Ag Tech Sunday - Reinventing Agri Input Commerce for the next decade

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By Venky Ramachandran

How do you reinvent something for the future?

Now is the time when the air is filled with freshly baked resolutions; venture capitalists are busy writing about trends to watch out for in the upcoming decade. Even if you don't indulge in such exercises, it is important to figure out what these pointers mean beyond the obvious.

This skill to decipher resolutions, trends and predictions is very important, especially if you are working with the last real technology available to humans on planet Earth: Agritech, of course.

Here is a clue to build that skill.

What do you read from this clever quip, beyond the inspirational claptrap?

This is going to be counter-intuitive to grasp.

When Alan Kay, the famous PARC computer scientist, said, "It's easier to invent the future than predict it", contrary to what it seems, he was not talking only about technology, he was also talking about............time.

When William Gibson wrote,

"The future is already here — it's just not very evenly distributed"

he was not talking only about technology, he was also talking about.........time.

Technologists deep in their bones understand that innovation is the art of inventing time in such a personalized manner that your incumbent identity and narrative no longer feels the same without it. You have invested so much into it that you can't imagine any future without it.

I had a vivid experience of this, when I saw in Central America how personalized fertilizer packages were delivered by agri-input firms to their loyal channel partners through private label arrangements, curated specially with a unique mixture that has been adapted to the local soil context to deliver the necessary nutrients and prevent eutrophication. Here is the best thing: All of this happened with little digitization.

Although this experience was a gentler "wow", when compared to fancy "already here future" digital technologies I've seen in action in fields like drones or precision agriculture, this mundane example triggered a visceral response in my gut to entirely refactor my agri-input commerce expectations of the future.

When you've been way too familiar with the bureaucratic, apathy-driven, subsidy guzzling, saturated fertilizer market in India, an experience like this completely rewires your understanding of the potential of personalized precision agriculture at scale and consequently, of time. Subjectively speaking, this experience was my closest "time-travel" experience from the future to the present.

With that preface put together for context, shall we move into the topic for today?

If you carefully look beyond your biases and really observe what's happening on the ground, two visions about the future of agriculture have been quietly playing out, competing with each other.

Vision #1: Small land holding farmers don't matter in the long run, as their farms will be eventually consolidated by the market economics of digital agribusiness.

Vision #2: Small land holding farmers matter in the long run, as it is morally important to protect agriculturists and their fragile cultural ecosystem from digital agribusiness.

I say quietly because this has been more often implicit than explicit, especially, in the case of Vision #1. Although, there have been few instances when this has been made explicit by economists.

Although many agritech professionals I know have invested in Vision#1 and have been more or less vocal about picking their sides, being an independent agritech consultant, I have the freedom to work towards both Vision #1 and Vision #2.

Similarly, if you look beyond your biases and really observe what's happening on the ground, two visions about the future of agri input commerce have been playing out, competing with each other.

Vision #1: Traditional Agri-Input Retailers don't matter in the long run, as they never had the right skin in the game in the first place, often colluding with agri-input manufacturers at the expense of farmers.

Vision #2: Traditional Agri-Input Retailers matter in the long run, as it is impossible to serve farmers in a vacuum and ignore the complex web of relations they are enmeshed in.

Those who've read my blogs regularly know my bias towards vision #2, and I've written lots about it, although, in the recent months, I've been recalibrating my vision, wondering if I've been too blindsided, given the growing prominence of Farmers Business Network (FBN) as a poster boy embodying Vision #1.

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In a recent interview with Charles Baron, FBN Co-Founder. Charles spelled out his vision in modest but clear terms.

"Very simply, we’re a network of growers. We have a big community, about 9,600 farmers who are wanting to change the industry, to change the basic framework and the rules of the game they have to operate in"

Their game play has been clear.

They are building the Amazon Prime membership program for growers and smartly leveraging the data flywheel built around their members' farms to bring disruption through transparency and fairness in pricing of agri-inputs. And once the flywheel has been set in motion, they have been able to leverage the flywheel by offering options such as zero percent interest financing and passing on other flywheel efficiencies to farmers.

Given this disruptive proposition, it helps them to take an anti-big Agri Companies stance. And like Google, who has invested in FBN, they could afford to say: Don't be Evil

The other day Amol Deshpande, CEO, FBN had this to post in his LinkedIn feed, while sharing one of FBN updates.

"Major seed companies use yield based marketing and tactics such as zone pricing and rebates. We are going to bring change to this industry and more profit potential to farmers."

They have been disrupting the industry pricing tactics and bringing more transparency to the end customers. Sample this traditional rule of the industry they have been challenging.

1) Seed Relabeling: When a same seed variety is sold under different brand names. This has been a common industry practice among seed companies to cover the gaps in addressing the breadth and width of their market.

It is no surprise that they are taking their Amazon Prime play book to the next level when they announced their agri input retail partnering with traditional brick and mortar retailers to offer faster fulfillment options to their grower community members.

Pay attention to this news excerpt in this announcement, where the co-founder is quoted verbatim. I have bolded the main point where I want you to pay attention.

"We have a staff of PhD agronomists that are regional and our farmers can talk to them through our system to help make decisions on seed, chemicals, fertilizer and disease issues,” Baron says. “These agronomists are not on commission. They are a support line combining their deep agronomic knowledge and our network intelligence.”

It's obvious they are highlighting the skin in the game problem which I had elaborated in my long essay on spurious pesticides menace.

If you want to understand the e-commerce game play and how it would re-imagine the agri input commerce, it is important to understand that that we are seeing a war of these two visions and once the winner is decided, it would completely reinvent the agri input commerce experience for the customers.

Additional Recommendation: Do check out my friend Shane Thomas's detailed essay on navigating the next decade in Agri Input Commerce.

How would e-commerce game play look like, in the light of these two competing visions for agri input commerce?