21/04/2026
Think on these things!✅
Innovation series (Part 1)
__New thinking about centuries-old challenges
One of my business partners came to see me one day with an extraordinary entrepreneurial idea that absolutely captured my imagination. It was one of the most innovative business ideas I'd ever come across.
First of all, he laid out the entrepreneurial context, outlining the problem he was trying to address:
“For centuries, cattle have been at the centre of how Africans in rural areas think about wealth. We are all aware that for rural communities, cattle are a 'store of wealth’, but, from a modern economy point of view, they cannot actually monetize that wealth, like, say, investing in gold or having a property in the city. There's also the ever-increasing challenge of not enough grazing land, which has turned into deadly conflict in some countries.”
I was aware of all this and was waiting to hear his solution. He had experience in both banking and cattle businesses.
“I think I have an entrepreneurial solution. I call it CattleBank,” he exclaimed. "What if cattle herders were able to 'bank' their cattle?”
“Bank?” I asked cautiously, but he had my attention.
His pitch continued:
"Yes! The CattleBank works like this: My company sets up a sophisticated professional feedlot where I can hold say, 5,000 cattle. The farmers bring in their cattle, which must be no more than two years old. We weigh them, age them, and value them. Then we give the farmer a "deposit certificate" setting the value, and a coupon with a two-year maturity," he explained.
"We pay interest on the certificate and take over the security, feeding, and professional care of the cattle. In two years or the agreed coupon maturity date, they will come and collect an animal from us, of the same specification as what they deposited, and they will have earned interest income on it for two years.”
I thought about it for a short while, then asked: “What is the innovation?”
“If you went to the bank and deposited $1,000 cash with a fixed coupon of 10% per annum, and a two-year maturity, you get $100 per year in interest income, and then get back $1,000 in year two, right?”
I smiled. “Are the certificates tradable?”
“They are a title deed. You can borrow against them. We recognise them, and we will lend the farmer cash.”
“So, what do you think?” he concluded.
“My friend, you are a genius!” I beamed.
Now here's the takeaway I want you to think about as I begin this series:
This is an example of extreme innovation being applied to an old industry. What this entrepreneur did was to how we raise cattle in the rural areas. Simply because something has always been done a certain way, does not mean it cannot be changed.
He built a modern feedlot where rural cattle are brought and fattened under the supervision of veterinary experts. There is total security for the cattle, so stock theft is not possible.
At the heart of this innovation is a “bank”. Do you understand what is happening and how they make money?
It is absolutely brilliant and it is the sort of where investors come to you and not the other way round. This guy did not need my or anyone else’s money for that matter!
If you have not yet figured out how he planned to make his money, I'd suggest do some research and also a refresher course by revisiting my posts over the years. (Never do a pitch without explaining your revenue model, by the way!)
The key message I want to remind you is that INNOVATION is not just about technology-type businesses. INNOVATION is the key driver in the most successful entrepreneurial businesses, period.
Image caption: Africa's agrifood system is filled with opportunity for innovation! What do YOU see?
