Our solution's stage of development:Growth
Smallholder farmers in Africa - and especially female farmers - see most of the value of their crop disappear over the 'farm gate' when they sell it to middlemen. TruTrade uses a smart digital platform to transform this relationship.
Smallholder farmers in Africa are starved for liquidity, so they need to sell their crop at harvest. The farmgate traders who take advantage of this are also cash poor - they can only buy a limited amount of crop at a time.
TruTrade gets middlemen working for farmers by providing them with trading finance, in return for a fixed commission. Farmers not only get a better price for their crop but they also receive payment for it, via mobile money, as they sell it, and they get complete transparency on the deal, so they know how much each step costs.
Why our solution will solve the problem:
Making markets work for the poor requires lateral thinking. For so long, the middlemen traders were identified as the profit-takers from poor smallholder farmers. But they provide an essential service to these farmers - a route to market. Women are especially disadvantaged as they are more likely to lack access to transport, storage and finance.
By building a platform that meets the needs of both the middlemen and the farmers, we have identified the sweet spot. In recent avocado trades in Kenya, for example, we have more than doubled prices paid to farmers.
Our target outcomes:
Smallholder farmers - especially female farmers - are the targets for this solution. The beauty of the TruTrade solution is that it is eminently scalable - what works in agricultural value chains in Uganda and Kenya can work anywhere else in Africa, or indeed around the world, where the same challenges exist.
Deploying TruTrade's solution to farmers requires us to identify and mentor trusted 'value chain players' - these are traders and agri-processors who work with TruTrade to maximize farmer income. Identifying these actors is the key to scaling the initiative.
How we will measure our progress:
The populations we will benefit initially:
The regions we will benefit initially:
The technologies we employ:
Why our solution is unique:
We are using the increased penetration of both mobile phone use and mobile payments in sub Saharan Africa, together with the lower cost of digital development, to build a smart platform for matching farmers to markets.
Technology is the key to this effort; the entities providing finance to these value chains would not do so without the very clear identification not only of the ultimate 'consumer' (very often, a non-African import destination or an African-based processing company) but also the full visibility across the chain, right down to tracking individual payments to individual farmers.
Why our solution is human-centered:
This technology is designed so that a poor and often semi or fully illiterate farmer in Africa can use it. The system breaks the market down into cost centers, so that farmers can see how much their crop receives at the top of the market and how much each actor - including the farmer - receives for it. This information empowers the farmer before she sells. Connecting isolated farmers into global supply chains is the ultimate empowerment.
How people will access our solution:
People will access this solution because TruTrade identifies a 'value chain player' - which can be a private trader or processor or indeed a farmer cooperative - and establishes a relationship with that player. TruTrade provides trade finance and a platform that allows for payment and traceability right through to the producer.
TruTrade is a social enterprise; its focus is to drive profitability for farmers, not for TruTrade, so we make the solution as affordable for these farmers as our business model allows.
Technology-Readiness Level:9 (Commercial)
How we will sustain our team financially:
TruTrade is majority owned by Self Help Africa (SHA), a US-based non-profit that works with smallholder farmers across Africa.
SHA continues to finance the development of the TruTrade initiative - and is committed to it - but needs other partners to help us achieve scale. These partners can be offered equity in return for their investment.
As it stands, TruTrade is working and has a clear runway to breakeven. However, achieving scale requires investment that SHA cannot make.
The factors limiting our success:
TruTrade needs additional investment to expand beyond its current work in Kenya and Uganda. This is both investment in its own service delivery and investment in trading finance (which can deliver fixed returns to investors).
TruTrade thrives in environments where large numbers of farmers have adopted mobile money, or can be convinced to do so in the near future.
How long we have been working on our solution:3 years
How long it will take to develop a pilot:We have already developed a pilot.
How long it will take to scale beyond our pilot:We have already scaled beyond pilot.
Our expected annual budget:
How much of our budget we've secured to date:
We're looking for partners in these fields:
Why we're applying to Solve:
By bringing TruTrade's success in adapting markets for the poor to a wider audience, we hope to help it scale - either through increased financing or by inspiring others to replicate or model.
Our current partners:
Self Help Africa, a US and European registered non-profit, is our majority shareholder;
A number of other African and European-based individuals who work in agricultural development are minority shareholders.
TruTrade receives some grant assistance from Mercy Corps and Trocaire (both non-profits) and is soliciting funding/investment from a variety of actors.
- Will Galvin Chairman, TruTrade