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Like many startups, Hello Tractor early on was well-positioned to over-promise and under-deliver, Jehiel Oliver, CEO and founder, told those attending ProgressNEXT 2019 last week.
In partnering with John Deere, the manufacturer assumed the startup, focused on providing tractor-sharing in emerging markets, would have backend infrastructure in place, a ready-to-go mobile app. It had to get up to speed quickly on those things.
“We had [people] specialists on the ground who could gather insights and translate those insights into products. But we were short on engineers, like most startups. We needed to accelerate our deployment and spend less time on backend infrastructure. We looked to Kinvey as a product partner to accelerate our app development to free up that time to focus on what made us relevant,” Oliver said, referring to the Progress low-code app-development tool.
Oliver broke out in uproarious laughter when I asked in an interview whether he wrote the mobile app himself. He’s a finance guy who was looking for more meaningful work than he was finding in investment banking.
Hello Tractor operates in seven countries in Africa, India, Bangladesh and Pakistan. Sixty to 70% of the farmers are women cultivating plots of 1 to 5 hectares (2.47 to 12.36 acres). In a country like Nigeria, they’re growing crops like cassava, rice and peanuts. A lot of maize is grown in Kenya, he said.
Tractors are too expensive to buy for most farmers in these countries, while manual labor is expensive and inefficient. In Nigeria, renting a tractor costs around US$70 per hectare, while cultivating it with manual labor would be around US$200 per hectare.
Hello Tractor aggregates demand for regular-sized tractors (sub 100 horsepower) on these small farms. It has a team of about 20 mostly in Nigeria and Kenya.
“We realized we had to take an ecosystem approach because we didn’t have the luxury to focus on one thing. There are so many gaps in the market, we had to develop technology solutions to address all those gaps and do it in such a way that was cost-effective and nimble because we didn’t have the luxury of burning engineering hours either,” he told the audience.
“We get compared to Uber a lot. Uber operates in functional environments that have everything. It just adds this rental thing,” Oliver said in an interview.
“Our technology stretches across the farmer, the booking agent, the tractor owner, the banks that finance the tractors — we worked with IBM [on apps] for that. We work closely with the dealers because they provide after-sale support, and they need to know what spare parts are needed and what kits to send out with their technicians. So we share things like engine hours with them for the tractors that they sell.
“It’s just this entire ecosystem that’s riddled with market imperfections where better information and better transparency are needed. So that’s what we hope to provide. We don’t have the convenience of doing one small thing really well. We do a whole lot of things at a very mediocre level,” he said, laughing.
Its technology includes IoT, cloud, web and mobile as well as analytics for predictive maintenance and in the banking apps, using tractor data as well as historical data about crop yields and tractor owners’ success to determine credit risks.
A telematic device is placed on each tractor that tracks it. Using the web or mobile application, the tractor owner can know where it is at any moment — a plus for physical security of the asset. The app also shows how much work the tractor completed, how much time it idled, the distance it traveled on the road.
Connectivity is one of its biggest technological issues. The apps and telematic devices have offline modes where data is stored locally and pushed to the cloud once there is connectivity.
Aggregating demand is vital to the project’s success. Because the farmers often don’t have smartphones or digital literacy, booking agents set appointments in clusters. A cluster could be 25 farmers with 1 hectare apiece in 10 square kilometers (6.2 miles).
“It has to be close enough that you’re optimizing the output of the tractor and minimizing travel on the road,” Oliver said.
Appointments are generated through a separate booking agent application built on Kinvey. This has created a job opportunity for booking agents, who may be a young person with digital literacy or someone already with a relationship with the farmer, such as a dealer of seed and fertilizer. Tractor owners also are creating jobs for drivers, repair technicians and others, he said.
“There is a mini-economy growing out of this platform,” he told the audience.
Each of tractors is serving over 200 farms. Hello Tractor has served more than 250,000 farmers, who have cut their costs by 40 percent and increased their yields in some instances by seven-fold, he said.
Going forward, the company is focused on building out its presence in Pakistan and India and building on its partnerships, Oliver said.
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