people. So far I have found that about 84% of the people working in agriculture are actively using social media, especially Facebook, to improve their output,” he said.

And as the African population is expected to grow to 2 billion people by 2030, what does the future of agriculture on the continent look like in terms of designing for scale and productivity?

“One of the best things we can do in terms of designing for scale for at the moment is doing so from a tech literacy perspective,” Tosh said. “The segments that are currently farming are much older, and the adoption of tech is happening more with the youth. We will need to consider productivity by not using the same methods of our grandfathers.”

“For me, the future is in value chain efficiency,” John added. “We need to resolve the tension between optimising for food security and optimising for economic empowerment. At the moment, a lot of production is done inefficiently - so we need to look at what needs to be done to create more efficient producers, logistics providers, and distributors, and have that all informed by data.”

“Crop after crop is going to start being import-dependent if we don’t start looking at our production lines," Grant said in conclusion. "By 2025, when half of our population in Sub-Saharan Africa lives in cities, can we set up a closed loop between the demand of those urban cities, the financial structures to finance farmers, and logistical assets to pair the two together?” 

He concluded on a positive note, “These are solvable problems… and I think we’re going to get them solved.”

The future is bright! Thank you to all of our panelists for their contributions, and we look forward to more insightful conversations at the next MEST Africa Summit.

For more, read the full MEST Africa Summit 2019 recap here.