KENYA – Twiga Foods, a Kenyan online food distribution platform has received a US$5 million loan from the United States International Development Finance Corporation (DFC) to improve food security in Kenya.
The investment from DFC seeks to empower smallholder farmers and urban produce vendors, especially women to have access to markets and also to improve the agricultural supply chain with cold storage, by enabling Twiga Foods to buy additional transportation and cold storage equipment.
DFC’s investment in Twiga supports its 2X Women’s Initiative by empowering a network of mostly female produce vendors to increase sales and profits.
The initiative has already catalyzed more than US$1 billion to economically empower women across the developing world.
“Twiga is advancing an innovative solution to create economic opportunity particularly for women, while ensuring dependable and affordable sources of food across Kenya,” said DFC Managing Director of Global Women’s Issues Charity Wallace.
“DFC is proud to support this project, which will help strengthen food security and unlock untapped economic potential across Kenya,” she added.
Twiga operates collection centres across Kenya, and also a central packhouse with cold storage facilities.
It owns a fleet of mobilized trucks and vans for collection and distribution of produce, thus creating an efficient logistics system that limits its post-harvest losses to 5%, compared to 30% at informal markets.
Twiga Food’s main objective is to link farmers and vendors to fair, trusted, modern markets. It also aims to provide a complete supply chain in Kenya for quality produce in urban areas.
The financing comes months after Goldman Sachs, American multinational investment bank acquired stake in the food distribution platform in October last year, following a Sh2.44 billion (US$23.75 million) deal aimed to widen its footprint in Kenya and Africa.
Marking Goldman Sachs’ first major deal in Kenya, it entailed providing funding to the start-up together with three other Twiga Foods existing investors i.e. International Finance Corporation (IFC), venture capital firm, TLCom Capital, and French private equity fund Creadev.
During the Series B equity round an additional US$6 million in debt was raised from OPIC and Alpha Mundi.