Originally posted on LinkedIn
The Babban Gona case is fascinating… it was a big part of what pushed me toward impact entrepreneurship 💜 Here’s the business model ⤵️
I was still at R5 when Pablo Armida ran a case-based strategy course. One of the cases was Babban Gona.
Mission: End crime and violence by developing Nigerian farmers. The hypothesis: if they earn more money and have employment, they won’t become guerrillas or criminals. Mic Drop 🎤 💥
Business model summary:
-
They group farmers in clusters of 4-5 (social pressure)
-
They lend them money to buy better seeds, better fertilizer, better machinery (which they also sell).
-
If someone doesn’t pay back their loan, their whole group’s score drops (Maria — PS this example is a success case of what we talked about).
-
They provide technical education so farmers can actually pull it off.
-
Babban Gona buys a guaranteed portion of the harvest, then sells it wholesale to large buyers at the most advantageous time to maximize returns (for them and the farmers).
Let me repeat the insanity of this model: They lend money to buy machinery and inputs. They sell the machinery and inputs. Then they buy the output. 🤯 🤯 🤯 🤯
And the farmer TRIPLES their income. TRI-PLES. From ~$175 USD to ~$580 USD.
They’ve worked with over 200k farmers to date. Over 500k people directly impacted in their families.
With Ignia, I want to get there in education.
Why don’t we have a Babban Gona equivalent in Colombia?
What other industries need a local Babban Gona?
PS Kola Masha you rock 🤘