Why Just Selling Productive Equipment to Smallholder Farmers is Not Enough
Posted: Wed Feb 12, 2025 7:12 am
A new wave of companies are bringing equipment powered by renewable, decentralized energy to smallholder farmers. Solar-powered refrigerators, water pumps and milling machines (among other devices) have the potential to significantly increase yields and reduce wastage. But turning that potential into economic impact — making productive equipment actually produce — takes more than just technology. It requires a deep understanding of the systems that these companies are disrupting, and raises a need for bundled interventions to address the overlapping barriers that farmers face.
To overcome these barriers, Acumen is supporting companies that are combining productive equipment with market access to help farmers improve their incomes. Market access — having a ready buyer who will purchase excess production and pay a premium for higher quality — is a fundamental criterion for impact investors or philanthropists to consider australia whatsapp number data when investing in solutions that promise economic impact for smallholder farmers.
The Problem: Smallholder farming needs an enabling system in place to work
Smallholder farming produces 30-34% of the global food supply, and provides livelihoods for 2.5 billion people. Unfortunately, these farmers also comprise a significant share of people in poverty, so boosting their income can have a substantial impact on global poverty. Supporting smallholders can also help preserve the environment: Having food chains that are local and decentralized — with small farms, not factories, at the center — is a crucial part of building resilience to climate change. Yet for smallholder farmers to thrive, a core set of fundamentals need to be in place, including access to land, inputs, equipment, capital, advice — and above all, markets.
It has become clear that simply providing these farmers with modern equipment won’t address these multifaceted needs. A new piece of equipment might increase yields or improve quality, but to what end? Imagine a tree growing in a flower pot: If the growth has nowhere to go, it can become a strain — even a danger. Similarly, if a farmer cannot find a buyer to absorb their extra output, or one who’s willing to pay a premium for higher quality, the new equipment can make farming less profitable, not more. Too many agricultural interventions fail when farmers cannot find a market for their increased production and the boon becomes a burden.
To overcome these barriers, Acumen is supporting companies that are combining productive equipment with market access to help farmers improve their incomes. Market access — having a ready buyer who will purchase excess production and pay a premium for higher quality — is a fundamental criterion for impact investors or philanthropists to consider australia whatsapp number data when investing in solutions that promise economic impact for smallholder farmers.
The Problem: Smallholder farming needs an enabling system in place to work
Smallholder farming produces 30-34% of the global food supply, and provides livelihoods for 2.5 billion people. Unfortunately, these farmers also comprise a significant share of people in poverty, so boosting their income can have a substantial impact on global poverty. Supporting smallholders can also help preserve the environment: Having food chains that are local and decentralized — with small farms, not factories, at the center — is a crucial part of building resilience to climate change. Yet for smallholder farmers to thrive, a core set of fundamentals need to be in place, including access to land, inputs, equipment, capital, advice — and above all, markets.
It has become clear that simply providing these farmers with modern equipment won’t address these multifaceted needs. A new piece of equipment might increase yields or improve quality, but to what end? Imagine a tree growing in a flower pot: If the growth has nowhere to go, it can become a strain — even a danger. Similarly, if a farmer cannot find a buyer to absorb their extra output, or one who’s willing to pay a premium for higher quality, the new equipment can make farming less profitable, not more. Too many agricultural interventions fail when farmers cannot find a market for their increased production and the boon becomes a burden.