Annual Report

2011

Faces of Africa’s Emerging Enterprises

2 ANNUAL REPORT 2011

I am delighted to share with you Market Matters Inc.’s 2011 Annual Report. On the cover, we profile a few of the faces of Africa’s emerging enterprises – our clients. They are a diverse group of men and women who vary in age, education, and their level of experience when it comes to running a business. But they all have one thing in common – the drive to build a successful agribusiness that is able to serve the needs of their communities and compete in an increasingly globalized marketplace.

Our goal is to help these men and women meet their goal through programs that enable them to build management skills, identify new business opportunities, and network with representatives of the private and public sectors and academia. Each year our clients tell us that our programs give them not only much needed skills but, importantly, inspiration to double their efforts to make their business a success.

It is such feedback that makes us continue to seek out new opportunities to expand our programs. In 2011 MM Inc. conducted five capacity strengthening programs in South Africa and Botswana that reached a total of 197 participants. The Seeds of Development Program, MM Inc.’s network creation initiative, continued its work with twenty-six African-owned seed companies.

Having close ties to academia, Market Matters Inc. also engaged in research activities in 2011. In this arena, the most significant achievement of the year was the publication of the volume “Case Studies of Emerging Farmers and Agribusinesses in South Africa,” co-edited by MM Inc. staff and colleagues from Stellenbosch University (South Africa). The volume was published in South Africa and has been well received by the agribusiness and policy communities.

Over the last decade Market Matters Inc. has built a strong foundation that has sustained the organization. Our supporters, Board Members, and collaborating partners have been instrumental to our success. In the coming years we will continue to build on this foundation, which, I am confident, will see the ever-growing impact of our activities in emerging markets.

Sincerely:

Ralph Christy CEO/Chairman of the Board

A Message from the CEO Each year

our clients tell us

that our programs

give them not only

much needed skills

but, importantly,

inspiration to double

their efforts to make

their business a

success.

Throughout this report, we have created links to additional information found online; please look for these links to read more about our programs.

3 ANNUAL REPORT 2011

The numbers speak for

themselves. In 2002, Mrs. Kapiza

started her business with USD133.

By the end of 2010, the value of

her business was USD100,000...

Recognizing SuccessThe African Agribusiness Entrepreneur of the Year award is an annual prize that recognizes an outstanding agribusiness from the Continent. The 2011 award went to Dinnah Kapiza, a successful agrodealer from Malawi with a remarkable personal story. Ms. Kapiza attended the 2011 Making Markets Matter program Closing Banquet, where she was presented with her award by MM Inc.’s CEO Ralph Christy and Dean Mohammad Karaan (AgriSciences, Stellenbosch University).

Dinnah Kapiza is an agrodealer based in Mponela, Malawi. In 1999, Mrs. Kapiza lost her husband, and, unable to support her ten children on her teacher’s salary, she moved back to her home village of Mponela to start a small business selling used clothing. In 2002, Mrs. Kapiza learned of the CNFA/RUMARK agrodealer training program. Through the training, she recognized the opportunity in the underserved agroinput market, and with a grant from the Malawi Agrodealer Strengthening Program (“MASP”), she opened her first shop. Her training enabled her to build commercial relationships with suppliers of seed, fertilizer, and agrochemicals. The credit that these suppliers provided allowed Mrs. Kapiza to build her business and supply much needed inputs to small holder farmers.

As her business grew, Mrs. Kapiza received a grant to rehabilitate a warehouse. This warehouse, along with her business acumen, enabled her to purchase excess maize, soy beans and ground nuts from small farmers and sell the produce to larger buyers.

She also organized women’s outgrower groups and introduced those groups to micro-financing institutions, which have helped the women generate income from their small plots.

Today, Mrs. Kapiza operates four agrodealer shops. She has ten permanent employees and she hires an additional six temporary employees during buying season. Her operations provide much needed market opportunities to over 3,000 small farmers in the region. Before Mrs. Kapiza started her business, these farmers would have to travel over 60 kilometers to access seed and fertilizer. Today her customers travel no more than 10 kilometers to get to one of her shops. Additionally, with assistance from the Alliance for a Green Revolution in Africa, Mrs. Kapiza acquired trucks, and she now offers pick-up and delivery service to farmers doing larger volume business with her.

The numbers speak for themselves. In 2002, Mrs. Kapiza started her business with 20,000 Malawi kwacha (US$133). In 2010, Mrs. Kapiza sold approximately 200 metric tons of fertilizer and over 30 metric tons of seed. As of the end of last year, the value of her business was 15,000,000 Malawi kwacha (approx. US$100,000). In addition to her business, Mrs. Kapiza also gives back to her community. She is President of the RUMARK Agrodealer Association, which has approximately 200 members. Mrs. Kapiza manages many of RUMARK’s demonstration plots, which showcase improved seed and soil fertility enhancing agents for local farmers. She also serves as a member on the RUMARK Board of Directors.

Mrs. Dinnah Kapiza, receiving her award.

4 ANNUAL REPORT 2011

Capacity-Strenghtening and Network-Building in 2011In 2011, MM Inc. conducted five business training programs in South Africa and Botswana for a total of 197 participants. In May, MM Inc. hosted the 11th Making Markets Matter (MMM) agribusiness education program, our flagship initiative. Including this year’s program, the MMM series has trained close to 600 participants from agribusiness firms, business development services, nongovernmental organizations, government departments, and development agencies. After eleven consecutive annual programs, Making Markets Matter is recognized as a premium business development services (BDS) training program for emerging entrepreneurs in Southern and East Africa.

The 2011 program hosted 68 participants from 12 African countries. Over a third of the participants were women, a significant achievement in an industry still dominated by men. The diverse group of facilitators and guest speakers represented countries from three continents (Africa, Asia, and North-America), a variety of organizational backgrounds, including universities (University of Botswana, Tshwane University of Technology, Cornell and Stellenbosch Universities), the nonprofit and development sector (the Syngenta Foundation for Sustainable Agriculture), and the private sector (the Industrial Development Corporation).

In participants’ own words...

Very informative. It allowed me as a business leader to understand and respect the cultures of other African business leaders.

I was blown away by how practical and relevant the topics were. They were pitched at the right level and covered a wide range of subjects that affect small and medium businesses.

In one week I learned what would take many years to learn and got everything at next to no cost, given the caliber of the facilitators.

It was great to have access to such inspirational people.

It was worthwhile, a time of learning and networking.

The 2011 program

hosted 68 participants

from 12 African

countries. Over a third

of the participations

were women.

Participants of the 2011 MMM program.

5 ANNUAL REPORT 2011

The Seeds of Development Program – Highlights of 2011Established in 2003, SoDP is an award winning initiative that has created a powerful network of 26 locally owned, emerging seed companies operating in eight countries in East, Southern, and West Africa (Kenya, Tanzania, Uganda, Zambia, Zimbabwe, Malawi, Mozambique, and Mali). SoDP operates through a Fellows Program; selected seed companies that serve smallholder farmers in Africa are invited to join the program. In 2011 SoDP carried out the following activities:

•Capacity building - 18 SoDP representatives attended the “Making Markets Matter” Program. The program included special sessions for seed companies with Dr. Dilip Gokhale, representing the Syngenta Foundation for Sustainable Agriculture.

•Field trips - four SoDP Fellow companies were awarded small grants to travel to Belgium, Burkina Faso, Uganda, and Zambia, where they visited other seed companies, attended trade shows, and CGIAR research centers.

•One-on-one engagement: SoDP’s program coordinator, Dr. Ed Mabaya, conducted six site visits to SoDP companies. In addition, he engaged with Fellows during the Making Markets Matter program and represented SoDP at several seed industry meetings and conferences in Africa.

Each year SoDP Fellows are asked to provide basic company data for the M&E report. Below is the most recent average seed sales figures.

... a powerful network

of 26 locally owned,

emerging seed

companies operating

in eight countries in

East, Southern, and

West Africa.

SoDP representatives at the

MMM training program.

6 ANNUAL REPORT 2011

New publication: Case Studies of Emerging Agribusinesses and Farmers in South AfricaBuilding on MM Inc.’s years of experience working with agribusinesses in South Africa, MM Inc. led the research and publication of a volume of fifteen case studies profiling emerging agribusinesses in South Africa. Co-edited by MM Inc.’s COO Krisztina Tihanyi, Dr. Ed Mabaya (Cornell University), and Drs. Mohammad Karaan and Johan van Rooyen (Stellenbosch University, South Africa), the volume was published by SunMedia at Stellenbosch University. The goal of the project was to capture the human faces and stories behind emerging farms and agribusinesses in South Africa and showcase their rich diversity, historical backgrounds, current context, and future directions. The volume also highlights the best practices, opportunities, and challenges facing South Africa’s emerging farmers and agribusinesses and provides a new set of instructional and reference materials for academics, development practitioners, and policy makers. The book has been received with interest in South Africa; it was launched during the annual conference of the Agricultural Economics Association of South Africa in September 2011.

Saying thank-you to our founding Board MembersIn the December Board Meeting, the MM Inc. Board of Directors expressed its appreciation to the three Founding Board Members, Ms. Natasha Blackshear, Dr. Kenneth Robinson, and Dr. Mark Wenner, whose tenure came to an end in 2011. Natasha, Ken, and Mark each provided invaluable advice, assistance, and guidance throughout their six years of service to Market Matters Inc. The organization is fortunate to have benefited from their expertise and commitment.

Ms. Natasha Blackshear

Dr. Ken Robinson

Dr. Mark Wenner

Thank you!

7 ANNUAL REPORT 2011

Financial Highlights

2011 2010Changes in Unrestricted Net Assets:

Revenues:

Restricted:

Net assets released from restrictions $ 127,483 $ 105,294 Total Restricted Revenues 127,483 105,294

Unrestricted: Contributions 43,423 38,650 Indirects from grants 9,617 4,832 In-kind contributions 43,705 43,705 Interest and dividend income 19,576 20,796 Unrealized loss on investments (47,732) (6,410) Realized loss on investments (352) -0- Monitoring and evaluation 2,000 500 Other income 25,570 35,721 Consulting income 17,286 17,116 Workshop income 90,287 151,390 Total Unrestricted Revenues 203,380 306,300

Total Revenues 330,863 411,594

Expenses: Program Restricted:

Communication 2,119 -0- Monitoring and evaluation 2,000 500 Other SODP activities/Fellows training 42,042 48,502 Personnel - Salaries and benefits 21,162 7,522 Research 3,679 -0- Supplies -0- 504 Travel 9,619 4,229 Workshops 37,245 39,205 Indirect costs 9,617 4,832 Total Program Restricted Expenses 127,483 105,294

Program Unrestricted:

Workshops 43,751 38,564 Total Program Unrestricted Expenses 43,751 38,564

8 ANNUAL REPORT 2011

Financial Highlights

Support Services:

Communication $ 7,099 $ 8,286 Entertainment 3,266 4,615 Equipment 255 -0- In-kind salary plus fringes (CEO) 31,705 31,705 In-kind rent 12,000 12,000 Insurance 546 511 Miscellaneous 4,726 7,140 Consulting 28,868 5,182 Payroll expenses 59,159 102,496 Printing and publishing 2,541 169 Professional fees 15,098 10,997 Rent 18,000 24,000 Travel 2,696 201 Total Support Services Expenses 185,959 207,302

Total Program Unrestricted and Support Services Expenses

229,710 245,866

Total Expenses 357,193 351,160

Change in Unrestricted Net Assets (26,330) 60,434

Changes in Temporarily Restricted Net Assets:

Revenues: Grants 185,029 66,724 Net assets released from donor restriction (127,483) (105,294)

Change in Temporarily Restricted Net Assets 57,546 (38,570)

Changes in Permanently Restricted Net Assets:

Contributions -0- -0-

Change in Net Assets 31,216 21,864

Net Assets, Beginning of Year 1,183,436 1,161,572

Net Assets, End of Year $ 1,214,652 $ 1,183,436

2011 2010Changes in Unrestricted Net Assets:

9 ANNUAL REPORT 2011

In 2011, MM Inc. raised US$ 40,842 in contributions. We are proud to have the continued support of individuals and organizations who share our vision of creating opportunities for growth and success for small and medium-size businesses in emerging markets.

Fundraising Highlights

BOARD OF DIRECTORS

Ralph D. Christy, Chair

Professor, Cornell University, Ithaca, NY

Natasha Blackshear

Attorney, Gonzalez, Saggio & Harlan LLP

Robert Herdt

Professor, Cornell University Ithaca, NY

Francisco Pedraza

International Management Consultant, Chicago, IL

Kenneth Robinson

Professor, Clemson University Clemson, SC

Mark Wenner

Economist, Inter-American Development Bank

Washington, DC

CONTRIBUTORS (2003-2011)

Anonymous (12) / Ad Hoc Foundation / Alpha Phi Alpha Alumni Chapter / Association of Extension Adminig / Cornell University / Fall Creek Management / Glory Foods / San Francisco Foundation / Seevers Family Foundation / Adelaja, Soji / Akridge, Jay and Michelle / Allen, Ivye L / Baharanyi, Ntam & Bernice / Barrett, Christopher B. and Clara S./ Benson, D.L. / Bezuneh, Mesfin /Blackshear, Natasha / Bonnen, James T. / Brown, Michael / Christy, Anthony / Christy, Caleb / Christy, Clinda / Christy, Larry H. and Joyce T. / Christy, Paul A. / Christy, Ralph / Christy, Reginald / Christy, Ruth and Shelly

/ Dassie, Wylin / Davis, Carlton / deGorter, Harry / Forker, Olan D. and Katie / Gakonyo, Njeri / Gorman, Julia / Guedry, L.J. and Ann V. / Harris, Robert / Herdt, Robert and Lorna / Hinson, Roger / Holdcroft, Lane / Jacqumotte, Pierre / Jancic, Alexandra / Johnson, Willene / Jones, Eugene / Kennedy, Ronald / Kerns, Samuel & Ian Anderson / Kiiti, Ndunge C. / Kraft, Leon / Lerner, Scott and Caroline / Mabaya, E. and K. Tihanyi / McDowell, Donald D. / McLeod, Poppy / Mukunya, Alfred / Mutambatsere, Emelly / O’Planick, Kristin / Pedraza, Francisco and Sarah / Renusson, Gilles / Roberson, Quinetta / Robinson, Ken / Stafford, Thomas / Stalnaker, David & Eva / Struk, Tamara / Thomas, Chantal / Tomek, William / Weissernstein, Josh / Wenner, Mark / West, Sherece Y. / Wilson, Norbert and Wylin / Williams, Ellis E./ Zhang, Jipei

Making Markets Matter - Class of 2011

MARKET MATTERS INC.

401 S. Albany Street Ithaca, NY 14850

T: +1 607 277-3178 F: +1 646 720-0085

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