March 2021 agricultural “platforms” in a digital era

adjacent industries. The smallholder 
agriculture sector is, to a large extent, an 
untapped market; it is therefore attractive to 
businesses active in adjacent sectors, which 
believe they have the resources, capabilities, 
networks, relationships, or other assets to 
succeed in this market, and are often already 
serving farmers for non-agricultural needs. 
For these players, setting up an agriculture-
specific Platform represents the opportunity 
to participate in a new market. DigiFarm 
and EcoFarmer are two examples of mobile 
network operators (MNOs) using their existing 
relationships with customers and digital 
infrastructure to enter the agriculture space.
By far, the most common type of Platform operator 
that we identified in the agriculture sector was 
tech start-ups, which represented 75% of the 
Platforms across all types of marketplaces.
There are a few reasons why this might be the case. 
First, Platform business models are vastly different 
than pipeline business models, requiring a mindset 
shift that can be tricky to navigate for existing 
pipeline businesses (but less so for tech start-ups). 
Successfully running a Platform requires gaining 
the trust of both sides of each interaction. Here, 
tech start-ups may also have an advantage, as they 
can more easily position themselves as neutral 
facilitators and arbiters, rather than actors with 
a significant stake in the interactions or who may 
even be a direct competitor to potential Platform 
users. Additionally, the economics of agricultural 
Platforms are challenging; while there is much 
potential, it is a risky venture better suited to
tech start-ups. 
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Tech start-up Platforms tend to have high degrees 
of innovation and churn, but vary in their scale. 
While several serve over 500,000 farmers, two-
thirds of these emerging Platform operators reach 
fewer than 100,000 farmers. On average, they are 
three to four times smaller than Platforms run by 
mobile network operators or agribusinesses. How 
many of these emerging Platforms will outlive 
their product-market fit testing stage will depend 
on how quickly they can reach and sustain a large 
enough scale to create value to users without 
running out of cash.
More established players—such as large 
agribusinesses or mobile network operators—tend 
to focus on two types of marketplaces. The first 
is integrated farm services marketplaces (such as 
DigiFarm, FtMA, and Rural Taobao), where large 
operators can leverage their existing infrastructure, 
brand, and customer base to set up higher-touch 
models, cross-subsidize, deploy capital needed 
to scale, and more quickly onboard users on both 
sides of the market across a variety of interaction 
types. The second is asset sharing marketplaces 
(such as Trringo and JFarm), where operating a 
Platform can benefit the core pipeline business.