TECHDIGEST – Agritech startups working to ensure access to capital, maintenance and all needed to ensure agricultural processes thrive include, but not limited to, Releaf, Farmcrowdy, Vendease, Zowasel, Voriancorelli, Skudu, Khula, Agrocenta, Apollo Agriculture and Complete Farmer

From finance to maintenance and other agricultural processes needed to make the process seamless for both farmers, wholesalers, consumers and other stakeholders, Agritech, the combination of agriculture and technology, has become inevitably important.

Most farmers encounter challenges in scaling and growing to achieve their targets due to limitations in several aspects such as financing, accessibility, among others, and beautifully, Agritech startups are on a fast rise to tackle these challenges.

Some of these companies include Releaf, Farmcrowdy, Vendease, Zowasel, Voriancorelli, Skudu, Khula, Agrocenta, Apollo Agriculture and Complete Farmer.

1. Releaf

Releaf’s hardware and software solutions enable farmers and food factories become more efficient. Last year, the Nigeria-based agritech startup raised $2,700,000 in a seed round led by Samurai Incubate Africa, Future Africa and Consonance Investment Managers.

One of its hardware products is Kraken, used to crack nuts and crush kernels into vegetable oil which are sold to FMCG processors and local manufacturers. The company also supplied high-quality raw materials and crops with sustainability at the core of its focus.

2. Farmcrowdy

Another Nigerian agritech startup, Farmcrowdy was founded in November 2016 and has grown to become the country’s leading Agritech company that connects smallholder farmers to DFIs provided by government agencies, access to market, and processed food.

In November 2020 when it clocked four, Farmcrowdy re-invented itself by launching;

Farmcrowdy Structured Finance,
Farmcrowdy Insurance,
Farmcrowdy Marketing,
Farmcrowdy Tech and Data,
Farmcrowdy Foods and
Farmcrowdy Aggregation.
These businesses were set up to serve all individuals across the entire agriculture value chain prioritizing stakeholder access to better yields, lower costs, and smarter marketing.

Farmcrowdy is backed by Techstars, GSMA Ecosystem Accelerator, FC Agro Allied SPV, Cox Enterprises, Social Capital, and several other investors.

3. Vendease

Also based in Nigeria, Vendease raised $3,200,000 in seed funding to expand operations and scale across the continent last year. The company digitises Africa’s food supply chain, with restaurants as its primary target audience and has a transaction volume of over $13,000,000.

Backed by YCombinator, Global Founders Capital, Hack VC, Soma Capital, and others, Vendease is patronised by businesses such as Dodo Pizza, Genesis restaurant, Eden, Fishermans Daughter, to mention a few. The company allows users to manage inventories, track expenses, and access its buy-now-pay-later system, making business more seamless.

4. Zowasel

Online sustainable marketplace for crops, Zowasel has created a peer-to-peer marketplace for farmers and buyers of agricultural produce to carry out transactions.

Based in Nigeria, the company’s platform provides quality crop testing and all-day working capital for growers and effortless crop sourcing for buyers, thereby connecting with the network of top vetted buyers to earn more for the crops.

With a total funding amount of $100,000, Zowasel is backed by Guinness Nigeria, Promasidor, MassChallenge Switzerland, SAIS, among others.

5. Voriancorelli

Voriancorelli bridges the gap between agribusinesses and the capital required for them to scale. The company offers agricultural commodities aggregation solutions to key players in the sector, such as buyers, sellers, commodity aggregators, logistics partners, financiers and food processors, by connecting them together digitally, thereby facilitating seamless transactions and ensuring the economic wellbeing of all stakeholders.

Voriancorelli is the first company that was screened for listing on the Lagos Commodities and Futures Exchange (LCFE).

6. Skudu

South Africa’s Skudu leverages technology to enhance efficiency within the agricultural value chain, ultimately benefiting all stakeholders involved via its method of merging deep farming know-how with cloud computing.

Last year, the agritech startup raised an undisclosed funding amount from one of Africa’s leading agri-food investors, AgVentures, to scale its online marketplace for agricultural inputs and produce, as well as its approaches in interpreting soil sample results, keeping track of farms and providing management tools, all targeted at enabling farmers to significantly lower input costs and protect the environment by optimising fertilizer application globally.

7. Khula

Another South African-based agritech startup, Khula connects subsistence and commercial farmers to agricultural supply and marketplaces. Last year, the company raised $1,300,000 from AECI, an SA agrochemical company and E Squared Investments.

Khula has a range of products such as the KHULA! Inputs app, Fresh Produce Marketplace and Funder Dashboard, which enables a hiccup-free process between local and international farmers, suppliers, wholesalers, retailers and other stakeholders.

8. Agrocenta

Ghana’s Agrocenta is solving the limited accessibility to markets for smallholder farmers in the rural areas, which brings about exploitation, purchase from middlemen and lack of a coordinated truck delivery system to cart commodities directly from farms to markets to sell.

Its $2,200,000 total funding amount was raised from investors such as Foreign & Commonwealth Office – UK, AV Ventures, Rabo Foundation, Shell Foundation, GSMA Ecosystem Accelerator and Seedstars.

9. Apollo Agriculture

Based in Kenya, Apollo Agriculture helps small-scale farmers maximise profit. Via due diligence, the company builds credit profiles for these farmers leveraging a machine learning model so as to build automated digital processes that make their lives better.

Servicing over 40,000 farmers in Kenya, Apollo Agriculture has a total funding amount of $12,200,000 raised from Agri-Business Capital Fund (ABC Fund), Anthemis Group, Leaps by Bayer, Flourish Ventures, Accion Venture Lab, Mastercard Foundation Fund for Rural Prosperity, Rabobank, FMO and Musha Ventures.

10. Complete Farmer

Ghana’s Complete Farmer is focused on food security, promoting nutritious eating, monitoring farming processes, and providing education and training to grow food precisely in order to meet industry specifications and quality.

The end-to-end digital farming platform, which enables clients to gain competitive advantage across various agriculture value chains, raised an undisclosed funding amount from Ingressive Capital.

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TECHDIGEST – A Nigerian agritech startup, Agrikoin, recently declared its commitment to end financial challenges confronting small scales farmers throughout agricultural value chain.

Agrikoin, an agriculture-backed Cryptocurrency created to catalyze financial inclusion within the agricultural value chain, is creating a decentralized supply chain that could allow farmers to sell their produce seamlessly to end consumers.

Chief Executive Officer of Agrikoin, Isa Ismail Waziri, told TechDigest at GITEX 2021 that the goal of the startup is to alleviate the financial problems of small-scale farmers through the introduction of a unique digital currency for the entire agricultural ecosystem.

Meanwhile, not many are aware of the potentials of agritech on the economy.

Agritech simply means the use of technological innovations in agriculture to increase its yield, efficiency, and profitability.

These include using technology to achieve faster planting, modified crops that grow well in different environments, and harvesting. It can also be the use of robots, big data, artificial intelligence, and other technologies necessary to solve the challenges confronting the agricultural industry.

Nigeria has seen a rapid growth of agritech startups offering digital solutions aimed at addressing the challenges faced by small-scale farmers and improving their livelihoods.

Nigerian agritech companies such as Farmsponsor, Requid, Farmcrowdy, Thrive Agric, AgroMall, Hello Tractor, and Crop2Cash have been able to harness funding opportunities to achieve social and economic impact across the agriculture ecosystem.

While some agritech start-ups have transitioned into established companies, there are several barriers that many others have to scale through to break even.

Some of these include a hostile business environment, an ecosystem unable to support long-term growth, low levels of agricultural knowledge and skills, and limited access to awareness of funding opportunities.

Active funders in the Nigerian agritech space include incubators, accelerators, angel investors, and donors, all of which tend to invest during early funding stages.

Despite this, Nigerian agritech startups have to contend with three major funding gaps: limited availability of local capital, a lack of institutional investors investing in agritech and an inability to attract big-ticket investments.

Acknowledging this fact, Isa Ismaila Waziri, the Chief Executive Officer of agrictech startup, Agrikoin, noted that small-scale farmers throughout the country’s agricultural value chain are hampered by various difficulties, especially, the lack of finance and market access.

Therefore, agritech companies need to have a realistic approach to revenue generation. For instance, digital agricultural solutions that require farmers to pay user fees from the onset are less likely to scale rapidly, limiting their investment potential. This is because investors are more likely to work with agritech companies with a clear revenue model and a value proposition that addresses multiple pain points along a value chain.

Agritech companies should patiently engage with investors to further explain the benefits of their digital solution and related business opportunities, while investors may need to think of alternative models for agritech investments.

Also, startups need to educate investors about their unique business proposition and the agritech sector in general, before demonstrating the opportunity for both sides to benefit from the investment.

Such engagements may take time and government support should be available at the state or local levels as extra government intervention may help to increase investment in agritech. For instance, providing tax exemptions for early-stage investments could incentivize additional local investment in the sector and tech as a whole.

Beyond specific support through agriculture or agritech-related policies, the government should encourage the growth of many of such companies in Nigeria that are keen to provide farmers and crop buyers with a digital payments solution.

If truth be told, the current regulatory framework has hindered the growth of mobile money, which is well placed to offer financial services to rural or financially excluded communities.

In addition to revamping the country’s financial and digital infrastructure, improving the country’s physical infrastructure can especially benefit the agricultural and agritech sectors. Many agritech companies have to invest in logistics (i.e. warehousing, transportation) to provide services to farmers, including access to markets.

Infrastructural upgrades will mean a reduction in the cost of moving goods around, improving start-ups’ margins and revenue. This transformation, which will be critical to improving the ease of doing business in Nigeria, has significant potential to attract investment to the agritech sector.

There are numerous growth potentials for farmer organizations to increase productivity only when they can access finance. As such, access to finance is not only a necessity but an urgent quest, a quest that will enable farmer organizations to increase yield and ensure food security.

No farmer organization can be viable when these issues are not addressed and tackled, and this is only possible through profiling the performance of these farmer organizations and assessing their risks management. Doing this will help to identify and create creditworthy farmer organizations with low management risks.

It is therefore not surprising that the AgriKoin CEO appealled to the federal government and other relevant agencies to provide the necessary support to enable Agrikoin to deploy their distinctive agricultural financial services for the benefit of Nigerians and the growth of the country’s economy.

The National Information Technology and Development Agency (NITDA) has been playing a crucial role in supporting and creating a conducive ecosystem for startups to prosper in Nigeria, ranging from the establishment of incubator centres like the National Centre for Artificial Intelligence and Robotics, and the National Digital Innovation and Entrepreneurship Centre.

In conclusion, I call on NITDA and other relevant agencies of government to do more by providing all the necessary support to enable agrictech companies to deploy their innovative financial services for the benefit of Nigerians and the growth of the digital economy.

Abbas Badmus is a staff of TechDigest and write from Abuja

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