Peter Njonjo is the Africa regional honoree for the 2022 YPO Global Impact Award. The award focuses on YPO members making impact outside the organization that is both sustainable and scalable, affecting people, prosperity, peace or our planet.
Peter Njonjo has spent his career achieving corporate success. Employed at Coca-Cola since age 22, he’d worked his way up to become the President of the Lagos, Nigeria-based West and Central Africa Business Unit, made up of 33 countries.
But by the time he reached this position, he had been contemplating an important question for some time: What kind of legacy was he leaving behind?
“I knew a lot of people were struggling with very basic needs in Africa,” he says. “I asked myself, how could I leverage my knowledge to help lift people out of poverty? Wouldn’t that be something worth investing the rest of my life in?”
So, in 2014, Njonjo, along with Co-founder Grant Brooke, launched Twiga Foods. A B2B e-commerce marketplace, Twiga simplifies the food supply chain between fresh food producers and fast moving consumer goods (FMCG) manufacturers and retailers. The company essentially cuts out unnecessary intermediaries from the supply chain, and in return, the cost of food decreases for local consumers, and other sectors of the local economy can grow.
I want to showcase to the rest of the world, especially in Africa, that doing good is good business. That is what really excites me in terms of the impact we can have as a company. ”
— Peter Njonjo, Africa regional honoree for the 2022 YPO Global Impact Award share
Understanding the need
When Njonjo and Brooks first conceptualized Twiga, they saw an opportunity within fresh produce value chains. Their idea was to focus on exports, remove inefficiencies, and then scale. But they soon realized how fragmented and informal farming and the food supply chain were in Kenya and in most of Sub-Saharan Africa.
“There was no record keeping, and there were a lot of post-harvest losses,” says Njonjo. “We realized we couldn’t get the quality we needed for exports and that there was this bigger problem that needed to be solved. We’d need to do more work locally to build those value chains within the retail market.”
The inefficiencies Njonjo uncovered have massive impact, especially compared to Western markets. While consumers in the United States spend, on average, 7% of their disposable income on food, and Europeans at 8-10%, food takes up 50-60% of the average African’s disposable income because of this broken system.
“When you go to the U.S. you see where that income can go. The other 93% is found in transportation, health care, real estate, and all the other services people are consuming today,” says Njonjo. “But in Africa, it’s very difficult for economies to modernize when you still have a significant amount of money going to very basic things like feeding yourself.”
Njonjo’s region is also unique compared to global standards because big retail chains and box stores largely don’t exist.
“A lot of folks can’t grasp the concept that mom and pop stores account for 90% of retail in Kenya. They ask where our big supermarkets are and I have to tell them, ‘We don’t have them,’” he says, laughing. “So, this is about finding solutions to local problems you can’t necessarily transfer from other markets. It makes the work exciting for me.”
Twiga’s solution was to create one, easy-to-access place where producers could sell their goods and where retailers could access all the products they need without having to go through multiple channels.
Through their e-commerce platform, vendors can place orders and get direct deliveries within 24 hours. Producers can upload their goods and interact directly with Twiga’s team. Since launch, the Kenyan company has sourced from more than 10,000 farmers. Currently the platform stocks more than 1,000 different products, and they have about 130,000 registered customers using their services across 13 cities in Kenya. Every day they deliver more than 600 metric tons of products to more than 12,000 retailers.
Of course, their platform could only succeed in an economy embracing technology. Fortunately for all parties involved, that was increasingly the case.
A more connected commercial sector
“I think Africa is going through a very interesting transformation right now, but I think that’s sometimes hard to see from the outside,” says Njonjo, referring to rapid technological advances.
He points to the advent of WhatsApp for forcing the hand of telecommunications companies to upgrade networks to 3G, 4G or higher, creating an increase in smartphones sales, and by default, driving down their cost. This change had real world implications for Twiga: In June 2020, just 10% of their revenue was going through their mobile app. By November 2021, that increased to 75%.
Twiga also implements technology to address another local logistical barrier: The mom and pop retailers in places like Nairobi do not have zip codes or addresses. Instead, Njonjo and his team have turned to another tech tool — Google Pins. “That’s basically how we’ve built our whole logistics business,” he says. “Today our delivery tracks individually cover enough distance to go around the world every three days.”
And while many startups may refrain from heavily investing in assets, Twiga does not have the same luxury. Njonjo explains that most developed countries have built their e-commerce layer on top of an already fairly sophisticated retail layer, leveraging infrastructure that has been around for 100 years or more.
“Right now, we are building an e-commerce layer where this sophisticated retail layer does not exist,” he explains. “So, we have to figure out a way in which we can also build infrastructure that gives us the same supply chain advantage as other e-commerce players.”
So I asked myself, how could I leverage my knowledge to help lift people out of poverty? Wouldn’t that be something worth investing the rest of my life in? ”
— Peter Njonjo share
The company is currently commissioning their first 200,000-square-foot distribution center, the first of its kind in the region. “We have to invest in infrastructure due to deficiencies in the market, but this also unlocks a significant upside,” he says.
Outside of infrastructure, the company is getting into the production of their own produce. In late 2021, Twiga announced a USD50 million Series C round to scale their efforts in Kenya and other countries in East Africa. They’ll use the funds on a 2,000-acre farm where they are improving crop yields using precision agriculture and satellite imagery.
Njonjo shares that while innovation in the domestic food supply chain might have lagged in his home country over the past several decades, sophisticated farming has been around for a while in the export-oriented agricultural sector. Kenya maintains a large portion of the global market share for flowers and horticulture, exporting to big entities and corporations regularly and de-risking the supply chain.
“We said, ‘look, we need to have a proof of concept that you can actually produce for the domestic market leveraging technology being used commonly in more developed markets,’” says Njonjo. “What could our impact be if we produce enough to get into our local market in Kenya?”
Through their proof of concept, Twiga is working to reduce the amount of loss from the time crops are planted to how they are monitored, harvested and packaged before getting to market. Njonjo says he is confident that throughout the year, their produce will be 30% cheaper than the rest of the market.
Creating a culture
Though Njonjo co-founded Twiga, for the first five years, he continued on at Coca-Cola and advised the startup from a position on the board. When he stepped in as CEO in 2019, the transformation from corporate to startup was an adjustment.
“The rate of change of a mature company like Coca-Cola is much slower, and that’s reflected in the type of leadership that you have. There’s less experimenting and more of a focus on strategy and execution,” he says.
In the corporate world, incremental growth like 5% can be unbelievable he says. In contrast, from April of 2019 to December of 2021, Twiga increased their revenue 14 fold. “It’s like you’re running a different company every quarter,” he admits.
This growth trickled into talent management as well, where employees quickly move from a position where they are a leader of self to a leader of leaders. A year-long process where Njonjo reviewed every position from C-suite down, rewrote job descriptions, issued capability test and most importantly, spoke with his employees about their needs and how they aligned with the company’s mission, helped him address inefficiencies within Twiga just like they were doing in their sector externally.
Today, Twiga employs more than 1,000 people, 800 of which work year-round.
He based his restructuring efforts around four main values: putting customers first, accountability, keeping things simple despite the complex issues they are addressing, and always working compliantly and in good faith.
In the next 10 years, Njonjo wants Twiga to help lower food prices across urban cities on the continent by 10-15%. He estimates in Nairobi they will achieve that in the next year, but he knows his efforts can go further.
“I want to showcase to the rest of the world, especially in Africa, that doing good is good business. That is what really excites me in terms of the impact we can have as a company.”