iFarmer and The Courage to Pivot

Fahad Ifaz, co-founder and CEO of iFarmer, sat in his office in August 2018, pondering the future of his startup. Six months ago, he and his co-founder Jamil Akbar launched iFarmer as an "Uber for Urban Farming," allowing city dwellers to lease their rooftops for vertical farming. Despite their efforts, the model wasn't gaining traction. Ifaz knew they needed to change, but the question was: what direction should they take and how could they make the new idea work?

Background

iFarmer was founded in 2018 as a side project by Fahad Ifaz and Jamil Akbar. The company's initial business model aimed to create a platform where people could lease their houses or factory rooftops for farming. This "Uber for Urban Farming" concept seemed promising at first, tapping into the growing interest in urban agriculture and the sharing economy.

Apparent but not true: the challenge

However, after six months of operation, it became clear that the urban farming model faces several significant obstacles:

1. Difficulty in obtaining suitable rooftops in Dhaka city
2. Challenges in managing apartment rooftops due to the need for consensus among residents
3. Limited scalability of the model due to market size and growth potential

Ifaz and his team realized that their current path was unsustainable. They needed to pivot, but the direction was unclear. The challenge was to find a new model that could leverage the team's expertise and address real needs in the agricultural sector.

Ifaz tells FS in an earlier interview: 

“We started iFarmer as a project in 2018. The first business model was to create an Uber for Urban Farming. So we created a platform where people could lease their house or factory rooftops for farming. But after spending 6 months on this, we realized that it is not scalable and there are challenges with getting rooftops in Dhaka city, where more and more people are moving to apartments and it’s difficult to get consensus on how to manage those apartment rooftops.” 

The Pivot Decision

With a decade of experience working at the Bottom of the Pyramid, particularly with farmers and agriculture value chain actors, Ifaz had an understanding of the major challenges in the agricultural sector.

Drawing on his experience, Ifaz and his team considered pivoting to a model that intersected agriculture, finance, and supply. This new direction would aim to solve fundamental problems faced by farmers while also providing investment opportunities for middle-income individuals. 

Ifaz says: 

“In August 2018, we pivoted to our current model. This was largely motivated by my 10 years of experience working at the Bottom of the Pyramid, particularly with the farmers and other agriculture value chain actors.” 

The proposed new model had several components:

1. Offering farm assets as investment opportunities for retail investors
2. Onboarding farmers who could absorb these investments
3. Collecting and leveraging data to provide additional services and improve the agricultural supply chain

However, this pivot would require significant changes:

• Rebuilding the team with new skill sets
• Developing new platforms
• Establishing relationships with farmers and investors
• Creating a data-driven approach to agriculture financing and supply chain management

The Decision Point: Key Steps in the Transition

As Ifaz contemplated the pivot, he faced several critical questions:

1. How could they quickly build the necessary team and technology infrastructure?
2. What were the potential risks and challenges of the new model?
3. How would they fund the transition and initial operations of the new model?

Ifaz knew that the decision to pivot would be crucial for iFarmer's future. A successful pivot could position iFarmer as a leader in the agri-tech space in Bangladesh. However, a failed pivot could mean the end of the company.

Ifaz and iFarmer team focused extensively on building a team that believed in the mission of the company, had the skills to navigate the challenges of building a business in the vertical, and was willing to go through a steep learning curve fast. He reached out to his network to find the right people and convince them to join the new company. 

Ifaz explains: 

“We focused on getting the right team in place. We identified the skills that we require in the team and reached within our network to find people with the necessary skills. But we also needed people who would believe in the vision of the company.

The second step was for the whole team to go through a very steep learning curve. We did not want to know everything about agriculture finance, supply chain, or investment in general. We just wanted to learn enough to get us going. Because we believed in evolving and iteration of the model as we learn, adjust and move forward.”

This dual focus on the right people and learning quickly played an important role in making the pivot successful. We can breakdown the transition to the new model in the following way:

1. Building the right team:
   • Identified necessary skills
   • Recruited from personal networks
   • Sought team members who believed in the company's vision
2. Rapid learning:
   • Focused on acquiring essential knowledge in agriculture finance, supply chain, and investment
   • Embraced an iterative approach to evolve the model
3. Leveraging support:
   • Received strategic advice from startup incubators like Toru

iFarmer has since experienced consistent growth. Today, it is one of the largest agri-tech players in Bangladesh. While started with finance and inputs, the company expanded into new verticals and has evolved into a full-stack agri-tech player in Bangladesh. The company says it has so far facilitated some BDT 2.45 billion in agriculture finance, has more than 113839 registered farmers on its platform, and sold 299K tons of farm produce. 

Without that courage to pivot, none of this would have happened. 

Key Takeaways

1. The path to product-market fit is often non-linear
2. The courage to pivot when initial ideas don't work is crucial. The initial failure of iFarmer's urban farming model didn't spell the end for the company. By recognizing the need to change and acting on it, the company found a more viable and scalable business model.
3. Leveraging domain expertise can lead to more sustainable business models. Fahad Ifaz's experience in the agricultural sector was crucial in identifying a more sustainable business opportunity. This highlights the value of domain expertise in entrepreneurship.
4. Building the right team and creating a learning culture is essential. At the heart of it, business success is a learning problem. 
5. Identifying and focusing on the core aspect of the business model is critical
6. Data can be a powerful driver for expansion and diversification of services. iFarmer's focus on collecting and leveraging farmer data became a core strength, allowing the company to offer more services.
7. The company embraced an iterative approach, learning and adjusting the model as it progressed. This flexibility was key to its success.

iFarmer's journey from a failed urban farming platform to a successful agri-tech startup underscores the importance of pivoting in startups. By remaining flexible, leveraging their expertise, and focusing on data-driven solutions, iFarmer founders turned potential failure into success.

This case serves as a reminder that the initial idea is often not the final product and that it is important to maintain a mindset of flexible determination.