Earlier this year the Catalyst Fund hosted an insightful breakout session on feeding the future and innovating food systems at the Africa Climate Tech Festival in Nairobi, Kenya. Moderated by Rebecca Mincy, Investment Director at the Acumen Resilient Agriculture Fund, the session brought together a diverse set of stakeholders, including agtech entrepreneurs, investors, and thought leaders.
A key takeaway from the conversation was around the critical need for more and bigger investments into companies and solutions that are transforming Africa’s food systems. As Eli Pollak, Founder and CEO of Apollo Agriculture noted, businesses like theirs require substantial amounts of both equity and debt financing to scale impact for smallholder farmers across the continent. He called upon investors to ramp up their activity with larger ticket sizes and more urgency in the space.
Another area requiring increased capital flow is credit provision to smallholder customers. Innovators like Apollo Agriculture provide inputs and advice to farmers on credit, which allows them to access quality seeds, fertilizers, and technologies critical to climate-resilient farming. However, the risk and working capital required to lend directly to rural smallholders at scale is extremely high. Eli suggested exploring partnerships and innovative models where financial institutions can leverage their lower-cost balance sheet capacity to extend credit, while agtech innovators like Apollo can apply their in-depth customer insights and field teams to acquire, underwrite, and support borrowers on the ground.
Besides access to finance, Maurice Kimani, of InsectiPro and Dr. Starlin Farah of startup Ecodudu discussed how insect protein, especially from black soldier fly larvae and crickets, can greatly enhance feed efficiency, reduce reliance on expensive protein sources like soy and fishmeal, and minimize environmental footprint relative to traditional livestock rearing.
Francis Nderitu, CEO of startup Raino, also discussed innovations his company is bringing to enable poultry and fish farmers to maximize harvests and reduce post-harvest losses through integrated service solutions. However, driving user adoption of new solutions requires overcoming substantial upfront behavior change barriers across smallholder value chains. Kimani noted his company overcame such reluctance by inviting first-time visitors to their insect farm to sample crispy critters before entering!
Building on the challenges of driving farmer behavior change, Pollak emphasized that the most readily scalable solutions are often those that do not require significant modifications to existing practices. As an example, he explained how switching maize farmers to faster-maturing, drought-tolerant hybrid varieties is relatively simple compared to convincing them to plant entirely different crops. While not always possible, the ideal innovation minimizes behavior change requirements while still moving the needle on profitability, climate resilience and environmental sustainability.