BY Wasilat Azeez
Agritech crowdfunding platforms have appealed to their investors to give them adequate time to pay returns.
In the past couple of months, there has been a rise in the number of social media complaints of agritech companies owing investors.
In a statement on Monday, Crowdyvest, an agriculture platform that allows Nigerians to venture in and sponsor agriculture, said it has embarked on a debt recovery process to enable the refund of overdue payments.
Founded in August 2019 as part of EMFATO Group — the parent company of Farmcrowdy and Treepz (formerly Plentywaka), Crowdyvest said it fully exited EMFATO Group in March 2021 through a debt acquisition agreement where it acquired Farmcrowdy’s debt at the time.
Explaining the reason behind delayed payments to investors, Crowdyvest said it was due to the acquired debt from Farmcrowdy and payment defaults from its impact partners.
“In retrospect, the choice of the debt acquisition model was ill-advised as our projections to onboard equity investors and long-term financing did not yield anticipated results,” the statement reads.
“A combination of the acquired Farmcrowdy debt and the ongoing defaults by our impact partners has now led to the inability to pay all monies plus interests that should accrue on the monies received via the platform.”
The platform said it had hired independent consultants to audit its operations while defaulting partners have received demand notices to hasten the payback process.
It added that deposit and withdrawal options on the platform have been disabled to ensure that no new deposits are credited into the system –while complete attention is paid to the debt recovery and payout process.
“We recognise that this development will significantly affect your plans for the year and beyond, and we sincerely apologise for this,” the statement adds.
“While we are in no position to dictate how you react to this notice, we plead that you give us enough time to explore all available options to get monies owed from defaulting partners which in turn will allow us to effect immediate payments.
“Legal and regulatory demands at this time will delay this process which will prolong access to monies owed.”
Crowdyvest said it would hold a town hall meeting for members and stakeholders on February 13, 2022, adding that further details on the meeting will be communicated.
Agropartnerships, another agritech company, also sent an apology mail to investors after a town hall meeting to address the issue of delayed payments.
“We have done poorly with communications in the past. Our resolve is to upgrade the quality of communications as well as its frequency to keep Agropartners intimated on our progress. We will be ramping up our capacity in the areas of customer communication channels, personnel and communications technology,” the statement reads.
“Several factors including global supply chain challenges and processing machinery breakdowns have contributed to our operational downtimes.
“We are working hard to strengthen our processes, upgrade our technology, and have brought experts onboard to drive this new phase.
“Our next virtual meeting with the Co-CEOs will be on Friday, February 18, 2022. We hope to update you on progress made and address any further concerns you may have.”
This is not new to the agritech environment in Nigeria as they faced numerous challenges such as insecurity, COVID-19 induced supply chain disruption, mismanagement and lack of transparency from founders. In 2021, Thrive Agric, another agric-tech company, announced a gradual refund of investors’ overdue payments a year after the company experienced financial hardship.
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