African agricultural fintech secured lowest VC funds in 2021 (GRAZE)


(Ecofin Agency) – Agricultural fintechs are companies that offer technological solutions to enable financial institutions and rural actors to access financial information, offer or receive loans, manage agricultural operations or market agricultural products. In 2021, these startups operating in Africa secured an investment of US$75 million. The amount was the lowest in the world, but is higher than the amounts the continent collected in 2019 and 2020.

The African agricultural fintech raised the lowest volume of venture capital in the world in 2021, according to a recent report published by the consulting firm Graze.

While the North American agri-fintech raised US$650 million in venture capital that year, their Latin American and European counterparts raised US$214 million and US$124 million, respectively. Meanwhile, the African agricultural fintech has raised just US$75 million.

Although the amount is relatively lower than the volume raised by other continents, it is significantly up from its 2-year level. Indeed, from US$1 million in 2019, the volume of venture capital raised by African agro-fintechs increased to US$10 million in 2020 before its sharp rise to US$75 million in 2021.

The number of closed deals also increased from 3 in 2019 and 2020 to 16 in 2021. Twiga Foods captured the largest share of the amount raised with US$50 million. It was followed by SunCulture, which got US$14 million.

Overall, venture capital investments attracted by agri-fintech globally accounted for only 1% of the US$600 billion in venture capital investments secured globally in 2021.”Generally speaking, investors remained worried about agriculture as it is seen as a high risk sector“, commented the founder of Graze, Niall Haughey.

Note, however, that the volume of venture capital investments attracted by agrifintech worldwide has been rising sharply since 2019.

Chamberline Moko


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