KENYA – Kenyan agri-tech startup Stable Foods has raised a US$600,000 round from Acumen Resilient Agriculture Fund (ARAF) and Mercy Corps Ventures, to build out its climate-smart smallholder food production platform.
Stable Foods, a portfolio business of the agrifood-tech venture firm Pyramidia Ventures, has created an integrated solution that includes Irrigation-as-a-service, provision of inputs, access to market, and training on regenerative agriculture.
These services are offered as a menu to smallholder farmers, allowing them to layer solutions as suits their individual needs.
The proceeds of the round will be used to scale up Stable Foods’ proof of concept to 500 farmers by the end of 2023.
“We are thrilled with this round of funding in our very first venture coming out of the studio.
“ARAF and Mercy Corps Ventures are fully aligned with Stable Foods’ mission and we could not be prouder of the entire Stable Foods team for getting such high-quality partners on board,” said Ruth Bertens, founder and managing partner of Pyramidia Ventures.
Food systems in Africa are plagued by two central problems: high food prices and subsistence level income for smallholder farmers.
These two realities are major contributors to food insecurity on the continent, with upwards of 50-80% of household incomes spent on food consumption on the continent.
Low yields for farmers, income instability, fragmented value chains and extractive monoculture agricultural practices are among the critical factors contributing to these problems at either end of the chain.
Yet, Africa has the potential to improve agricultural productivity 4-5X mainly through yield improvements by smallholder farmers.
Stable Foods unlocks this hidden smallholder potential at scale with its wide range of solutions.
“Stable Foods is another great addition to ARAF’s portfolio companies where we invest in innovative business models that help smallholder farmers adapt to climate change.
“The negative impact of climate change on rain patterns can’t be overstated and we believe that the Irrigation-as-a-Service solution that Stable Foods is offering represents a revolutionary service in the market,” says Tamer El-Raghy, Managing Director of Acumen Resilient Agriculture Fund (ARAF).
ARAF is sponsored by Acumen, anchored by the Green Climate Fund, and supported by FMO, the Soros Economic Development Fund, PROPARCO, the Children’s Investment Fund Foundation, Global Social Impact, IKEA Foundation, and others.
According to Daniel Block, Investment Principal at Mercy Corps Ventures, it is widely accepted that there is a massive productivity gap in smallholder farming and implementing irrigation is known to catalyze increases in yields and income.
Yet, fewer than 3% of smallholders access irrigation today, primarily due to lack of affordability.
“Leveraging shared capex through networked irrigation solutions, Stable Foods has proven economies of scale can drive down the cost per unit for farmers and make irrigation work for even tiny plots of land at a price point that is very affordable to any smallholder.
“We often think of innovation as a new technology, though sometimes – and Stable Foods gets this – redesigning existing systems and executing to solve a true customer pain point is the most successful innovation of all,” Daniel said.
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