Is this traditional capitalism?

 

We have been trying to raise support for our intended agro-processing plant since 2015, in vain. During that time, people have asked if our intended plant, or the UCF’s designation as a “social enterprise”, isn’t capitalism, and if not, what makes it not?

 

The short answer:

No. This isn’t capitalism. Our intended ownership structure for this plant explains that.

 

The long answer:

Our idea for having this plant is based on universal need, or communal need, per our local context: addressing the main challenge that keeps every rural smallholder farmer in our region in extreme poverty, i.e. the absence of reliable markets for our produce.

Our only goal is to catalyze self-sustainability, in a place where there is simply nothing else that is happening to end extreme poverty, not to mention that this plant is being fronted by people who are ourselves only emerging from the direst forms of poverty.

This isn’t really capitalism. All that we are after, is a way of putting the ultra poor on a self-sufficient path from poverty, and a means of doing so in a self-sustainable way.

 

The social enterprise part of it?

The UCF’s business model is that of a pure nonprofit, in that all the support that we provide to the farmers we work with (be it seed, tarpaulins, training etc.) is entirely free, but a nonprofit with a business approach to putting the poor on a self-sufficient path from extreme poverty, hence our designation as a “nonprofit social enterprise”.

And while it is generally assumed that most “social enterprises” operate by turning a profit from their constituents, the only social enterprise aspect in our work is that the UCF is constantly looking for ways to ultimately make our overall work self-sustaining, but without making our participating farmers pay for anything, or repay us in any way.

This is very crucial in an environment like ours, where it is virtually impossible for people like us to find support for our work. Today, according to CIVICUS, only 1% of all the money that is intended to end global poverty, i.e., only 1% of all Official Development Assistance (funding from agencies like USAID, UKAID etc), and an even smaller (<1%) portion of all humanitarian assistance (all charitable global antipoverty funding included), is what goes directly to the extreme poor in the global south.

 

A look at our preexisting community work, and our business model:

Since the UCF was launched in 2014, we have implemented two major community projects: ginger in 2014 – 2017, and our current sorghum project, as you can see from photos on this website. In both projects, we have worked together with hundreds of rural poor smallholder farmers, and have provided these farmers with 4 tons and 1.2 tons of ginger rhizomes and sorghum seed respectively, all free, besides hiring a field team that works with these farmers from initial orientation, through to harvesting.

But, if you look at a Seed Delivery Note that each farmer signs when receiving seed from us, it says “…the UCF also commits to helping this farmer get a market for their produce at harvest. If the farmer isn’t comfortable with the price that the UCF has been able to find, and would like to sell their produce elsewhere, they are free to do so. In that case, the UCF owes nothing to the farmer and, in all cases, farmers also owe nothing to the UCF — whether or not their produce was sold through the UCF.

That’s, farmers are NOT supposed to repay the UCF for the seed or any other inputs like tarpaulins, technical training, or assistance in finding a market for their produce.

Similarly, if you read the envisaged Business Model for our intended agro-processing plant, which you can access by hovering over “Action Plan” on this website, you realize that our only goal is to give the extreme poor a hand-up, while developing business models that will put these people on a self-sufficient path from extreme poverty.

Again, this isn’t really capitalism. It is just the only way we can end extreme poverty.