Kenyan based aquaculture entity Victory Farms clinches US$5m funding to expand into new markets

KENYA – East Africa’s largest commercial fish farm, Victory Farms, has raised US$5 million in new funding to facilitate its expansion in Rwanda, DRC and Tanzania.

The investment was led by Ed Brakeman, a senior managing director at Bain Capital and Hans den Bieman, founder and ex-CEO of Mowi, one of the largest salmon businesses globally.

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This is the startup’s first institutional investment following seven internal angel rounds from the same set of equity–and debt investors (it raised US$40 million in debt last year).

It includes the multi-million-dollar mezzanine debt investment from social impact investor specializing in the African agriculture sector, AgDevCo, channelled towards construction of a feed mill.

Victory Farms was launched in mid-2016, having its own hatchery, nursery ponds and deep-water cages in Lake Victoria plus a processing plant, to serve a market with about a US$1.5 billion fish deficit.

With a large fish deficit and retail prices reaching US$5 per kilo, the aquaculture startup uses technology to produce more fish and drive down costs simultaneously for the thousands of market women who buy fish in small batches to cook and sell in local food markets.

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“We run a tech-enabled platform and have scaled 2x faster than any other African fish company. And using data, we have built the most efficient operation globally at half the capex of current global leader.

“We sell to mass market Africans via a high innovative RTM cold chain which uses predictive data to push fish to thousands of market ladies every day all across Kenya with less than 1% spoilage,” said Joseph Rehmann founded Victory Farms.

The company has more than 54 retail locations where over 15,000 market women go to buy fish, and according to Rehmann, they use no electricity nor ice.

“We use vertical integration to drive a more robust data set from end to end,” he said. “This allows us to innovate and create more cost-effective solutions through our systems and the power of data to deliver a better, fresher product to more consumers.”

Victory Farms claims to have one of the highest margin structures in the fishing industry globally due to its technology. The company recorded a 130% CAGR between 2017 to 2021.

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As much as Victory Farms is profit and growth-oriented, Rehmann said it is worth highlighting that the company is working toward becoming the world’s most sustainable tilapia platform.

“We’ve got several initiatives underway and planned to build the world’s first carbon negative fish platform. And I think it’s very exciting because we’ve got a lot of tangible and measurable dimensions built into the business to achieve that,” he highlighted.

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