Kenya’s Twiga Foods raises $10 million capital from IFC, TLcom

PUBLISHED BY
Anna Domanska



TAGS:


3 years ago




Twiga Foods, a Kenyan-based startup that connects smallholder farmers to retail vendors, has secured $10 million capital from investors led by the International Finance Corporation (IFC) – a member of the World Bank Group, Venture Capital TLcom and the Global Agriculture and Food Security Program (GAFSP).

Participants in the round include Twiga’s previous investors DOB Equity, 1776, Adolph H Lundin and Warmda Capital. The startup said it plans to use the new investment to expand its “operations and offer new services” such as including fast moving consumer goods (FMCG) and processed food to its product lineup.

Twiga Foods is a business-to-business distribution platform that uses mobile phone technology to match buyers for farm produce with the suppliers in a number of fruit and vegetable markets in Africa. Vendors order fresh produce from Twiga’s m-commerce directly from farmers across Kenya. The system takes care of pricing, quality control, payment, and logistics across both parties – vendors and farmers – in a subtle win-win scenario. Twiga delivers the produce at the doorsteps of the vendors for free, while the farmers enjoy a guaranteed access to a transparent and fairly priced mobile marketplace where they easily sell of their produce. Matching the demand and supply substantially allows Twiga to reduce waste and crucially reduce food prices for end consumers.

Twiga Foods

Twiga Foods is a business-to-business distribution platform that uses mobile phone technology to match buyers for farm produce with the suppliers in a number of fruit and vegetable markets in Africa.

The $10 million investment is issued in the form of convertible notes and will later be available as equity, said IFC regional head Wale Ayeni who will join the startup’s board with TLcom Founder and Managing Partner Maurizio Caio, as part of the deal.

Ayeni identified that IFC is happy with Twiga’s accomplishments and creativity so far; its use of a digital platform to serve a mass market in a sector that has “not really been touched.” He also admired Twiga’s position to create more revenue by expanding to other consumer products in the B2B supply chain.

Since it became operational in 2014, Twiga has grown its network to around 13,000 farmers and 6,000 vendors in Kenya. It kicked off with matching banana farmers to vendors, but now includes other produce like tomatoes, potato, mango, onion, and cabbage. Parties coordinate good exchange on the mobile app and making payments via M-Pesa mobile money. The company generates revenues from profits on each product it buys and sells. It could buy mangoes at 13 Shillings ($.13) a kilo and sell at 23 Shillings ($.23) a kilo.

Agtech has become a top sector for startups in Africa. Nigeria’s Farmcrowdy and Ghana’s Agrocenta are some of the companies that have raised capital from various investors for mobile-based apps that coordinate logistics, payments, and capital across food markets and farmers in the continent.

Earlier this year, Twiga Foods went into a deal with IBM Africa to introduce blockchain to its client network. Last year, the startup raised $10.3 million investment in a round led by Wamda Capital.

The new investment and proposed product expansion will allow Twiga Foods to explore offering additional services, co-founder and CEO Grant Brooke said. “We will continue in our mission to provide affordable, quality, and safe food to Kenya’s urban consumers, and reliable markets for farmers across the country.” However, Brooke added that the company is researching and dabbling in Tanzania.

Anna Domanska
Anna Domanska is an Industry Leaders Magazine author possessing wide-range of knowledge for Business News. She is an avid reader and writer of Business and CEO Magazines and a rigorous follower of Business Leaders.

Recent Posts

Renewable Energy Adoption will Need to Change Gears to Meet Net-Zero

Renewable Energy Adoption will Need to Change Gears to Meet Net-Zero

Renewable energy adoption pace is good, but it is still falling short of meeting net zero emission rate, says the latest International Energy Agency’s (IEA) annual report. Higher
1 hour ago
America is Losing its Appetite for Plant-Based Meat

America is Losing its Appetite for Plant-Based Meat

Most meat in 2040 will not come from animals, says report. However, the recent decline in sales of plant-based meat fell by 1.8 percent compared to the year before, taking declines
1 day ago
Fusion startup raises $1.8 billion to give us unlimited clean energy

Fusion startup raises $1.8 billion to give us unlimited clean energy

Commonwealth Fusion Systems secures more than $1.8 billion in Series B funding to commercialize fusion energy. The funding round was led by Tiger Global Management with participati
2 days ago
Omicron might push inflation, says OECD

Omicron might push inflation, says OECD

The latest Coronavirus variant, Omicron, which is believed to be more transmissible and severe, might derail growth and recovery and raise costs, according to the Organization for
2 days ago
Who is Parag Agrawal, Twitter’s new CEO?

Who is Parag Agrawal, Twitter’s new CEO?

Indian-born Parag Agrawal took over as the CEO of Twitter as co-founder Jack Dorsey stepped down for the second time in his career. Agrawal is the fourth person to take the reins a
3 days ago
Goldman Sachs rolls out paid leave for pregnancy loss

Goldman Sachs rolls out paid leave for pregnancy loss

Goldman employees are now eligible for 20 days of paid leave for a miscarriage or stillbirth. The investment banking giant is also increasing its retirement fund matching contribut
3 days ago