Unlike informal agents and government or donor-funded extension workers, agent networks are clusters of third-party and often semi-independent micro-entrepreneurs that are organised around the last or middle-mile delivery of a product or service.
Using “agents” to deliver basic agricultural support to farmers is not a new invention.
But these agricultural agents were mostly paid government officers or contract-based employees working as part of time-limited and donor-funded interventions.
Another set of historical agents in Africa have been the loosely organised group of middle-men. These typically informal agents sit along the value-chain and aggregate produce in remote villages, supply input, and facilitate the movement and sale of agricultural produce to collection points and large markets in big cities.
In the last few years, a still newer set of agents have emerged. Drawing inspiration from the large network of semi-independent micro-entrepreneurs who served as a critical interface between digital financial service providers and retail users of products like mobile money, agricultural startups are beginning to lean into building distribution and service grids that coordinate agents to deliver a product or service.
Unlike informal agents and government or donor-funded extension workers, agent networks are clusters of third-party and often semi-independent micro-entrepreneurs that are organised around the last or middle-mile delivery of a product or service.
It didn’t take too long for digital agriculture platforms to realise that selling services to farmers would rely on more than the simple availability of mobile internet and growing mobile subscriber numbers. Low levels of digital literacy, prevailing social norms and lack of trust were too much of a barrier for digital platforms to overcome, Dunstan Adongo, a market engagement manager at the GSM Association (GSMA) wrote.
Agent Networks Are Becoming Cool Again
From consumer-focused startups to farmer-focused companies, agricultural technology companies in Africa as well as donor-funded interventions are turning to these independent agents or to find scale.
Kapu, a consumer e-commerce startup that was created by former Jumia executives, sources fresh produce from Kenyan farms at wholesale prices and delivers them the next day-for free-to the nearest Kapu agent. Sam Chappate, co-founder and chief executive of the Nairobi-based company, says his company is building a dense network of street-level agents in targeted neighbourhoods.
Tawi Fresh, also based in Nairobi, was conceived from a Standard Chartered Bank incubator and focuses on coordinating a network of farmers. It helps the farmers directly supply more than 300 commercial kitchens in the Nairobi area.
In Ethiopia, which is carving a place for itself as an agricultural powerhouse, more than 2,000 agents help Lersha, a multiple-award winning Ethiopian agricultural technology startup, to reach more than 202,000 farmers throughout the country.
Donors and development agencies are getting in on the action. After years and money lost to ineffective interventions were often cornered by a small group of “professional meeting attendees” who according to Backson Mwangi, a Programme Policy Officer at the United Nations’ World Food Program (WFP), often used fake farmer lists to corner resources.
Eventually, the WFP’s Farm to Market Alliance (FtMA) realised that it could reach and serve farmers better by working through a network of farmer service centres and partnering with other agri-tech startups.
For the FtMA, this switch was a break from the initial approach of attempting to build an end-to-end digital platform and later trying to work through so-called Group Leaders. Now it works with agri-tech startups and third-party agents through strategically located farmer service centres.
Agents have always been a vital part of Africa’s agriculture business landscape. Informal agents have long served as travelling aggregators of farm produce or other forms of intermediaries. And government-employed extension officers make the rounds of (typically) smallholder farms bringing new farming methods, collecting data and sharing news from agriculture or trade departments.
Building Agent Networks is Capital Intensive
The difference now is that players in the agriculture value chain, especially tech startups, are actively trying to create networks. Faced with stagnating growth in digital adoption, the prevailing wisdom for building AgTech products is to bundle multiple services that typically cover multiple stages of the value chain and are intermediated by human agents and coordinated on digital platforms.
In 2023, Sheena Raikundalia left her corporate job at the head of the UK-Kenya Tech Hub to co-found and lead growth at Kuza Biashara. Kuza trains and equips agents with portable projectors and digital advisory content that enables agents independently to provide curated extension services to farmers as part of an open network that supports other non-Kuza AgTechs and participants in the agriculture supply chain.
But building agent networks is a very expensive endeavour, even more so in agriculture where transactions are infrequent or follow seasonal cycles. According to Abrhame Endrias, chief executive at Lersha, it also means building additional capabilities beyond the original scope of the afri-tech.
While agent networks bring with them confidence that the company is reaching the right people. It also meant that Lersha, whose core business was providing access to farm input and mechanisation, needed to strengthen its agent program in order to retain agents. “To make an agent very active you have to build multiple services,” Endrias told the audience at Mercy Corps’ AgriFin event in Nairobi in October, “One of the things we tried with Mercy Corps was to build data-driven credit-scoring to provide confidence to financial institutions. But we did not have [the] data.”
Ultimately, Lersha had to rely on its agent network again to help it build out its first credit scoring model. The same credit scoring product that it needed in order to keep agents engaged, underscoring the self-reinforcing loop of tying its digital offerings to semi-digitally coordinated agent networks. 42,000 farmers now get micro credit and insurance through Lersha’s agent-network supported digital platform.
Agent networks in agriculture have not yet reached the critical scale necessary to radically transform rural agriculture in Africa in the same way agents transformed mobile money. And it may not achieve the same effect. But for now, it is an approach to deliver scale that is promising. Agri-techs and their partners are leaning into it.
Abraham Augustine writes on Money, Myths & Digital Africa here.
*The views expressed here are the author’s own and do not necessarily reflect the editorial stance of The Kenyan Wall Street.