of funding from the Foreign, Commonwealth, and Development Office (FCDO) to establish AgDevCo Ventures,){kind=link}
AgDevCo is very pleased to announce £25m ($32,688,625m)of funding from the Foreign, Commonwealth, and Development Office (FCDO) to establish AgDevCo Ventures, a new investment strategy in the group.
AgDevCo Ventures will make smaller investments 980,730 – 3,269,075 million early-stage agri-SMEs and with the aim of building the next generation of African agribusinesses. Initially, the fund will invest in East African countries where AgDevCo is already present (including Kenya, Uganda, Tanzania, Rwanda) then expand to other countries and regions.
According to AgDevCo CEO, Daniel Hulls:“We are very grateful for the continued support from the UK government. This funding will allow us to leverage third-party capital and go back to investing in small, early-stage businesses. We are excited about building the Ventures portfolio and expect it to be to be high impact, delivering jobs and increased rural incomes and helping to build the next generation of African agri-SMEs.”
AgDevCo Ventures will support the development of commercial agriculture on the continent, achieving impact through job creation and by linking smallholder farmers to market opportunities.
FCDO’s backing will enable AgDevCo Ventures to invest in small agri-SME investments in the “missing middle”, where private investors are often deterred by high risks and transaction costs. The portfolio is expected to include a high proportion of African and female-owned or managed businesses
AgDevCo’s return to this part of the market, where we operated from 2009 to 2017, is made possible by our move to profitability, having rebalanced our portfolio in recent years with larger investments in more established businesses.
AgDevCo Ventures will be a ring-fenced investment subsidiary within the AgDevCo group, with a dedicated team based in our Nairobi office and drawing on specialist expertise from across the organisation. We are in the process of raising a further £20m of impact investment capital from development finance institutions and family offices, with the expectation we will start operations in early 2025.
The UK Minister for Africa, Lord Collins of Highbury said:“Improving food markets will have a game changing impact on individuals and families across Africa. Giving hard working farmers stable incomes, creating jobs for the youth and helping end malnutrition. Without access to funding, no matter the drive and ingenuity, too many businesses can’t get off the ground. That’s why I’m pleased to announce that the UK intends to back a new $50 million facility called AgDevCo Ventures. The UK will put in over half the funds, with AgDevCo collecting funds from other investors. AgDevCo’s funding and expertise will enable early-stage African agribusinesses to grow and increase Africa’s resilience to climate change.”