Changing lives in Nigeria
Every April, the California- based Skoll Foundation — founded by Canadian entrepreneur Jeff Skoll — recognizes the best new ideas in philanthropy and activism by awarding US$ 1 million prizes to four winners of the Skoll Awards for Social Entrepreneurship.
But when the prizes were awarded last week at a conference in Oxford, England, the foundation’s choice challenged the notion that cutting- edge change can only come from not- for- profit platforms. For the first time, a Skoll Award went to a forprofit business: Nigeria’s Babban Gona, a five-year-old firm that’s changing the lives of Nigerian farmers.
Babban Gona ( which means “great farm” in Hausa) supplies training, consulting, logistics, raw materials and financial services to smallholder farms that lack the knowledge, resources or buying power to compete successfully. Working through farmers’ co- operatives, the firm served 8,000 farmers last year. By providing classroom training and infield advice, discounts on seed and fertilizer and such post-harvest services as marketing, crop storage and loans, Babban Gona has reduced costs for smaller farmers by as much as 50 per cent and boosted yields to twice the national average. Gains like these create increased prosperity and security for farmers, and break long cycles of poverty.
But founder and managing director Kola Masha has even more breathtaking ambitions. Although agriculture accounts for 25 per cent of Nigeria’s economy, the sector isn’t growing fast enough to feed a population of 190 million people that’s growing nearly three per cent a year. So Masha is betting that making farming pay again will draw more young people — in a country with 50 per cent youth unemployment. And by creating these job opportunities, he hopes to discourage young people from joining militant groups such as Boko Haram, which pays recruits to carry out its terror campaigns in northern Nigeria.
Few organizations set such daunting goals. But Appolo Goma, Babban Gona’s chief operating officer, said last week in Oxford that only a for- profit business could make this model work. Company revenue comes from small commissions on its services to farmers, and that’s not enough to fund growth. To increase its impact, Babban Gona relies on debentures sold to private investors. “The key is to keep the company profitable,” says Goma.
Further, he notes, operating as a charity would have made the company forever vulnerable to reductions in operating funds, which would force it to cut back services. Any backward steps would undermine its relationships with farmers, and threaten the survival of its neediest clients.
Masha was unable to attend the awards ceremony, as he and his wife awaited the birth of their second child. But he understands the pros and cons of business, government and not- for- profits. With a Harvard MBA, Masha has worked for global companies such as GE and Boston-based U. S. medical- device maker Abiomed. He’s been a senior adviser to Nigeria’s ministry of agriculture, and sits on the board of the African Enterprise Challenge Fund, which provides grants to innovative business projects in agriculture, agribusiness and renewable energy. He started Babban Gona as an operating subsidiary of Doreo Partners, an “impact investing” firm that supports innovative businesses in African agriculture. Masha hopes Babban Gona alone will lift a million farmers out of poverty by 2025.
To grow, however, Babban Gona needs more capital. Goma is confident the Skoll Foundation’s US$ 1 million cash injection will attract more investors, enabling the company to serve 20,000 farmers this year and 40,000 in 2018. He says Babban Gona is already looking at expanding operations to other African countries.
Given that Babban Gona is simply harnessing market forces, why couldn’t other players have done this before? Goma says the problem was too big: the farms too small, the co- ops weak and the banks unable to meet the many complex needs of small farmers. Only visionary business professionals, following a detailed business model, tapping international markets and untainted by government corruption, could pull off such a revolution.
The other three Skoll finalists were not-for-profits: ❚ Denver, Colo.- based Build Change helps communities in developing nations embrace more stringent building codes to reduce deaths and injuries in earthquakes and typhoons. “Earthquakes don’t kill people — unsafe buildings do,” says founder Elizabeth Hausler, daughter of a Chicago bricklayer. ❚ Based in Boston and founded by a Liberian, Last Mile Health works with government in Liberia to train, deploy and manage community health workers, who fan out into the country to reach patients who have never had medical help. Last Mile reached 52,000 people in 308 remote communities, which convinced Liberia’s ministry of health to adopt its model to reach 1.2 million people. ❚ Polaris Project, based in Washington, D.C., uses data to attack human trafficking, a form of slavery that affects 20 million people a year. Powered by a global hotline campaign that offers victims a way out, Polaris has acquired enough information to identify 25 types of human trafficking.