There’s something ‘mysterious’ about how ideas materialises; there have been several instances in which ideas drop into my heart and I wonder where they emanated from. I’ve since learnt that I’m not alone as countless people have narrated how ideas emanated from observing things, by taking a short walk, bathing and a whole lot of other ordinary endeavours. “Ideas are the root of creation,” noted the French writer Ernest Dimnet. Ideas are the lifeblood of innovation. They are important because they have the power to change our world, and they have.
In the course of interacting with graduates and undergraduates in Nigeria, I’ve come out of some of the interactions with hope. Despite the knocks on our education system, we have incredible students who know what they want from life. I met a group recently who individually developed themselves with a promise to make an impact on society. These young men travel abroad to study concepts, why such concepts work well in western societies, the impediments that prevent them from working here and how to correct such impediments.
In essence, what this translates to is that ideas, like the air we breathe, are omnipresent. They are to the mind what light is to the eyes. Everywhere you go and every act you do provides opportunities for useful ideas. It was the omnipresence of idea that propelled Mira Mehta to establish Tomato Jos, an agricultural production company that believes in the power of farming and processing local food products for local consumption. Mehta, a Finnish/Indian and American citizen, who relocated to Nigeria in 2014, is a Harvard Business School graduate and a former Clinton Health Access Initiative (CHAI) solving HIV-related operational and supply chain problems in Nigeria. And what brought about this idea?
A paradox Ms. Mehta confronted in Nigeria propels her toward a solution. And what is this problem? It is simply this: Nigeria is the world’s 13th largest tomato producer and the world’s largest importer of tomato paste! She discovered that although approximately 200,000 Nigerian farmers grow over 1.5 million metric tonnes of tomatoes every year, half of their harvest are lost before reaching the market and the remaining 50% is subject to significant downward pressure on price due to common gluts in the markets and the perishable nature of the crop. In other to undercut the trend, farmers often line the roads with tomatoes in an effort to dry and preserve them, because prices were at an all-time low and also from preventing wastage.
She also discovered that farmers, who are among Nigeria’s most financially vulnerable population, bear the burden of both these post-harvest losses and price uncertainty. Smallholder tomato farmers lack access to a consistent, large market for their produce, rendering them unable to consistently make a profit and dis-incentivized to increase their yields or change their farming practices. As a result, domestic supply cannot meet local demand for fresh tomatoes, which, according to her, exceeds 2 million metric tonnes or $2.5 billion annually. To this end, the country supplements local demand for fresh tomatoes with $360 million (over 300,000 metric tonnes) of imported tomato paste annually.
Being the most populous country in Africa and the seventh most populous in the world she was of the opinion that this practice will have grave implications for the country’s food security situation, given that it is heavily dependent on food imports. If global food prices were to spike and drive up the price of imports, as they did in 2007-2008, she noted that Nigeria would struggle to feed its population.
From a problem, she saw a waiting opportunity ripe for the tappings. There is thus the need for commercial tomato processing operation focused on continuous production rather than absorbing seasonal harvest gluts. According to Mehta, this can increase incomes over five times for participating smallholder farmers, who comprise 75% of Nigeria’s workforce. Another opportunity she saw was that no business has yet developed a viable, sustainable model to competitively aggregate, process, package and sell tomato paste domestically. The model she adopts links farmers directly to paste production, simultaneously reducing poverty for small holder farmers, who are among the country’s most vulnerable population, and decreasing Nigeria’s dependence on an imported food product that is a dietary staple in Nigerian cuisine.
This paradigm shift can connect Nigerian farmers to domestic consumers of processed tomato products, it is projected that this will improve the lives and incomes of smallholder farmers, provide more non-farming job opportunities for the increasingly urban population, and increase the stability and sustainability of the food supply in Nigeria.
A further solution lies in substantially improving the livelihood of smallholder tomato farmers which requires moving multiple metrics simultaneously. Farmers, according to her model, must be able to sell more of their product, by increasing yields and reducing post-harvest losses; they would be able to capture a greater amount of the value of their harvest; in turn, they would be less vulnerable to seasonal price fluctuations. To make this possible, Tomato Jos embeds farmers’ production within a supportive, self-contained agribusiness ecosystem focused on local production, processing, distribution, and farming practice improvement.
Seeing her passion and detailed business plan, VestedWorld would be investing $2.1m funding round as the lead investor. Although Tomato Jos has yet to begin full-fledged tomato paste production, Mehta said the non-availability of year round raw materials is a challenge that must be surmounted. Therefore, there is need to always farm because the biggest drawbacks with tomato paste has to do with the fact that there must be continuous farming to get raw material at the right price.
Mehta said that the goal is to launch Tomato Jos tomato paste brand in the second quarter of 2020. Tomato Jos expects to produce over 6 million 70 gram sachets of tomato paste in year two and over 100 million sachets in year five. When it is fully operational, it will operate three business lines: Farm and agricultural center with farmer education and bundled inputs to help smallholder farmers grow and harvest crops more efficiently; Logistics and supply chain support to navigate the “last mile” to smallholder farms and safely bring produce to the processing facility; and Food processing and packaging facility that prepares finished goods for distribution in Nigeria.
As the business attains profitability, Tomato Jos will consider options to reinvest a portion of profits into expanded agricultural support programs for farmers in the surrounding community. Through investment in the community, it will further align farmer outcomes with the success of its venture and improve the lives of smallholder farmers and the competitive landscape for local agriculture, translating into future returns for the business.
As I interact with our graduates and undergraduates, I often encourage them to read widely in other to expand their worldview. I told a group recently that so many aspiring entrepreneurs are held back, because they are waiting for a ‘good’ idea to come to them. But in reality, there is no such thing as a ‘bad’ idea. Any idea can be a great idea, if you think differently, dream big, and commit to seeing it realised. It is going to take Mehta almost five years to actualize her dream and ideas. Going through her elaborate business plan you’ll know this is a lady that did her home work well.
Ideas change the world. The power of a new idea is the engine that transforms the way we live and think. It was almost 50 years ago that the philosopher Thomas Kuhn coined the term paradigm shift — the moment when our worldview fundamentally changes because of a new idea. New ideas and new approaches are vital to fuel growth and progress. Ideas are not just a luxury for good times; they are even more crucial in these challenging times.