BIP: Business more than usual

adminAnnual Report 2015, Strategic initiatives0 Comments

Packing aflasafe at the manufacturing plant in Ibadan, Nigeria. Photo by IITA

Packing aflasafe at the manufacturing plant in Ibadan, Nigeria. Photo by IITA

IITA’s Business Incubation Platform (BIP) supports the Institute’s strategic goals and accelerates the commercial development of its proven and profitable R4D technologies, ensuring close alignment with R4D, the institute’s research arm. BIP focuses on two avenues of commercial development: the creation of innovative and commercially-viable products by IITA scientists, and the initiation and building of a network of public and private-sector partners that will support the activities of small to mediumscale agribusiness entrepreneurs, initially within Nigeria and, later on, elsewhere.

In 2014, the Board of Trustees conditionally approved business plans for each of the initial start-up agribusinesses of BIP: GoSeed, NoduMax, and Aflasafe; and committed funding for BIP’s establishment. An IITA/BIP Advisory Council was then created to provide guidance and oversight of BIP’s establishment and operation, and the feasibility of its financial performance. Additionally, IITA received legal confirmation of BIP’s status and approval of ongoing operations, and a CEO, Frederick Schreurs, was recruited late in 2015 to build and grow BIP.

BIP business start-ups: roaring on

Aflasafe

In 2015, Aflasafe contributed US$487,000 to the profits of BIP, while sales of the product came to about US$597,000. This figure is more than double its sales of US$291,000 in 2014. The business has so far received orders amounting to US$881,000 for delivery in 2016. In terms of infrastructure development, construction of the second Aflasafe factory in Africa—in Kenya—has been started while plans are underway for the construction of three more factories in Senegal, Zambia, and Kenya. During the year, Aflasafe also received a Certificate of registration from the National Agency for Food and Drug Administration and Control (NAFDAC) in Nigeria that is valid until October 2019.

In the beginning of 2015, Aflasafe entered into the initial stage of discussion with global and local agribusinesses for technology licensing/commercialization. Aflasafe was also cited for helping minimize aflatoxin contamination in Kenyan maize and received final sales payment from the Kenyan Ministry of Agriculture and the Kenya Agriculture and Livestock Research Organization (KALRO). Negotiations have also been started with various private sector enterprises for different aspects of commercialization:

  • Maslaha Seeds (http://www.maslahaseeds.com/) – manufacturing, distribution, and marketing.
  • Flour Mills of Nigeria (http://www.fmnplc.com/), the largest food/feed processing company in Nigeria – distribution and marketing.
  • Dizengoff Nigeria (http://dizengoff.com/agriculture/) –distribution and marketing.
  • Penyl – Mothergold Consortium –leasing the facility in Ibadan and marketing and distribution.
  • SartPartners (http://sartpartners.com/) – manufacturing, distribution, and marketing
  • Elephant Vert (http://www.elephantvert.ch/), a company known for solid state fermentation and biopesticide manufacturing – manufacturing, distribution, and marketing.
  • Dow Agrosciences
  • Cargill
Packing the bioinoculant NoduMax, BIP, IITA, Ibadan. Photo by O. Adebayo, IITA.

Packing the bioinoculant NoduMax, BIP, IITA, Ibadan. Photo by O. Adebayo, IITA.

NoduMax

In 2015, 30,450 packets of NoduMax were produced and sold for US$90,000. A few large companies such as Notore and Nigeria Flour Mills and many other smaller companies have placed orders for the 2016 June planting season. We are planning to produce 110,000 packets in 2016 with a projected income of about US$330,000. In November, NoduMax received regulatory approval from NAFDAC. With this, BIP will undertake a major marketing campaign of the product in 2016.

GoSeeds

During the year, through various projects funded by the Government of Nigeria and other donors, approximately 120 tons of high quality breeder and foundation seeds of maize produced by IITA were given to seed companies in Nigeria either for free or at highly subsidized rates. GoSeed sold about US$5,000 worth of seed in 2015.

Income in 2015

The actual net income for BIP in 2015 is about US$380,000 (see tables). Table 1. Actual cash flow (net income each month) ($) for BIP in 2015 (reported during BoT Nov 2015).

 

January February March April May June
Nodumax (24,571) (33,938) (22,100) (6,653) (6,730) 47,049
GoSeed (2,714) 107 237 (1,483) (57) 0
Aflasafe 0 0 36,890 (21,926) 0 45,648
AgriServe 0 0 0 0 0 0
Total (27,285) (33,831) 15,027 (30,062) (6,787) 92,697

 

July August September October November December Total
Nodumax (5,246) (8,050) (45,241) (5,597) (5,597) (6,622) (123,296)
GoSeed (2,714) 107 237 (1,483) (57) 0 19,618
Aflasafe 0 0 36,890 (21,926) 0 45,648 487,006
AgriServe 0 0 0 0 0 0 0
Total (27,285) (33,831) 15,027 (30,062) (6,787) 92,697 383,328

 

Table 2. Actual cash balances (at the end of each month) ($) for BIP in 2015 (updated at BoT Nov 2015).

 

January February March April May June
Nodumax (24,571) (58,509) (80,609) (87,262) (6,730) 47,049
GoSeed (2,714) (2,607) (2,370) (3,853) (57) 0
Aflasafe 0 0 36,890 14,964 0 45,648
AgriServe 0 0 0 0 0 0
Total (27,285) (61,116) (46,089) (76,151) (6,787) 92,697
July August September October November December
Nodumax (24,571) (33,938) (22,100) (6,653) (6,730) 47,049
GoSeed (2,714) 107 237 (1,483) (57) 0
Aflasafe 0 0 36,890 (21,926) 0 45,648
AgriServe 0 0 0 0 0 0
Total (27,285) (33,831) 15,027 (30,062) (6,787) 92,697

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