Monday, July 26, 2021

    Why I relocated to northern Nigeria to start tomato jos, Mira Mehta

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    Naija247news is an investigative news platform that tracks news on Nigerian Economy, Business, Politics, Financial and Africa and Global Economy.

    When Mira Mehta made the decision to relocate to Nigeria in 2014, her father questioned her choice of residence.
    Published 1 year ago on April 26, 2019 By Fakoyejo Olalekan Mira Mehta of Tomato Jos speaks to Nairametrics, Tomato crisis in Nigeria, Tomato production in Northern Nigeria, Twitter Tweet Chat
    When Mira Mehta made the decision to relocate to Nigeria in 2014, her father questioned her choice of residence.

    “But you already lived there once! Why do you want to go and live there again?” he asked. That question didn’t have the perfect answer. Mehta just couldn’t shake off the emotional attachment she has for Nigeria, a country she has been living in since 2008.

    Mehta, who is a Finnish/Indian and American citizen, had the opportunity to begin her career in a developed country where basic amenities are readily available to be utilised. Instead, she chose to establish an agricultural company in a Sub-Saharan African emerging economy like Nigeria. Now mind you, she didn’t even establish her company in Lagos, the so called commercial hub of the country. Instead, she went all the way up north.

    Why Northern Nigeria?
    So what made Mehta prefer Northern Nigeria as the location for her business, Tomato Jos? Could it be the market size or guaranty of returns on investment? After all, Lagos is like the promise land for entrepreneurs. Regardless, reports about the environment and entrepreneurial spirit of Northern Nigerians were enough to lure Mehta and her dreams.

    That was how Tomato Jos was established in Nasarawa State before it was eventually moved to Kaduna. Nairametrics learnt all these during a TweetChat we had with the her yesterday, April 26, 2019.

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    Why Tomato Jos?
    The name of Mehta’s business shows the deep connection she has with the North. According to her, the fondness she has for Northern Nigeria was influenced by the likes of Sim Shagaya (the Founder of Konga and Executive Chairman of DealDey) and his friends who kept telling her how beautiful their town, Jos.

    The Jos crowd was very entrepreneurial and they encouraged me to develop and nurture this random pipe dream that I developed about 6 months after I moved to Nigeria: to start a tomato paste factory in Kano. Well, of course they thought it was a great idea but it should be in Jos!

    — Mira Mira on the wall (@ShoutsAndMiras) April 25, 2019

    How she raised capital to establish Tomato Jos
    While trying to set up Tomato Jos, Mehta approached friends and family with a SAFE (Simple Agreement for Future Equity) document.

    What is SAFE?: It is an agreement between an investor and a company that provides rights to the investor for future equity in the company similar to a warrant; except without determining a specific price per share at the time of the initial investment.

    Great question. I raised money with a SAFE document through friends and family. I had 2 family members (non-Nigerian), my former boss (Nigerian), a mentor and fellow HBS alumnus (Nigerian), a former colleague’s boyfriend (non-Nigerian), and someone who heard me pitch (Ghanaian).

    — Mira Mira on the wall (@ShoutsAndMiras) April 25, 2019

    Tomato Jos operates in three segments;
    Farming tomatoes (and maize and soy in the rainy season),
    Processing tomatoes, and
    Selling a branded product – So far we’re only really doing the first thing, but the company intends to start processing in 2020.
    Mehta disclosed during the TweetChat that the company is currently in need of capital in order to build a factory that will process tomatoes and improve Tomato Jos‘ financials.
    Short answer is yes – now that we’ve been able to prove that we can provide enough raw material to support a factory, all we need is the factory and we can start processing, which will dramatically improve our financials. But the factory costs $2 million… Eek!

    — Mira Mira on the wall (@ShoutsAndMiras) April 25, 2019

    Mehta said Tomato Jos operates like any other tomato paste company
    The former. We produce all our paste for the year over a 90 day period. This is how tomato paste is made all over the world… you have to max out on your capacity utilization when you’re in season because the rest of the time the factory just sits there. It’s a tough biz.

    — Mira Mira on the wall (@ShoutsAndMiras) April 25, 2019

    Challenges faced in the business
    Although Tomato Jos has yet to begin full-fledged tomato paste business, Mehta said the non-availability of raw materials makes it difficult for her paste business. Therefore, there is need to always farm.

    Well, we haven’t even ENTERED the actual tomato paste business yet. We’re still just farming. But I think one of the biggest challenges with tomato paste has to do with the fact that if you’re NOT farming, it’s really hard to get raw material when you need it, at the right price.

    — Mira Mira on the wall (@ShoutsAndMiras) April 25, 2019

    Delays at the port are one of my biggest nightmares, and they happen EVERY TIME. It’s so, so frustrating. Yes, we’re factoring that reality into our timeline…. sigh.

    — Mira Mira on the wall (@ShoutsAndMiras) April 25, 2019

    Short term plan for Tomato Jos
    Mehta said during the TweetChat with Nairametrics that the goal is to launch Tomato Jos’ tomato paste brand in the second quarter of 2020.

    Our goal is to launch our brand around this time next year (April/May). We have to get the equipment though… but we’ll keep our followers posted on the @teamtomatojos handle as we continue to make progress!

    — Mira Mira on the wall (@ShoutsAndMiras) April 25, 2019

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