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Inside View: One Acre Fund

One Acre Fund serves over 130,000 farmers and their families in East Africa with education, finance and access to the local markets; the services are all within walking distance of their customers

Michael Hudson is Director of Innovations at non-profit organization One Acre Fund. One Acre Fund works with farmers in rural East Africa to help them generate sustainable income from their farms rather than relying on handouts.

Founded in 2006 by Kellogg School of Management MBA Andrew Youn (his alma mater was one of the first funders) , the organisation serves over 130,000 farmers and their families, which include more than 520,000 children. They plan to grow this to one million households by 2020.

Their services to farmers include education, financing, and facilitating local market access. The organization is currently recruiting a Program Associate and a Program Manager to be based in rural East Africa.

Tell us about your work at One Acre Fund
One Acre Fund plans to become the largest network of smallholder farmers in the world. We increase farmer incomes by improving farm yields in some of the poorest parts of the world.

Smallholder farmers around the world simultaneously face a number of barriers that prevent them from realizing high farm yields. These include: 1) Little physical access to high quality seed and fertilizer, 2) Lack of access to financing, 3) Lack of education on the use of quality inputs, and 4) Poor systems to realize post-harvest profits.

One Acre Fund innovates access for smallholder farmers. We do this in two ways. First, we offer customers a complete "market bundle", which consists of farm inputs, financing, extension, and market facilitation. Second, we bring that bundle of services within walking distance of our customers. We make it as easy as possible for rural farmers to access and benefit from life-improving products.

In the last six years, One Acre Fund has grown from 38 farmers in Kenya to 130,000 farmers in Kenya, Rwanda, and Burundi. Our customers double their farm income per planted acre, which is verified through rigorous monitoring and evaluation.

Field operations are currently 80 per cent financially sustainable, and Kenya and Rwanda operations will break even in three more years. By breaking even, we hope to show that microfinance can be a viable commercial solution for rural farm areas – if combined with extension and if focused on farm input finance.

What's your role and how long have you been there?
I have been with One Acre Fund for two and a half years, and I am currently the Director of Innovations for One Acre Fund, Kenya. I lead a team of expatriates who run projects focused on new product development and program innovations.

New product R&D consists of researching both agricultural products, such as bananas, and assessing the viability of various non-agricultural products, such as low-cost solar lights. Examples of our projects include increasing client density and experimenting with more efficient repayment systems. One Acre Fund is an incredible distribution network; my work aims to ensure that we are efficiently rolling the most cost-effective, high impact products through this network.

You've worked on microfinance projects in Asia and in Africa - any major differences between the two experiences?
Microfinance in Vietnam looks very different from microfinance in East Africa. I would highlight two primary differences: government and penetration to rural areas.

In Vietnam, the government plays a major role in setting interest rates, building risk management strategies, and identifying viable borrower networks. The government of Kenya is far more laissez-faire about microfinance, allowing private institutions to have more control over their business models. 

Vietnam, however, has a more developed rural, agricultural finance market, which is part of why Vietnam is so successful in agriculture. In East Africa, microfinance is largely limited to urban and peri-urban areas, which drastically limits access to credit for rural farmers.

You did your undergrad in Anthropology at Colby College in Maine. Did this shape your decision to work in the non-profit sector?
My undergraduate studies in Anthropology have influenced my work in countless ways. Probably the most important and applicable lesson that I took from Colby was the importance of being inquisitive in new contexts.

In the field of development, it is common for organizations to design poverty alleviation strategies in isolation from their target beneficiaries. Often, these strategies prove to be irrelevant when they are actually implemented. Anthropology taught me the importance of learning about the people that I am serving. As a result, I believe strongly in treating the poor as customers and I strive to build strategies and technologies that are appropriate for these customers. The only way to do this well is to develop a thorough understanding of our clients.

Have you considered doing an MBA or going to business school?
Yes, I have considered going to business school. I think it would be an amazing opportunity to develop a broad understanding of business principles and best-practices.

Do you every hire MBAs to work at the One Acre Fund, and if so what would they typically do?
We hire people with all sorts of advanced degrees: MBAs, MPPs, MPAs, etc. Typically, these individuals join our field team, developing into the next layer of field leaders within the organization. Others pursue finance, policy, or business development roles.

What advice do you have for MBAs who'd like to work in development?
In my opinion, the field of development needs far more implementers and managers. The field has done an excellent job of developing a long list of life-saving and life-improving technologies--de-wormers, chlorine for water treatment, fertilizer, solar lights, improved cookstoves, immunizations, etc.--the unsolved challenge is figuring out how to get these technologies to the end user in a cost-effective way. My advice is to focus your work where you will get the greatest return for your time and energy.

What are the best (and worst) things about living in Kenya?
For the past two and a half years, I have been living in a town called Bungoma, in western Kenya. Bungoma is one of the centers of smallholder farming in Kenya, so it's a practical location for One Acre Fund. It is not the social center of Kenya, however, and so it sometimes requires a little creativity to keep things exciting. Luckily, Bungoma is very near to some amazing spots--Mount Elgon, Lake Victoria, and the source of the Nile River. One of the best parts of life here is being able to adventure to these sorts of places in my free time.

Probably the most challenging part of living in Bungoma is the infrastructure. Bad roads and power outages are a part of daily life here, and can complicate situations that would otherwise be very simple.

One Acre Fund is currently recruiting for a Program Associate and a Program Manager to be based in rural East Africa. If you would like to learn more about these positions and to apply please message Michael or visit here for more details. 

Comments.

Wednesday 9th May 2012, 10.18 (UTC)

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I like that this was started by an MBA. I will share the opportunities with friends who want to work in development in East Africa. I don't envy the lack of electricity but it looks like you're doing a great job:D!

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