Sara Menker Founder and CEO, Gro Ventures December 4, 2013 www.gro-ventures.com

1. Big Data as a Tool for
Financing African Farmers:
Data-Driven Lending
Sara Menker
Founder and CEO, Gro Ventures
December 4, 2013
www.gro-ventures.com
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2. The Future of Agriculture
• By 2050, there will be over 9 billion people in the world. In
order to feed everyone, overall food production will have to
grow by 70%
• With more than half of the world’s total share of uncultivated,
arable land, Africa not only has the potential to feed itself, but
to help feed the world
• In order to capture this potential, the African agricultural
sector will require significant investment in order to address
the considerable challenges and inefficiencies that are
currently stagnating the industry
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3. The Anatomy of the African
Farmer
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5. Inputs Expensive
Without access to reasonably-priced loans and the protection
offered by crop insurance (insured farmers in the continent
number in the tens of thousands), farmers cannot afford
yield-enhancing agricultural inputs.
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10. Value Addition Difficult
With low yields and expensive capital, agricultural processing
and any type of significant value addition becomes difficult
and costly.
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13. Explaining Expensive Capital
Insufficient data
Risk aversion
High Cost of
capital and
services
The only way to capture the upside of African agriculture is
through timely and reliable data
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14. Data as Infrastructure
Gro Intelligence is Africa’s first privately funded agricultural big data
company.
• Gro is an agricultural supercomputing platform that allows us to
drastically increase the amount of timely and reliable data on
African agriculture.
• In addition to using data from various sources, Gro will collect
data independently, using phone-equipped farmers to become
human sensors.
• Farmers have the most valuable information about agriculture in
Africa.
• Farmer based organizations throughout Africa will be key
partners for Gro Intelligence so that products designed are
relevant and needed by the farmer.
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15. Focus on: Banks
Financial
Sector
Banks
Insurance
Companies
Investment
Funds
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The lack of agricultural data and effective
financial tools has kept the role of banks in African
agriculture minimal:
Less than 1% of outstanding African loans
are to agriculture, despite the fact that the
sector contributes more than 32% of
continental GDP
Gro Intelligence provides banks with the reliable
data and powerful tools they need in to capture
the massive untapped opportunities in lending
into African agricultural markets
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16. Data-Driven Lending
Gro Intelligence is creating a new wave of data driven credit models to
enable large financial institutions in Africa to lend effectively.
• Access to capital is not enough for farmers. The capital has to
come at a cost that is cheap enough to enable farmers to
compete in global markets
• To make capital cheap, we need to embed fundamental realities
of various crops into credit models so that banks have an
understanding of agricultural markets
• Initial market is East Africa in collaboration with farmer based
organizations, that will be the recipient of loans for shared
mechanization equipment.
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17. Impact of Agricultural Supercomputing
Impact on Global Businesses:
•
With better data, banks will be better able to effectively allocate capital and loans to
the sector
•
Insurance companies can use data to create crop insurance products
•
With improved ability to source agricultural inputs, processing plants will run at
higher capacities
•
Logistical operators can build out significantly with information about demand
•
Seed and fertilizer companies can improve distribution plans and create seed
varietals
•
Trading companies and food conglomerates will get a more complete assessment of
African supply and demand, enabling them to make better trading decisions and
increase volumes
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18. Impact of Agricultural Supercomputing
Impact on Policymakers:
• With up to date information on market activity and transportation
and infrastructure needs, policymakers will be better equipped to
create and fulfill immediate policy objectives
• In the long term, policymakers will be able to prioritize investments
and policy initiatives to ensure long term growth
• Policymakers will be better equipped to manage grain reserves that
are used during production shortfalls and market disruptions
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19. Impact of Agricultural Supercomputing
Impact on Individual farmers:
• Agricultural and banking services will become cheaper and more
accessible
• Infrastructure improvements will begin to address fragmentation
challenges
• Access to market information will help farmers better strategize what
to grow and where and when to sell products
• Improved education will enable farmers to reduce agricultural waste
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20. Africa Feeds the World
Timely and reliable
agricultural data
Informed decisions
by financial
institutions,
businesses, farmers,
and policymakers
Increased access to
capital and services
for farmers
Africa feeds
the world
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