hello tractor teaser
Post on 12-Dec-2015
224 Views
Preview:
DESCRIPTION
TRANSCRIPT
Executive Summary
2
Hello Tractor, Inc. (“Hello Tractor” or the “Company”) is an agricultural technology company focused on improving access to affordable farm mechanization for the rural poor. Hello Tractor has developed a low-‐cost Smart Tractor – embedded with GPS and telematics -‐ which connects the Smart Tractor to our cloud-‐based software. Our software pairs Smart Tractor owners with farmers who can text for tractor services, all coordinated in the cloud (think Uber). The Smart Tractor is versatile (with eight different attachments), low cost, and supported by trained technicians with spare parts for on-‐site repair. The majority of farming in Nigeria is done by smallholder farmers who manage just over one hectare of land. Over 80% of these 35 million
smallholder farmers hire off-‐farm labor, to assist with land preparation, weeding, harvesting and transport of harvest. Hired labor, when available, costs approximately $5 per day or $200 per hectare for land prep alone. Rapid urbanization and an aging farm population has depleted the supply of labor in rural Nigeria, resulting in farmers undercultivating, planting late and losing income. In labor constrained farming markets tractors are the ideal solution. Unfortunately, in Nigeria only 4% of tractor demand is currently being met. The Federal Ministry of Agriculture and Rural Development (FMARD) estimates that Nigeria needs an additional 750,000 tractors to bring herself on par with global standards.
6.5 8.0
81.8
128.0
200.0
256.8
-‐
50
100
150
200
250
300
Nigeria Africa China India Global Average U.S.
Figure 1: Tractors per 100Km2 of Arable Land
“The majority of Nigeria’s smallholder farmers are often too poor to employ modern tools, such as tractors and plows, even with
substantial government support... Consequently, very few Nigerian farmers own, share, or rent modern agricultural machinery.”
Hiro Takeshima, International Food Policy Research Institute
3
Operating in a double-‐sided market, Hello Tractor sells its Smart Tractor to individual and enterprise buyers while simultaneously marketing Smart Tractor services to farmers facing labor constraints. In true shared economy fashion, Hello Tractor pairs Smart Tractor owners with farmers texting into the cloud for tractor services, ensuring every tractor is fully utilized. Where available, farmers can also pre-‐pay for tractor services via mobile money. Hello Tractor markets Smart Tractor services, to farmers, via its agricultural extension radio program, “Farmers on Air”. The Hello Tractor innovation reduces farmers production costs by up to 60%. Smart Tractor owners, providing fee based services, to farmers in their vacinity, earn five times the average rural daily wage rate. For cash-‐constrained buyers, Hello Tractor coordinates low-‐cost financing options to facilitate Smart Tractor purchases. In January of 2015, core members of the Hello Tractor team relocated to Nigeria for phase one of the product launch. Since this time, the Company has generated a tremendous amount of momentum including building an enterprise sales pipeline of more than $6.4 million in batch Smart Tractor orders. Additionally, Hello Tractor has developed key partnerships with 13 of the top NGO, public and private sector agriculture industry stakeholders and applied for over $2 million dollars in grants. The Company has also formed a valued strategic partnership with Habgito Nig Ltd, who will provide logistics, warehousing, tractor maintenance and repair support. Additionally, Hello Tractor has won every single major competition they’ve entered, including 1st at the Points of Light Civic Accelerator Competition ($50,000), the Skyrocket Brand Prize ($40,000), 1st at the University of Chicago Booth Social New Venture Challenge ($30,000), CARE International ($20,000), and 1st at World Bank Diaspora Demo Day. To continue this momentum, the Company is seeking $500,000 in convertible note financing for the following: Figure 2: Pro Forma Sources and Uses
Sources Amount % of
Total Uses Amount % of
Total Convertible Notes $500,000 75% Staffing $305,000 45% Grants 120,000 18% Software Costs 170,000 26% Founders Equity 40,000 6% SG&A 140,000 21% Assumed Debt* 10,000 1% Cap Ex 45,000 7% Assumed Debt 10,000 1% Total Sources $670,000 100% Total Uses $670,000 100% Hello Tractor’s immediate concern is capital to finance the hiring of additional technical resources along with large batch order fulfillment. This investment will ensure that momentum generated over the last year translates into Smart Tractors being introduced into underserved farming communities. Please contact: Jehiel Oliver at jehiel@hellotractor.com for more information.
4
Enterprise Case: Notore Chemicals
Batch Orders Driving Sales… Notore has a goal of developing its village fertilizer distributors into owners of Smart Tractors to enhance the value they provide customers. Each distributer is networked to over 600 smallholder farmers. Notore wants to procure a Smart Tractor for 300 distributors in 2015 alone. Notore combines all of the key aspects that we look for in a partner. Over the past few months, we have gained significant access to their senior management team, which has allowed us to quickly vet Smart Tractor owners, survey and validate markets and prepare for their first order. Through the large batch order to Notore’s network of distributors, we believe we can reach a total of 20,450 smallholder farmers and 102,270 people at the household level, creating N618.75M (USD3.09) in economic value for rural farming communities through 2016.
5
THANK YOU!
top related