The coworking concept has really expanded beyond hot desks in themed spaces for urbanites with a laptop and work to do.
Just recently, we wrote about how there’s now a co-sharing hair salon in Malaysia for beauty entrepreneurs, and now, we’re writing about a co-farming space.
Fefifo Malaysia Sdn Bhd (Fefifo) was newly launched by a founding team of 6 with skillsets across commercial farming, venture building, digital technologies, business model and process engineering, and real estate development.
They simply wanted to solve the problems of their childhood friends who were now smallholder farmers, but in doing so also realised that they were addressing all Southeast Asian smallholder farmers’ challenges.
To simplify what Fefifo does, it provides smallholder farmers and young unemployed agri-graduates with ready-to-farm spaces and technologies to kickstart a modern farming business with guaranteed off-take.
“Fefifo removes the biggest barriers to entry and challenges facing smallholder farmers to engage in modern commercial farming through a novel business model of Farmspaces-as-a-Service fee, and crop profit sharing with Fefifo,” Kelveen Soh, CEO and co-founder told Vulcan Post.
For example, if you started a 1-acre fit-for-climate greenhouse with a modern crop system, that would cost hundreds of thousands of ringgit, compared to only the first 3-month rental deposit that is <RM15k for our 1-acre greenhouse farmspace.Kelveen Soh, CEO and co-founder of Fefifo
A Support System For Growth
Farmers who work with Fefifo are termed agropreneurs, and they grow pre-curated crops.
“We have a strict crop admission policy before we admit any crop into our network,” Kelveen said.
A crop needs to fulfil 3 of Fefifo’s requirements:
- They have a pre-established market with guaranteed off-takers for it,
- They know how to grow the crop and can develop digitalised SOPs for the agropreneurs,
- It is able to support RM50,000 to RM70,000 yearly income for the agropreneur.
Depending on the crop, an agropreneur can earn a basic monthly salary of RM2,000-RM3,000.
Editor’s Update: The above paragraph has been edited to reflect greater accuracy.
“We built in a minimum pay into our crop models so that agropreneurs have some income to put food on their tables, particularly during the pre-harvest period of their first crop cycle,” Kelveen said.
An agropreneur would take up a minimum crop plot of 1-2 acres, depending on crops, for a contract period of 3 to 5 years.
“Fefifo focuses on short harvest cash crops (harvest cycle within one year). For example, the 2 crops that we are growing on our pilot farm are chilli and rockmelon, which have harvest cycles of 4.5 months and 2.5 months respectively,” Kelveen explained.
The majority of an agropreneur’s income would come from the profits after crop profit sharing with Fefifo.
Because their entire seed-to-sale process is standardised, the team is confident their agropreneurs can meet the desired outcomes.
In exchange for the farm spaces and usage of Fefifo’s proprietary tech platform called Digital Distributed Farm Network (DDFN), agropreneurs pay a monthly fee ranging between RM2,600-RM4,300 and crop profit shares to Fefifo of 30-50% (depending on the crop).
Risk management is the top priority for the co-farming business, with its model built entirely around digital growing protocols for best practices.
Unfortunately, sometimes it’s bound to happen that an agropreneur will not perform well, particularly if they’re unable to make enough to start a new cycle.
In that case, their security deposit will be used to help them exit while Fefifo looks for another agropreneur.
Farmspaces-as-a-Service, Not Farming-as-a-Service
To be clear, Fefifo doesn’t take over the farming for its agropreneurs.
Its spaces include accommodation for them and their workers as part of the Farmspace-as-a-Service fee and crop profit sharing.
“Agropreneurs are owners of the farms they set up in our spaces. Running their farm, managing crop issues and worker tasks are their responsibility,” Kelveen said.
“It is just made a lot easier with DDFN workflows and tools on their mobile to help them manage their finances, inventory, assign and monitor tasks, harvest and profit accounting.”
The team is currently preparing to launch their 5-acre pilot farm in Negeri Sembilan, and already have 7 Letters of Intent signed and 47 undergraduates from UPM with registered interest.
They’re in the midst of raising RM4.5 million for their pilot 5-acre farm, and Kelveen has identified their breakeven being at 25-acres and a strong profit position being at 50-acres.
Planting The Seeds Of Co-Farming In SEA
“Our vision is to see 5,000 acres of co-farms across ASEAN within 10 years, where over 4,000 agropreneurs can start their own modern smallholder farm business, which in turn hires over 8,500 farmworkers from the local community,” Kelveen said.
They’ve already identified 3 agropreneurs, and to bring in more, they’ve engaged the Malaysian National Farmers’ Authority (LPP) with its database of about 190,000 registered farmers between 20 to 40 years old.
But that’s just one of the ways, with others including programmes of tertiary educational institutions, partner universities, farmers associations, and through word-of-mouth within their own professional community of farmers in Cameron Highlands.
In terms of adding value to their services, the Fefifo team is currently partnering with UTM to embark on a Deep Tech research project that’s focused on developing a new predictive analytics system.
This system will enable financial inclusion for farmers with machine learning and AI applications developed from multifaceted big data of live farming activities.
“Ultimately, this new predictive analytics system will bring significant benefits, sustainable value and game-changing opportunities to the key stakeholders in smallholder financing across ASEAN,” Kelveen described.
Featured Image Credit: Fefifo