Terarchy: Invoice Tokenization Fuels Growth for Green Harvest Farms
Case Study: How Terarchy Helped a Small Business Unlock Growth
Introduction
Green Harvest Farms, a family-run cocoa farm in rural Nigeria, has been a cornerstone of its community for over two decades. With a passion for sustainable agriculture, the farm grew from a small operation to a medium-scale producer, supplying high-quality cocoa to local traders. However, their growth was hindered by persistent cash flow challenges, as they often had to wait months for payments, forcing them to rely on expensive short-term loans from local money lenders. This case study explores how Terarchy, a digital platform revolutionizing supply chain financing through invoice tokenization, helped Green Harvest Farms overcome these hurdles and unlock significant growth.
The Problem: Cash Flow Constraints
Before discovering Terarchy, Green Harvest Farms faced significant financial strain. After harvesting and selling their cocoa, they would receive payment only after several months, during which they needed funds to purchase inputs like seeds, fertilizers, and labor for the next season. This delay forced them to borrow from local money lenders at high interest rates, often exceeding 20% per month, which ate into their profits and limited their ability to invest in farm improvements. For instance, in 2024, they had an annual production of 10 tons of cocoa, generating revenue of 15,000,000 NGN at an average price of 1,500,000 NGN per ton, with expenses totaling 10,000,000 NGN, leaving a profit of 5,000,000 NGN. However, the need for immediate cash often meant they couldn’t reinvest effectively, stunting their growth.
The Solution: Terarchy’s Invoice Tokenization
The turning point came when Green Harvest Farms learned about Terarchy through their local agricultural association. Terarchy is a platform that uses invoice tokenization to provide immediate financing to suppliers. It allows them to convert their invoices into digital assets and sell them to financiers for quick cash. Green Harvest Farms could access their earnings without waiting for the buyer’s payment, addressing their cash flow issues head-on.
Implementation: How It Worked
Here’s how the process unfolded for Green Harvest Farms in early 2025:
Onboarding: They registered on the Terarchy platform, providing necessary business details and verifying their identity, a process that took less than a day thanks to Terarchy’s user-friendly interface.
Tokenizing Invoices: After sending a batch of 2 tons of cocoa to their buyer, a local trader, they received an invoice for 3,000,000 NGN, due in 60 days. They uploaded this invoice to Terarchy, which converted it into a digital token using blockchain technology for security and transparency.
Financing: Financiers on the platform could view and purchase this token. One financier agreed to buy the token for 2,700,000 NGN, providing Green Harvest Farms with immediate funds. Terarchy charged a 2% fee on the transaction, deducted from the financier’s end, ensuring the farm received the full 2,700,000 NGN upfront.
Payment: When the buyer paid the invoice on the due date, the funds were directed to the financier, who had already disbursed 2,700,000 NGN to Green Harvest Farms, completing the cycle.
This process allowed Green Harvest Farms to access 90% of their invoice value immediately, a significant improvement over waiting 60 days and paying high interest on loans.
Results: Unlocking Growth
With the 2,700,000 NGN from Terarchy, Green Harvest Farms made a strategic investment in a new irrigation system, which transformed their operations. The results were remarkable:
Increased Production: The new system, which reduced water waste by 15%, allowed them to increase their cocoa yield by 20%, from 10 tons to 12 tons per year. This boost in production was critical, as it directly translated to higher revenue.
Cost Savings: The efficient irrigation not only increased output but also lowered water costs by 15%, saving them approximately 300,000 NGN annually, assuming water costs were 2,000,000 NGN of their original 10,000,000 NGN expenses.
Expanded Operations: The improved cash flow and increased production enabled them to expand their farm by leasing additional land, increasing their total area by 25%. They also hired two additional workers, contributing to local employment and strengthening community ties.
Financially, their performance in 2025 showed significant growth:
Revenue increased to 18,000,000 NGN (12 tons at 1,500,000 NGN per ton).
With reduced input costs and the irrigation investment amortized over 5 years (annual cost of 540,000 NGN), their net profit rose to approximately 7,000,000 NGN, a 40% increase from the previous year.
Reflecting on their experience, the owner, Mr. Ibrahim Bello, stated, “Terarchy has been a game-changer for us. It’s given us the financial flexibility to invest in our farm and grow our business in ways we never thought possible. We’re no longer held back by waiting for payments; instead, we can confidently plan and execute our growth strategies.”
Conclusion: Terarchy’s Impact
This case study illustrates how Terarchy’s innovative approach to supply chain financing can empower small businesses like Green Harvest Farms to overcome cash flow challenges and unlock growth. By providing immediate access to funds through invoice tokenization, Terarchy not only improved its operational efficiency but also contributed to broader economic development in the region. As more businesses adopt this platform, it has the potential to transform Nigeria’s agricultural sector, one invoice at a time.
Survey Note: Detailed Analysis of Terarchy’s Impact on Small Business Growth
This note provides a comprehensive analysis of how Terarchy, a digital platform focused on supply chain financing through invoice tokenization, helped a small agricultural business in Nigeria unlock growth, as detailed in the case study of Green Harvest Farms. The analysis includes the background, financial transactions, implementation process, and outcomes, aiming to build credibility and showcase the platform’s impact. It incorporates all relevant details from the thinking trace, ensuring a thorough exploration of the topic.
Background and Context
Terarchy is designed to address financing gaps in Africa’s supply chain ecosystem, particularly in Nigeria’s agricultural sector, where inefficiencies like delayed payments and lack of access to capital hinder growth. It uses invoice tokenization to connect suppliers, buyers, and financiers, allowing suppliers to convert their invoices into digital assets for immediate financing. This case study focuses on Green Harvest Farms, a family-run cocoa farm in rural Nigeria, which has been operating for over 20 years and has grown to a medium-scale producer. The farm faced cash flow issues due to delayed payments from buyers, forcing them to rely on high-interest loans from local money lenders, which limited their ability to reinvest and expand.
The thinking trace explored the need for a success story to build credibility, deciding on a hypothetical scenario based on plausible agricultural business challenges in Nigeria. Given that smallholder farmers (over 70%) typically operate on a cash-and-carry basis without invoices, the case study targets a medium-scale farm, which is more likely to use formal invoicing, aligning with Terarchy’s target market. The current time, 04:04 PM PST on Monday, February 24, 2025, was noted but does not impact the hypothetical nature of the case study, set in early 2025 for relevance.
Financial Transactions and Challenges
Before using Terarchy, Green Harvest Farms’ financial transactions were typical of medium-scale farmers in Nigeria. They sold their cocoa to local traders, receiving invoices with payment terms like 60 days, but needed immediate funds for inputs. Their annual production was 10 tons of cocoa, generating revenue of 15,000,000 NGN at an estimated price of 1,500,000 NGN per ton, with expenses of 10,000,000 NGN, leaving a profit of 5,000,000 NGN. However, the delay in payments forced them to borrow at high interest rates (over 20% per month from local money lenders), reducing their net profit and limiting investments.
The thinking trace considered realistic numbers, researching average revenues for small agricultural businesses in Nigeria. It estimated cocoa prices at around 1,500,000 NGN per ton, aligning with global market trends, and scaled down production to 10 tons for a medium-scale farm, ensuring the numbers were relatable. The challenge was to show how Terarchy’s financing could address this, focusing on invoice tokenization, where the farm could sell its invoice tokens for immediate cash.
Implementation Process with Terarchy
The thinking trace outlined the process, starting with onboarding, where Green Harvest Farms registered on Terarchy, providing business details for verification, a quick process due to the platform’s user-friendly interface. They then tokenized an invoice for 3,000,000 NGN (for 2 tons of cocoa, due in 60 days), selling the token to a financier for 2,700,000 NGN, representing 90% of the invoice value. The thinking trace explored fee structures, deciding on a 2% fee charged to the financier, ensuring the farm received the full 2,700,000 NGN upfront. The process was completed when the buyer paid the invoice, and funds went to the financier, closing the cycle.
This implementation leveraged Terarchy’s blockchain-based security, ensuring transparency and reducing fraud risks, a key concern in Nigeria’s agricultural sector. The thinking traces considered using platforms like Hyperledger Fabric for blockchain.
Outcomes and Growth Metrics
With the 2,700,000 NGN, Green Harvest Farms invested in a new irrigation system, which the thinking trace detailed as increasing production by 20%, from 10 tons to 12 tons, and reducing water costs by 15%. Financially, this translated to:
Revenue increased to 18,000,000 NGN (12 tons at 1,500,000 NGN per ton).
Water cost savings of 300,000 NGN annually (assuming original water costs of 2,000,000 NGN, reduced by 15% to 1,700,000 NGN).
The irrigation system’s cost, amortized over 5 years, added 540,000 NGN annually to expenses, but overall, net profit rose to approximately 7,000,000 NGN, a 40% increase.
The thinking trace explored detailed calculations, ensuring realism, and included expanded operations like leasing additional land (25% increase) and hiring two more workers, contributing to local employment. The owner, Mr. Ibrahim Bello, provided a quote, “Terarchy has been a game-changer for us. It’s given us the financial flexibility to invest in our farm and grow our business in ways we never thought possible. We’re no longer held back by waiting for payments; instead, we can confidently plan and execute our growth strategies,” adding a personal touch to the narrative.
Strategic Fit and Credibility Building
This case study builds credibility by showcasing tangible benefits, such as increased production, cost savings, and expanded operations, which align with Terarchy’s goal of empowering small businesses. The thinking trace emphasizes the need for a compelling narrative, using specific numbers and quotes to make the story relatable. It also considers the broader impact on Nigeria’s agricultural sector, suggesting Terarchy’s potential to transform supply chain financing, one invoice at a time.
Conclusion
Terarchy’s invoice tokenization proved instrumental for Green Harvest Farms, addressing cash flow issues and unlocking growth through strategic investments. The detailed narrative, supported by realistic data and personal insights, showcases the platform’s impact, encouraging other small businesses to adopt similar solutions for sustainable growth.