From investment banking to getting mobile banking into the hands of remote farmers, David Davies’ career shifted gears considerably after entering a hackathon at the Fintech World Forum in 2016. Pitching an idea to use mobile devices and Blockchain technology to build trust and cooperation in remote farming communities, Davies and his collaborators created AgUnity, attracting attention from many influential organisations, including Gates Foundation, along the way.
Since then, AgUnity has grown from being an app to an entire operating system that’s simple, easy to navigate and, most importantly, already helping remote communities in Kenya, Sierra Leone, Papua New Guinea and beyond. AgUnity can assist with everything from selling grain to purchasing goods from equipment providers and paying for goods. AgUnity’s co-founder and CEO, David Davies spoke at Global Table on the future of sustainable supply chains. Here he explains how exactly AgUnity has helped small-scale farmers and outlines the potential for technology to solve food waste and traceability problems.
The major challenge of developing world farmers comes down to trust and cooperation. If I’m a small-scale cocoa farmer and I’ve got cocoa beans to hand over, I’m not going to hand them to you unless I get cash on the spot because in most cases I can’t read and if I can, in many instances, getting a receipt and turning up with it later to get paid is not always reliable. And if I have to get the police involved it’s going to cost me more because I have to bribe the police. That is the main issue in developing countries. There’s often no way of recording things or no way of knowing who owes who, so the whole food supply chain really is inefficient. In places like Papua New Guinea we see almost half the green cacao beans rotting just because there’s no one to buy them.
Our application, at the very simplest level, can help people notify buyers at the cooperative that they’ve got beans to sell, and when that person shows up they can receipt that process so when they’re doing handovers they know there’s a secure record. It doesn’t ensure they get paid but the communities are very good at enforcing things when there’s a clear record. It works in the opposite way as well for providers who seed the fields for farmers, for example, and need to get paid.
We filled the gap in applications in that really bottom end of market that nobody is normally interested in providing a solution for because they don’t see that there’s a money-making opportunity in that area. There are plenty of applications that have changed the world for you and I: all the things that we do like calling an Uber or booking a hotel room or a flight. But they’re not the things that are used by really low-income people in the world. They need much more basic services, delivered with a really simple, one step at a time interface. They have challenges with communication in remote areas and identity, and we solve all of those with one package.
Usually there is some beneficiary. Initially, we started just solving the problem, not worrying about who pays. Then we realised that a lot of organisations have trouble connecting with these last mile users. The first obvious one was the NGOs. They’re never really sure who’s benefiting from their programs. The second one was commodity and service providers; people selling solar kits for example. They really want to sell products but how do you sell a single solar kit into the back of Bougainville island? We created systems where we’ve got a hundred farmers, we can make a solar kit available on the platform and then the co-op can order 50 or 100 of them. It makes it much easier for people to provide products.
But the two that were really an epiphany for our revenue model was commodity buyers and banks. We’ve now moved from being an app to being the whole operating system on the phone. We decide what other apps are pushed on to it after consultation with a group of farmers and we can also give them training. It makes it much easier for people who perhaps are receiving the first bit of technology they’ve ever had in their life. We’ve spent years getting to what we have is really relevant and useful and understandable to that particular demographic.
Normally we work with a partner on the ground, such as a large Japanese coffee buyer for example, and we set up a group of farmers and we give them the phone. That’s our preferred method. Two major places we’re working in at the moment are Papua New Guinea, particularly Bougainville with the coffee projects in the highlands, and we have another project in Ethiopia, working with World Food Program, that’s quite a large one, and then Sierra Leone, Trinidad and Tobago, and we’ve got smaller projects in Indonesia, Solomon Islands and a couple more kicking off in Vietnam and Guatemala. So we’re pretty much spread across the developing world.
There’s two billion people in the world that fit within our demographic, and there really isn’t much that’s been designed specifically for them. Two important things are getting the scale in markets and then secondly to get one really strong use case. This is why Bougainville is so important because later this year  there’s a referendum and so Bougainville will hopefully be a new country, and we believe we can hit a critical mass in that country where just about everyone has the AgUnity app. That’s the medium-term goal, for the next couple of years.
OK, so we’re also the technology company behind a number of developing market solutions, most notably Escavox, and one of the observations that came from the Escavox project is that in Australia you can probably carve a billion dollars of food waste away through better tracking and logistics solutions in retail. What was really disappointing about discovering that was that no one really cares about food waste per se and the reason seemed to be that they’re not sure who profits from it. Everyone’s talking about food security and food waste at the UN level but because no one can work out what the economics of it is, they’re not really addressing that problem.
Leading to the question of is food cheap, I think there’s a secondary problem that a lot of people in the food supply chain have a motivation to make it more expensive. I think causing waste actually contributes to food being expensive. There’s a really interesting paradox around that.
I’ve been working really hard to stop eating non-sustainable fish. The more we see what’s happening in developing markets, the more I wish there was proper traceability and provenance on fisheries. I see New Guinea’s making some concerted efforts on that but if we can’t tell the provenance, we try to avoid those things. I think that’s a huge opportunity to start showing better traceability to the consumer. From the Escavox project and another we’re doing in the fishing industry, I think it’s entirely possible and I think it’s one where the consumer will drive the demand. Particularly China, where you have a lot of issues with food trust. If you can show this is really tuna caught sustainably from New Guinea then you can increase trust and thereby the value of the produce.
I think the recent one has got to be the amount of food waste that occurs in the supply chain – and where it occurs. We were looking at one supermarket chain in Australia and if they just dealt with their supply chain more efficiently the amount of food you would save could eliminate all malnutrition in Australia and supplement the diets of everyone living below the poverty line in Australia. And it’s do-able, that’s the thing! Particularly with fresh vegetable produce, which is the healthiest thing to get at the market, but is being rejected either because it’s been improperly handled – which is easy to remedy – or because they don’t look quite right.
Find out more about AgUnity and how it can be used by visiting agunity.com