Hi 🙌 This is the first in this newsletter where I talk about how I ended up here, what agri-Fintech is and why it is important. Let's dive in.
In the late 2000’s I started to attend ‘Tech’ networking events in the trendy Shoreditch area of London. I certainly wasn’t trendy, but the area was! ‘Tech’ was undergoing an exciting unbundling and I think that was when sub domains started to arrive such as AdTech, FinTech, HealthTech.
This was actually my first encounter with Agtech, believe it or not, as someone introduced themselves as developing ‘EggTech’. EggTech? what on earth was that? It turned out it was me mishearing EdTech, but the image of some sort of social network for eggs or chickens never left my mind. (Free business idea there for someone! It's all yours).
My own chosen subdomain was FinTech. I was running a fledgling start up called Blue FX which was akin to an early stage Transferwise or Revolut, which arranged currency payments for small and medium businesses.
I loved it as I was:
➡️ dealing with real businesses;
➡️ solving problems; and
➡️ democratised access to finance for smaller businesses.
It turned out Blue FX was actually a Not-for-Profit. It wasn't meant to be - it just didn't make any profit!
Some grunt work later and I was again noticing one theme consistently on my radar - mobile enabled financial services in developing countries and the link to agriculture. This was more like it:
✅ Real world Problems (Hunger!)
✅ Real world Solutions (No social networks for chickens 🐓)
✅ Democratise access to Finance (Everyone wants more $$)
But it was in agriculture – did I really want to get involved? I grew up on a farm in Ireland and sadly knew the blood, sweat and tears that came with it.
On the other hand it is a LARGE industry - 4% of global GDP. Compare that to Construction, which is about 10% and extremely visible. Demographics are very favourable and everyone has to eat - so I took a peak.
Some work for an agribusiness in Southern Africa, an Agri-Fintech start up, an Agricultural Commodity Exchange (also Agri-fintech) and numerous projects later, I am here writing this blog. (I have some other exciting stuff in the pipeline, but lets discuss that later. )
But why write it?
Financial services is undergoing a huge transformation. To put it very simply, traditional finance was built for the industrial age 🏭 and this is reflected in financial products and user experience. It is top down and rigid.
Applying for a product looks and feels like this 👇
This digital revolution has swept change in Agriculture also. Agronomy can be delivered by smartphone 📲. Satellite imagery allows 10m x 10m pixels of land to be viewed from a tablet. Sensors can monitor soil health and water from anywhere in the world 🌏. Records can now be stored on your phone. Think about that 🤯
It is my prediction that the global funding gap for Agriculture will be filled not by existing products - it will be filled by embedded financial products developed using APIs from platforms like Leaf (US, Brazil), Bushel (US), Pinduoduo (China) or DeHaat (India).
These products will be user centric and built from the ground up rather than being top down. That is why agri-fintech is important.
That embedded journey will look something like this - which is producer orientated but you could actually map financial services across any point in the value chain.
What does the Landscape look like?
The landscape is frankly huge! But I have attempted a start at this which is below (you may have seen on Twitter @niallhaughey).
Over time and through this Newsletter I will update this and customise it - we could deep dive into marketplaces, examine precision ag's impact on finance, list all the ag-insurtech's, break it ALL down by country and we still won't be finished. What would you like me to look at?
Want to hear more?
My objective is to write a newsletter that outlines how Agri-Fintech:
1️⃣ Impacts Financing for agriculture everywhere;
2️⃣ Democratises access to financial products;
3️⃣ Accelerates sustainable (financially and ecologically!) climate smart Agriculture.
.... and all within the realm of a discussion on data, blockchain, platforms, payments, AI and importantly ... you.
Please hold me accountable, give open feedback by telling me what you want covered (or what I can improve) and subscribe!
In my next issue, I want to discuss Fintech, generally, and why it works (shiny apps are only a part of it!) and how this can change Agri Finance at a high level.
Will I see you then?