Today I read an article by Steve Case, the Founder and previous CEO of AOL. He claims that during AOL’s rise, the Internet was being built by companies like his, and that AOL’s success was created because it created an online community. He then goes on to state that the biggest change occurred when broadband internet enabled firms like Google and Apple to take over the market with their further developed, more engaging products and services. Now, when the app development trend is reaching its maturity, a new way of doing business online is beginning to emerge.
As the internet gives us the tools to disrupt any market, even the toughest markets are now risking to be disrupted by young companies. However, as these markets are so tough, Case states that founders need to remember three things; Perseverance, Partnerships, and Policy. Perseverance because tough markets take longer to shake apart, partnerships because a team of founders is not enough to change industries, and policy because many rules must be followed in markets such as banking, shipping, construction, mining, energy generation, space exploration, insurance, and agriculture.
My personal story focuses on a combination of two tough industries, and I will explain how I am tackling all three of the things Case wants us to remember; agriculture and insurance. These may not seem like the most interesting markets to disrupt in a country such as the Netherlands, but in Tanzania, where I am now, it can change lives.
To begin at the core of my solution, I have to explain the technological innovation. For many years electronics have continued to reduce in size and price, and the growth in popularity of the Maker Movement and Arduino led me to connect weather sensors to microelectronics. This has enabled me to produce a weather station at less than a tenth of a competing product, making it more accessible for the masses: a great tool for disrupting classical markets. In order to adhere to local policy, our weather sensors are WMO compliant.
The next step would not have been possible without the ingenuity of the business model that my co-founder Tom Vanneste developed. With his colleagues at MBA he thought of ways in which these weather stations could be used for a social cause in the country of Tanzania where we grew up together. Currently, our social enterprise plan is to provide weather information to farmers, by placing a weather monitoring station on their land for free and charging a monthly fee for the data. We import these stations into the country together with our local partners such as the International Insitute of Tropical Agriculture, in order to be compliant with local Policies. We also partner with FORECA, the weather forecasting firm for Microsoft Bing, who enable us to provide our farmers with predictions of the weather. Why is this suddenly important? Because of climate change weather patterns that have been around for hundreds of years have become obsolete and only localized ground-based information is relevant.
By Partnering with local telecom providers, we will be able to place our weather information in the menu of mobile telephones (even non-smart) so that even the poorest of farmers are able to access our information. In today’s sharing economy, even data can be shared, and in this case it is subsidized by the commercial farmers and other corporations. Lastly, by partnering with international development organizations such as SNV, we will be able to develop personalized recommendations for every farmer based on the type of crop and the amount when exactly they should plant or harvest.
Having grown up in Tanzania, we know that perseverance is key to doing business as local norms will have to be worked around in the way mPesa, the local mobile payment system has done. Tom has previously worked at CCBRT, the largest disability hospital in the country, where he collaborated with a large telecom company to enable medical bill payments to be done over the mPesa system. These implementations require many iterations, and therefore we are currently building up to a large scale pilot with all of the necessary partners.
In the longer run, insurance will come into play; we will partner with a large insurance company (already in talks), to provide local farmers with the opportunity to insure their crops. Currently, the policy for insurance companies is that they need proof that the failure of a system is based on a certain cause that the customer is insured for. With weather in rural regions this has never been possible, but by having a weather station 30km away any farmer will be able to insure their crops so that they survive even the worst seasons.
By providing farmers with tailored recommendations we will be able to help them increase their yields, while our crop insurance will secure them of financial stability when they experience extreme drought. We believe that as Tanzania’s economy is primarily agriculture, this will help to improve the country’s foundation and allow it to grow in other sectors such as education, transport and construction after that.
Our most recent success has been our enrollment into an accelerator program funded by the European Union, which has provided us with grant funding as well as mentoring. With this funding we will be able to scale up to 150 stations in Tanzania in the next 6 months, enough to attract international attention as well as provide the critical mass of users. We will place all the important updates on the Kukua website.
Find the Steve Case’ original article on the Washington Post.
