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Youn and cofounder John Gachunga’s epiphany gave birth to the One Acre Fund (OAF), which provides microfinance, supplies, and insurance to rural African farmers. While OAF is a nonprofit organization driven by compassion, it does not treat farmers as charity cases and does not function as a charitable organization that simply hands out cash and resources without any obligation to repay. In fact, OAF was designed to function on a sustainable business model that lends money and resources to farmers and expects repayment based on a schedule determined by seasonal harvests and market conditions rather than by the more rigid schedules of traditional microfinance.

One of the problems Youn recognized during his internship in rural Africa was the way traditional microfinance had been designed around the needs of people who sold products and services in urban markets. This supported an unsustainable growth of urban micro-entrepreneurs to the neglect of farming and rural development. Because the income of farmers is not constant, but rises and falls according to the seasonal harvest, they had a difficult time attracting microfinance dollars because most of these monies were offered only under regimented repayment conditions that the farmers could not meet. Because of this lack of credit, supplies, and training, rural farming communities were languishing, and farmers were consigned to live in persistent conditions of poverty.

In response to these circumstances, the One Acre Fund sought to work with rural farmers in Burundi, Rwanda, and Kenya to provide a package of agricultural goods and services that would change the market equation that had left the farmers no better off than when they began. The fund set up its training, credit, supplies, and insurance programs so that the farmers would pay for these on a schedule tied to the harvest cycle. The farmers repay their loans at harvest time, and those repayments are recycled back into the fund so that other farmers can then use those monies to support and expand their operations. D. Stephanie Hanson, the director of policy and research at OAF, claims, “Because we’re charging for the good or service it means we can [ensure financial] sustainability as an organization.”

The flexible loan terms set OAF programs apart from other nonprofit microfinance organizations. In many ways, OAF gives farmers the capacity to set their own repayment schedule with the caveat that the loan must be paid in full after the harvest. In addition, the program makes provisions for drought, crop failure, or other natural disasters that would prevent repayment and offers farmers the opportunity to purchase insurance to protect them from these adverse circumstances. Loans can also be forgiven in extreme situations in which farmers face unforeseen calamities.

Over its first half-decade of existence, the OAF received numerous grants and awards for its innovative approach to development financing from such prestigious foundations as the Echoing Green Fellowship, the Draper Richards Foundation, the Pershing Square Foundation, and the Skoll Foundation. In many cases, the awards were made not only on the basis of OAF’s unique and innovative approach to rural farming microfinance but also in response to the values espoused and put into practice. The One Acre Fund lists six key values that inform its operations:

1. Humble Service—We meet farmers in their fields and we get our shoes muddy. Farmers are our customers and we serve them with humility.

2. Hard Work—We work hard everyday. We execute with world-class professionalism and business excellence. Farmers deserve nothing less.

3. Continual Growth—We improve every season. We work with determination to meet our goals and then stretch ourselves by raising the bar even higher.

4. Family and Leaders—We bring together the best leaders and build long-term careers. We care for team members like family.

5. Dreaming Big—We envision serving millions of farm families. We build for scale with every idea and solution.

6. Integrity—We do what we say, and our words match our values.

After six years of operation, the results speak for themselves. OAF has experienced rapid growth in the number of families served, from 5,000 in 2006 to 125,000 in 2012. Like many other microfinance organizations, OAF enjoys a very high repayment rate on its loans and services—99 percent. On average, farmers who use the fund triple their yields in the seasons following their enrollment in the program.