One Acre Fund (1AF) is an innovative, nonprofit organization dedicated to helping smallholder farmers in sub-Saharan Africa improve their yield, increase their income, and build sustainable food supply and livelihoods.
In 2024, Natural Investments finalized its due diligence of 1AF and added its Notes Fund as our newest investment open to clients looking to make direct impact on the lives of smallholder farmers—those farming on five acres or less—who are some of those most exposed to extreme poverty and the effects of economic disinvestment and climate change.
As part of our due diligence process, I visited 1AF’s Rwanda program, known as Tubura, which means “to grow exponentially,” where I was able to see the impact 1AF has had on Rwandan farmers and the country’s development at large.
THE ONE ACRE FUND APPROACH
Farming techniques and knowledge have come a long way in the last 100 years, but small, rural farmers in the Global South often don’t have access to the resources necessary to implement these innovations. That’s where 1AF comes in.
“It’s not about inventing more agricultural technologies,” said 1AF’s founder, Andrew Youn, in a 2017 Skoll Foundation video. “The technologies we needed were invented a century ago. It’s about distributing those technologies and getting them into people’s hands.”
Trying to connect smallholder farmers to these innovations isn’t a revolutionary idea, but the way 1AF is doing so is. For rural smallholder farmers, standard methods of disseminating agricultural techniques and inputs doesn’t work.
1AF is working to bridge this gap by providing culturally sensitive and environmentally responsive training, inputs, and market access. Through its Notes program—which allow investors to put money toward directly supporting farmers with an up to 3.5 percent return—1AF has supported its client farmers to significantly increase yield and soil health.
THE FOUR STEPS IN THE ONE ACRE FUND’S APPROACH ARE:
1. 1AF employs local farmers as Field Officers who act as a nexus for individual farming communities, disseminating training and farming inputs from 1AF to fellow farmers in their area. They act as an educational resource for their fellow farmers and provide 1AF direct insight into the needs of their communities.
2. 1AF’s loan program provides very small-scale loans to farmers in the form of real inputs, like fertilizer and specialty cross-bred (non-GMO) seeds tailored to local climates and conditions. Farmers can even use the loan program to buy things like cell phones, which allow them to more easily connect to the market, their community, and make orders via the organization. These loans are then repaid over the harvest season, allowing farmers to repay loans at a time when they have the most excess, unlike traditional loan programs with set repayment dates that do not necessarily align with the growing seasons.
3. 1AF brings inputs directly into farming communities. This “last-mile delivery” allows even the most rural farmers to be able to access needed inputs by foot, removing the need for them to figure out the logistics of getting inputs to their farms.
4. 1AF helps farmers connect with markets—in some cases even buying high-value crops directly from farmers—and purchases farm input insurance on behalf of its farmers. This provides guaranteed markets and assurance in the case of natural or financial disasters for farmers.
Though 1AF’s operating costs are supported by donations, its relationship with farmers is not one based on philanthropy. This philosophy was at the center of 1AF’s founding for Andrew Youn.
“Every farmer that we serve pays us for the services they receive. If I’m an aid recipient, I have to take whatever is given to me, and I have to smile and accept that. But if I’m someone that pays for services, I become a customer all of a sudden, and you know as the saying goes, I become the king,” Youn said. “And so, what we find in our organization is that sometimes we roll out a new product or service and nobody buys it and that’s a great indicator that we have not satisfied our customers’ needs.”
Seventy percent of 1AF’s core program costs are covered by farmer repayment and farmers repay roughly 97 percent of all loans.
THE ONE ACRE FUND IMPACT
Since its inception, 1AF has made a significant impact on smallholder farmers in sub-Saharan Africa. The organization currently works with more than 4.8 million farmers across nine countries: Rwanda, Kenya, Burundi, Malawi, Tanzania, Nigeria, Zambia, Ethiopia, and Uganda.
The results, reported in 1AF’s 2023 Annual Report, reveal several positive benefits:
- Increased yield: During the “hunger season,” veteran clients are 52 percent more likely to have maize remaining from the previous harvest to feed their families, and farmers who work with 1AF often see their crop yields increase by 40 percent.
- Sustainable farming practices: Veteran clients apply 25 percent more organic inputs to their fields (via crop residues, compost, and/or manure), which is key to healthy and resilient farmland. In 2023, 1AF supported over one million farmers in adopting at least one soil health practice, such as reducing soil acidity via agricultural lime, applying compost to their fields to increase organic matter, or undertaking erosion control practices.
- Improved incomes: One-year veterans have accrued 13 percent more total asset wealth, and three- to five-year veterans have accrued 25 percent more, indicating compounding reinvestment of annual gains.
During my September 2024 visit to Tubura, I saw the direct impact 1AF has had on Rwandan farmers. Tubura is one of 1AF’s first and largest programs and acts as a hub for much of its operations. To date, Tubura is estimated to have worked with an astounding 95 percent of all smallholder farmers in Rwanda at some point through its 1,840 Rwandan Field Officers. Tubura is on track to meet its goal of working with one million Rwandan farmers in 2024.
Though Rwanda is a small country, it has a diverse ecology, and farmers have geographically specific needs. To support this, Tubura employs experts who test and implement new seeds, methods, and crops across the country’s three climate regions: mid-altitude, mid-altitude dry, and high-altitude. Innovations and testing ideas either come from 1AF/Tubura experts or, in many cases, from the farmers themselves. Farmers are able to talk with their Field Officers and local Tubura staff about issues and use cases they have, then those comments are fed back into Tubura’s R&D program.
As one of 1AF’s most well-established programs, Tubura has also become a testing ground for 1AF’s efforts to continue to expand its impact. Traditional crops for smallholder farmers are designed for short-term consumption and profits, but to ensure the continued prosperity of communities, work needs to be done to support more long-term asset accumulation. This is where 1AF’s relatively new tree program enters the picture. In 2023, 1AF equipped farmers in nine countries to plant more than 74 million new trees. 1AF is working to equip farmers with one billion trees by 2030. Planting trees alongside crops (also known as agroforestry) provides both long-term economic gains in the form of more profitable fruit, crop, and timber harvests, and climate resilience in the form of improved soil health and carbon mitigation.
THE ONE ACRE FUND VISION
1AF’s vision is to continue expanding its reach to even more smallholder farmers, aiming to increase the number of farmers served to 10 million by 2030. With a strong emphasis on evidence-based solutions, the organization is constantly refining and expanding its programs to ensure maximum impact. This includes increasing the range of crops it supports and expanding its reach to new communities and countries.
In addition to direct support for farmers, 1AF advocates for systemic changes to the agricultural sector in Africa. By partnering with governments, agricultural institutions, and international organizations, 1AF works to strengthen the overall agricultural ecosystem, improving policies, infrastructure, and market systems for smallholder farmers.
Currently, sub-Saharan Africa is a food importer. But it has the capacity to become the breadbasket of the world, and 1AF is committed to working with smallholder farmers to ensure Africa’s agricultural future. To learn more about 1AF and to donate to its mission, please visit its website at oneacrefund.org. If you’d like to learn more about 1AF’s Notes, speak with your investment advisor.