Jacob Ugbodaga is a serial social entrepreneur with a strong passion for innovation and entrepreneurship. His passion to reduce food waste and provide value for more farmers led to the launch of KipitFresh, a cold storage technology, for the proper preservation of food nutrients and reducing contamination.
In this interview with Founder Africa, Jacob Ugbodaga speaks to us about his journey to entrepreneurship amongst other things.
FA: Tell us about you and your background
Jacob: My name is Jacob Ugbodaga, and I’m an entrepreneur that enjoys finding solutions to issues that are immediate, visible, and have a direct impact on people’s lives.
I hold a degree in computing and have always had an entrepreneurial spirit. After graduation, I got my first job as a product champion for a tech firm where I sold CRM applications to business clients. During my NYSC in Lagos, I used to buy fruits on my way from work either
carrots or garden eggs. When I finally sat down to plan a business, I looked around for what I could do. Yes, I have a certificate in computing with a core specialization in database management, web application, and software engineering, but I wanted to do something closer to me. I wanted to pick a part of my lifestyle and turn that into a business. That was when it occurred to me that for every part of Lagos, there is a Hausa guy or Mallam as we fondly call them who sells fruits.
As a child, I used to ride big buses termed “molue” and in it, people would market medications that could treat ailments like diabetes and other conditions. If COVID was in existence then, they would have claimed that it also worked for it. However, people have become more enlightened, they began getting health checks, checking their blood pressure, and becoming more health conscious. I believe that this also fueled the need for people to start eating organic fruits.
My co-founder and I launched a fruit juice bar called “ALABASTER” in 2018 and we were aiming for young folks so that they could genuinely live a healthy life from a young age rather than having to wait until they’re sixty or seventy. We focused more on prevention than on treatment, so if you can live a healthy life by eating natural fruit, this will help to prevent most health problems. We started with young individuals; the majority of our clients were between the ages of 18 and 25.
We started facing difficulties somewhere along the line. The first was the problem of obtaining raw fruits; we had to go to the open market and spend about three hours daily because different varieties of fruits were sold at different sections of the market. Also, we had to pay some individuals in the market to help carry the items.
Sourcing was the number one challenge. At the market, we discovered that the fruit vendors have not sorted their products. As a result, we must use our hands to sort the good fruit from the bad. Also when I buy from Trader A, I have to pay a fee for the “ground” which increases the purchase price and so on. That’s where the notion of KIPITFRESH was born. The goal is to help improve fruit storage and distribution in the country; let’s store and sort for people like us, especially people who manufacture juices. That’s the story behind the idea and how I entered entrepreneurship.
FA: How does KipitFresh work?
Jacob: KipitFresh is an agri-tech company. Our main goal is to enhance the distribution and storage of fruits in Nigeria. Recently while I was speaking somewhere, I mentioned that if fruits could speak, they would express their desire to live longer.
Typically, a farmer harvests the fruits and keeps them in an open field exposing them to harsh temperatures. The middleman then goes to the market to buy and haggle for a ridiculous price. The middleman then transports the fruit in an open truck for 600–1,000 kilometers, which further exposes them to harsh weather conditions of rain and sunshine, causing them to deteriorate further in quality. Therefore, when the middleman finally arrives at the market, a lot of the fruits are discarded. In my estimation, roughly 50% of the fruits produced in Nigeria are discarded as waste, therefore we’re attempting to solve this problem.
From the farm kipitfresh has what we call a mobile refeer, which is a cold box or temperature controlled room, we dispatch it to the farmers so the farmers can store their fruits in the temperature-controlled box once they harvest. We don’t stop there; we also give access to buyers, bulk buyers who have already placed online orders for many of our sales, and supply down to our bulk buyers. This is a big change because it means that the fruits are kept refrigerated in temperature-controlled trucks all through the supply chain. Therefore eliminating losses and lengthening the life span of the fruits.
In a nutshell, Kipitfresh provides on-demand fruit storage and distribution of fruits and vegetables.
FA: Have you gotten positive reception, especially from the farmers?
Jacob: We just finished doing the pilot phase and, just like every new system, the acceptance is good but the players will always want to react rather than respond. So, the players most times are the retailers in the city, you hear things like; why should the fruits be chilled if you are not exporting outside the country or why should the fruits be packaged? So there has to be more education from us.
About 90% of fruit dealers in some places in Nigeria prefer to sell fruits that are over-ripened and almost spoilt, and the argument they give is that it’s sweeter. Although we continue to speak with the players, we are aware that they still require more education because some people think the status quo should continue. For instance, some people think that a mango that is over-ripened or almost spoiled is preferable to one that has been kept in a temperature-controlled environment. More education still needs to occur and I think with time, there will be more change in fruit dealers’ practices and consequently consumers’ preferences.
FA: Kindly share your highlights or major milestone so far.
Jacob: We are in partnership with USADF, who currently work with us to ensure that we incorporate more farmers into our platforms — we presently have between 500 and 1,000 farmers — which is our major highlight.
The second highlight will be changing the narrative of how fruits are stored, it will be very good if from now on someone can order a box of fruits e.g I want 500kg of mangos, and can be delivered at the point of sale.
Another milestone is the debut of our 5-ton mobile reefers, which have a daily capacity of around 5000 kilograms, and our 10-ton refrigerated trucks, which can transport roughly 10,000 kilograms of fruits. These are the little milestones we have achieved and we look forward to more.
FA: Does this service work outside of Lagos, Nigeria? Are there plans for expansion into other African countries?
Jacob: Due to the model, we wanted to push the pilot phase to Lagos. As a result, we are currently working on a large model where we are selling fruits in bulk rather than to a single customer. If a customer wants two boxes of watermelons, we can sell them to them, but selling individual pieces may be more challenging. Abuja is our number two point of expansion. We have heard that there are many fruit markets and that many people consume fruits, so we should definitely move there, but for now, we only have a base here and we’ve been opening fruit juice bars where we offer smoothies, juices, and other drinks.
Recently, my co-founder and I were talking about Rwanda in East Africa; I believe he had done some research on the country.
We are also talking with a few business owners who have successfully expanded into the African markets, and one of their arguments is that a business like ours has easy access to the road, making it possible to move from one country to another the same way we move from one state to another. This is something we are looking into, and with the investment that is coming our way, we are confident that we will be able to expand.
FA: Have you raised funding?
Jacob: Yes, we received some funding from the USADF. They provided us with a grant and offered us access to other investors. A large portion of the current assets we have was bought thanks to the funding and complete partnership with the USADF.
FA: What is that unique selling point that differentiates KipitFresh from other competitors?
Jacob: There are a few factors, one of which is that our storage system is dynamic. Some cooling brands construct these cool rooms in a static location and require that farmers bring the goods they wish to store, so the farmer is required to bring the entire harvest to the storage facility. In addition to the expense, one issue with transportation is how to carry large volumes of fruits from the farm to the storage facility.
Fortunately, our storage boxes are mobile because they have wheels, and we can drive to the farm to pick them up. The farmers do not necessarily come to us, we go to them.
Also, we provide a platform for them to sell because we realized they are entrepreneurs and want to sell too. We can make that happen because we have access to the market and sales channels. As a result, we create mobile cold storage for them and are also able to sell their products on their behalf. On our most recent trip, we were able to deliver 11,250kg worth of fruits to Lagos.
Also, we have an excellent relationship with our farmers since we visit their farms rather than just sitting in a big office. I’ve been to some farms where I was concerned about my safety because of the distance and location. I was on a farm once last year and I rode on a motorbike for about two hours through a forest with nothing but trees for company. When I arrived, I discovered the potential clients we had met along the way were foreign nationals so they couldn’t speak English. We just try to establish a direct rapport with the farmers.
FA: How do you see the company in the nearest future? Or what are you looking at?
Jacob: For us, we want to be among the top on-demand cooling service provider in Africa. As a smoothie lover, one of the reasons you can’t get a smoothie on the shelf is that the smoothie expires in 24 hours and then the juice expires in three to five days if it’s not frozen. The first layer of the business was to open juice bars that are still existing today. You need to come and taste our smoothie; when we started, people loved our smoothie even until last night, we supplied 30 bottles of cold-pressed juice (natural juice) to a client.
The question then becomes, how can we improve the process to ensure that this product remains natural for a longer period? This is where we come in; with the cooling method, we can truly observe that this product can stay longer without any damage, chemicals, or additives. Also, we can enhance how fruits are generally distributed and stored.
I am looking forward to the day when I can walk into a store in my production center and have a catalog where I can order a variety of fruits like 60kg of avocado, I want 30kg of mangoes, I want 10kg of apple and I can get it immediately or I can pick them right off the shelf in contrast to what is happening now because the market is currently chaotic.
FA: Can you tell us some challenges founders face while trying to scale in Africa?
Jacob: I believe that access to infrastructure is the first challenge founders may face when attempting to scale. We discussed how prevalent the internet is, how software is integrated, and how scaling issues with technology may be an issue for us. For instance, the cashless policy between the CBN and the government. When I went to the market a few days ago, I found that the majority of people still need access to actual cash since they still find it difficult to conduct cashless payments.
Therefore, access to infrastructure, technological infrastructure, digital infrastructure, and even physical infrastructure are some of the problems.
For us, for example, entering some of the farms can be challenging. There are farms where we have to find another way to access them because the location is not motorable, as I mentioned earlier last year when I had to visit a fruit farm and had to travel there on a motorbike for two hours because the roads weren’t motorable. Those are some of the challenges a founder will encounter as they grow their business.
The second issue is strong partnerships. I believe that in Nigeria, there is a lack of trust and commitment to partnership. I believe it’s simpler in developed nations where you might see a startup come up with a solution and then one established company works in partnership from the pilot to the implementation stage. I frequently observe this in the food industry in developed societies where one startup comes up with a solution, runs a pilot, and expands rapidly with the help of an existing brand. But here in Nigeria, several established companies still find it difficult to partner and allow startups to flourish under their brand.
The third challenge is funding and access to capital; I believe we are still underfunded. For instance, I recalled how when we used to discuss the concept of storage and distribution, and once you tell the people we want to buy a truck, you hear oh! You can leave, not directly but things like; we don’t fund physical assets but the reality is if we don’t have a physical asset, the software will be floating on water so, in most cases, we don’t have the infrastructure already existing so we have to find funding to purchase mobile reefers that would go to the farm and the trucks that would go to the urban areas for distribution.
So, I think access to infrastructure is number one, a strong partnership is number two, and access to finance is number three.
FA: Growth versus profitability which do you think a founder should focus on more?
Jacob: I would look at growth because eventually, the startup will take a while before it becomes profitable. Is there a way I can open more centers? Is there a way I can get more trucks? Is there a way I can get more farmers integrated into our platforms? So, I think growth is key.
I was reading recently that there’s a food crisis in the UK to the extent that when you get into a store now, you are only permitted to buy three fruit items. When you look at Nigeria today, you will see dozens of fruits wasted in the market, so we need to look out for ways to export these fruits that are commercially needed.
I believe in growth, we can expand, and reach more people and I believe if the investor is patient enough, it will turn into profit.
FA: Aside from work, what do you do for fun?
Jacob: That is a fantastic question. When I’m not working, I’m either tweeting, conversing, or doing this. Politics is one of my passions, and I enjoy using Twitter a lot. Conversations show perspective, which I believe can construct a new way of reasoning and also ignite a flame in various fields, such as business, politics, and more. I believe I spend more time talking to individuals outside of work and learning about their opinions and thoughts. I volunteer at a church and spend a lot of time leading children in bible study. I also serve as the teens’ choir coordinator and like listening to wonderful music. Hence, I am either at a fellowship, a choral practice, or just hanging out on the bird app.
FA: What’s your favorite Nigerian dish?
Jacob: First, I will confess; I have not experimented a lot when it comes to food. I was born in Lagos and I have not been able to travel around the country yet but, the one that tops them all is pounded yam and groundnut soup and it can change very soon.
FA: If someone told you, you would be doing this now, what would you have told them?
Jacob: It would have been a resounding “No!” if I had responded to the question. Growing up, I had to spend a lot of time in the market—at least three hours—accompanying and helping My Mother with shopping for foodstuff. She had particular vendors that she usually patronized. One of the trends I noticed was that they were scattered at different locations within the market and never had a fixed price. For instance, if she bought a piece of an egg for a hundred naira last week, the next week the vendor would change the price. My Mom will have to bargain for a lower price and there’s always an argument before the final price is reached, then we would have to move to the other end of the market to buy yam or something else. So, I didn’t like the marketplace because it felt cumbersome and tiring. I really didn’t like it at all so even if someone told me I would have said ‘no’. Sometimes, you thrive in places you think you do not love. I think I now understand the system better.
FA: Thank you very much for your time.
