Solving for Impact: Komaza’s Farming Innovation Model

Komaza

Centered in the overlap of farming, sustainability, and business, Komaza is a Kenyan startup seizing opportunities for positive change amid the country’s forestry crisis.

Agriculture has long been central to developing economies, but it also poses some of the most significant challenges.

Deforestation, for one, is a considerable threat to ecological and biodiversity balance. Agriculture is one of its main drivers. Commercial and subsistence agriculture together contributed to over 70% of the deforestation that took place between 2000 and 2010.

Agriculture is especially important to emerging regions like Asia and Africa. Asia, for instance, exported 19% of the world’s total food and agriculture goods, but imported nearly twice that quantity.

Meanwhile, bearing in mind concerns of environmental impact and the destruction of tribal lands, forestry is also a key issue in these regions. Forests often face threats on multiple fronts: Kenya’s forests are being pressured by charcoal and timber production, agriculture, logging, and urbanization.

Reports suggest that deforestation in some African areas is decreasing). In response to the growing awareness of agricultural and forestry issues, agritech has been gaining momentum, driven mostly by concerns around food security and sustainability, and advancements in emerging technologies that can solve these key issues.

2016 Deloitte study found three key areas for high-impact growth within agritech – yield efficiency, supply chain efficiency, and the farmer’s value chain. Startups have risen to the challenge, providing solutions across a spectrum of possibilities, including end-to-end farming support, farm-to-table marketplaces, and even prevention of illegal logging.

Each of these startups have their own models, but some, such as Komaza’s, are especially unique. Based in Kenya, Komaza is a Kenya-based “micro-forestry” that works with small-scale farmers to tap into the business of wood.

Komaza’s social enterprise model

Komaza’s journey started when researcher Tevis Howard visited Kenya on a research project, Esther Mutuma, Komaza’s Managing Director for Central Kenya tells Jumpstart.

“All he could see was bare land and very poor people living around that geography,” Mutuma says. Howard began thinking about what he could do to change that.

“That’s how the whole idea came about–they have land, and we can try to do something with the land,” Mutuma says. “He got a few people to support him – mostly his family – and some initial grant money, and he got started. That was 12 years ago.”

Komaza has raised over $37 million so far, the bulk of it through its US$28 million Series B round in July last year. Noting that social enterprise and impact investing have become emerging areas of interest for investors, Mutuma explains that Komaza follows the triple bottom line mantra: “People, Planet, Profits.”

The startup’s core operational structures are designed around the needs and interests of the farmer, who is central to the functionality of Komaza’s model.

Komaza’s support ecosystem helps dry-land farmers in Kenya to reach industrial wood markets. The company provides farmers with resources such as training and farming inputs, and maintenance and harvesting services. In return, farmers sell their harvested trees to Komaza, which the company then processes into commercial fuel and industrial wood.

At the same time, the company also recognizes and addresses questions of ecological balance and protection by trying to sustainably calibrate the supply-demand relationship in Africa’s wood supply.

According to a 2015 report by the UN Environment Programme, 90% of wood consumed in Africa is from the unorganized charcoal and fuelwood industry. Demand for industrial roundwood is also increasing, expected to grow 2-3X by 2050.

This is further stressing Africa’s already vulnerable forest land, 75 million hectares of which were deforested between 1990 and 2010. Land degradation, over-harvesting, and deforestation are serious concerns for Africa’s forest economy, the report suggests.

Forests in Asia face similar problems as well. For instance, 15% of the world’s tropical forests can be found in Southeast Asia. At the same time, the region faces large-scale losses of habitats and biodiversity.

The third pillar of Komaza’s business – profits – is what keeps the company’s wheels in motion.

“If you’re not making profit, then you’re going to go out of business,” Mutuma says. “Grants can only take you so far, and people are going to get donor fatigue. You’ve got to attract proper money that’s going to go into commercial purposes.”

Innovation to impact

Social enterprises are being looked at more closely due to their potential to solve some of the world’s most crippling issues by seeking out the opportunity in the crisis. In climate tech, for instance, interest has been booming in EV technology, meat and dairy alternatives, and renewable energy.

However, this is a long and challenging road to travel. It’s not just that these global crises demand concerted, coordinated action. They are have socio-economic and political dimensions that themselves need to be resolved. As Mutuma puts it, the farmers don’t exist in a vacuum.

“If you don’t get it right and [make] it acceptable to the communities, then you disengage, and then you’ll have a lot of issues before you get a buy-in,” she notes. “So it might take you a lot longer to actually scale, simply because you didn’t get the cultural aspects right.”

What Mutuma says is universally applicable, but especially so to Asia and Africa, which are larger, more populated continents. The Asia-Pacific region represents 60% of the world’s population, and many thousands of unique ethnicities, cultures, languages, and communities.

“My word to innovators going into this space for scale and for impact is, they really need to study and understand the cultural context, and try to incorporate that in their designs and in whatever they try to build. Otherwise it’s like pushing a white elephant, it doesn’t work,” she adds.

Relationships matter greatly in this environment. As an example, Mutuma shares how her relationship with the local government helped Komaza through the COVID-19 crisis. As someone who leads government relations and external stakeholder management at the company, Mutuma was able to leverage her relationships with government officials to help Komaza stay operational during the pandemic.

This was essential, she points out, because farming is bound by seasonal variations. Komaza’s contracts could have been jeopardized had they not been able to prepare for the monsoon rains, or work out a plan for seedlings that had already been planted.

“It’s super critical to have the right stakeholders and the right relationships onboard and very well managed […] because you’re dealing with members of the public, you’re dealing with communities,” she says. “If you don’t have the right relationships in the right stakeholder engagement, then [your solution] will not fly.”

“There is no competition in doing good”

Mutuma sees the world as a small village. Whatever is happening in one place, the knowledge, skills, and technology that come from those experiences are transferable to other regions with some adjustments.

The same, she says, applies to cross-regional technology today. “Whatever is happening in Africa, because of technology and globalization […] can easily be transferred to Asia, with a few tweaks. And the same for us, there is a lot to borrow.”

These transfers of knowledge, skill, and technology oil the machinery of the globalized world. They can fortify economies, establish diverse relations, and can help to establish a two-way support ecosystem. In times of crisis, they can be crucial. Collaboration, after all, is a 21st century skill.

Komaza, Mutuma explains, is focused on becoming the best forestry company in Africa, a goal that will easily take years to achieve. She anticipates that company won’t be expanding outside of the continent in the short- or medium-term.

“But that [shouldn’t] stop people in Asia from thinking about the model, the way we’re thinking about it, and doing something similar,” she says. “At the end of the day, we just want to do good. There is no competition in doing good.”

Header image by Gabriel Jimenez on Unsplash

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