The first event in the Grow Asia Digital Learning Series took an overview of the AgriTech landscape across Southeast Asia. We took a look at past investment in the space, and the potential for growth in the near future. We also examined the latest trends in AgriTech, and the impact digital technologies can make on the livelihoods of smallholder farmers.
In our breakout session at the event, we tapped on the collective experience of the participants to identify key pain points for agricultural ecosystem players, and determine which of these problems can be solved effectively by startups and their digital solutions.
Yohanes Sugihtononugroho CEO & Co-Founder of Crowde
Hujjat Nadarajah CEO & Founder of Tun Yat
Jonathan Paul Chief Commercial Officer & Co-Founder of Adatos.ai
Nurdiana Darus COO of Landscape Indonesia (Moderator)
Check out our event highlights below:
Identifying pathways to digitisation
We are only just beginning to see what digital solutions will achieve for farmers in ASEAN. Last month, Grow Asia released our directory of 60 leading digital solutions. We estimate that together the listed solutions are used by just 2.5% of the 71 million smallholders in the region.
However, Grow Asia shares the optimism of a growing community of business leaders and investors that see great potential in digital technologies for farmers in ASEAN. For example, ten years ago, training millions of farmers by travelling from village to village seemed impossible to resource. Today, with Facebook now a feature in even the most remote area, regular customised training at scale might finally be within reach.
Most startup founders, agribusiness leaders and investors have moved beyond asking if the time is right for digital disruption in smallholder value chains, and are now asking how. As a sector, we need to think carefully about where we will start, which problems can be solved first, and will deliver results most quickly.
At our first Digital Learning Series event for 2019, we had 63 sector leaders in the room in Singapore, and more than 20 dialling in from the region. Grow Asia presented a very basic thesis: first, we as a sector should begin by identifying the pain points digital solution can solve, rather than which technology we should use. It seems obvious, but digital solutions can only reach scale if customers are willing and able to pay to have a pain point addressed.
With this in mind, we presented six pain points at the event:
Farmers lack information in skills and knowledge in Good Agricultural Practices
Food Companies lack information on the origin of the commodities they buy
Lenders lack information to assess farmers
Farmers lack access to buyers and prices
Farmers lack insurance for weather events
Farmers lack information on their plot (including soil and weather)
While the list is not exhaustive, it provides a framework to start prioritising where to focus. Whether you’re a founder, agribusiness or investor, working out which problem to focus on is important. Three criteria are key:
A. To what extent can this pain point be addressed by digital solutions?
B. How critical is this pain point to the customer?
C. How feasible or lucrative is it to build a solution to this problem?
This framework gave us an interesting opportunity to crowdsource insights from our attendees from across the sector. We broke into eight groups and ranked each pain point against all three criteria in a matrix. Key findings were:
‘Lenders lack information to assess farmers’ scored the highest. With formal lending to farmers currently so limited, business leaders foresaw strong feasibility and viability in digital lending.
Insurance for weather risk was perceived as the poorest choice. Participants question how a viable business model could be built around this challenge (criteria C).
Training Farmers achieved a surprisingly low score, given the large number of solution providers focused on this problem. Like insurance, it was perceived as lacking a revenue model.
‘Food Companies lacking information on commodity origin’ was viewed as promising, with a solid score on all three criteria.
The event also featured the official launch of the Grow Asia Digital Directory.