On starting over: Troy Holmberg of Coast Coconut Farms
When a good idea is executed poorly the smart social entrepreneur will often scrap the project and go back to the drawing board. In this series entrepreneurs talk about discarding what isn’t working and starting over in order to maximize social impact.
Troy Holmberg is a co-founder of Coast Coconut Farms a social enterprise that brings sustainable employment and microfranchises to rural Kenya.
Dowser: What’s something concrete you’ve learned in the last three months?
Holmberg: We started with a technology to make coconut oil that was very appropriate for a small-scale, rural scenario—which was the situation we found ourselves in when we started our project five years ago. Back then, we didn’t have a good idea of who our customers would be and what they would require. As we matured and started to find customers, we were forced to look at more efficient and economical ways to produce our oil. Just recently we took some trips to other parts of the world to see how they are making coconut oil for the world markets. We discovered that the initial technology we were using was not the technology we really needed to service our customers.
We have since, at considerable cost and time, purchased and installed all new equipment with a process that meets the needs of our customers. We learned that what we should have done in the very beginning was to search out the best technology from around the world and really understand the business and technology before jumping into the business.
We have also learned that it is critical to have a Western manager on the ground full-time to work with and mentor the Kenyan managers and team. It has made a huge difference and there is a synergy as we combine Western management styles and knowledge with the local knowledge of markets and culture that has made us more successful. But it can’t be done alone with only Western or only Kenyan perspectives and knowledge.
What is a mistake or mishap you’ve learned from?
Coast Coconut Farms spent the first three years of its existence struggling to find customers and markets for its product (virgin coconut oil). We got into the business with only a very limited understanding of the market and needs of the customers. We took on the mentality, ‘if you build it, they will come.’ We started making oil and warehousing it without having any real customers in hand. Those first three years cost us a lot of money, time and mental capital trying to understand how to make our business model successful.
We are now over that hump, thank goodness, but we are still struggling to manage a business in a third world that is servicing customers in the developed world. Quality, reliability, transportation and costs are all critical issues to our customers that are very difficult for us to control in an environment like Kenya. It can be thrilling and very rewarding as we help create jobs and improve lives, but it is extremely challenging, frustrating and unpredictable. You have to be prepared to work in such an environment. Looking back, we would have taken more time and effort in doing research and due diligence on the market, industry and technologies before jumping in and committing significant resources.
Interview has been edited and condensed.
Photo courtesy of Troy Holmberg