KENYA – Kwanza Tukule, provider of socially and economically empowering food supply services in the low-income areas of the Kenyan capital, Nairobi has received investment from DOB Equity, Elea Foundation and A to Z Impact.
The last-mile distribution business, supplies informal food vendors with staple foods to cook meals for their customers.
It has set itself as a cashless, B2B business using technology to ensure there is accessible, affordable and nutritious food for the many people that work and live in low-income areas in Kenya.
The company was founded in 2019 by Khadija Mohamed Churchill after she identified an opportunity to create a more efficient last-mile distribution system for the informal vendors based in densely populated areas of the city.
It is estimated that 25% of Kenya’s population lives in cities, expected to rapidly increase to 40% in 2040.
Most of the urban population live in informal settlements – these areas are cut-off from modern and efficient food supply chains.
Informal food vendors and dukas (small retail shops) have filled this gap, providing access to low-cost food to the people living in these settlements.
This is because, most of the urban dwellers lack kitchens and the money for proper cooking equipment and face long commutes to work. They therefore depend on street food vendors for affordable and accessible meals.
“People living in urban centers in Kenya get 33% of their nutritional intake from street food. For low-income neighbourhoods more than 40% of households consume street food and 80% of the food vendors are women,” said Khadija.
Kwanza Tukule’s services are paramount as estimates suggest that residents of informal settlements in Nairobi consume street food on average four times a week.
The total number of food vendors in Nairobi is estimated to be around 50,000 and this is the market the company is tapping into.
Despite their importance in feeding a significant part of the city’s population, informal food vendors face difficult operating conditions. These include expensive and unreliable supplies and limited economies of scale.
Saskia van der Mast, Co-CEO of DOB Equity, said, “We are excited by Kwanza Tukule and its team led by a strong, local and female CEO. The company is addressing key issues of some of the most marginalized communities in urban settlements.
“Kwanza Tukule has achieved considerable growth in its first year of operations and a loyal customer base.”
DOB, one of the first institutional investors in Twiga Foods in 2016, is a Dutch family-backed impact investor has a keen eye on the East African market.
Maina Murage, Investment Professional at DOB, said, “An investment in Kwanza Tukule expands our portfolio of food distribution and logistics in East Africa.
“Food security in urban areas where people can spend more than 50% of household income on food is an area of interest for DOB Equity.”
As part of its recent investments, DOB Equity lent its support to Mr. Green Africa, a Kenyan plastics recycling pioneer, to scale its business model across the continent.
In November 2021, the investor made a repeat investment in Twiga Foods, during its US$50 million Series C funding round.