Kenyan mobile-based B2B fresh produce distribution platform Twiga Foods has raised $7m from the World Bank Group’s International Finance Corporation (IFC) and venture capital firm TLCom Capital Partners.
Twiga Foods is an online platform is a wholesale marketplace for producers and wholesalers or fruit and vegetables. We reported in August last year, when Twiga secured $10.3m in Series A funding, that the company operates like a buying group by consolidating the purchasing power of small and fragmented urban retailers.
In 2017, the company claimed to be the largest distributor of several basic food staples in Kenya and had sold more than 55m bananas, and was fulfilling around 4,000 orders a week. In the latest release, Twiga Foods claims to have sold more than 200m bananas and to work with 2,600 vendors.
The IFC is set to invest $3m, while TLCom will invest up to $4m. The use of digital platforms to improve efficiency in the supply chain for food is a hot topic across East Africa, and helps explain the soaring value of Twiga Foods.
Systemic problems in the value chain include high levels wastage as food goes from farm to consumer, overly long supply chains (often involving sensitive produce being handled by many people), wide variations in prices across regions (and seasons), and a lack of transparency for farmers and wholesalers alike.
A recent research report has found that Kenyan startups dominated fundraising in Africa in the first half of 2018 – five of the top ten highest funded African startups over the period. These were digital payment company Cellulant, mobile lending app Branch, solar energy company M-Kopa Solar and comms and payment software company Africa’s Talking, as well as agritech startup WeFarm.
WeFarm describes itself as “a free peer-to-peer service that enables farmers to share information via SMS [.. on which] farmers can ask questions on farming and receive crowd-sourced answers from other farmers around the world in minutes.” Together, these five companies raised $91m, more than half the $169m raised across 118 deals in Africa in the first half of 2018.
