News
Small Foundation is pleased to announce our support for AgDevCo Ventures, a vehicle providing patient finance to early-stage agribusinesses across East Africa.
Early-stage agribusinesses often struggle to access finance that matches how their businesses operate. Their capital needs may be too large for microfinance, while commercial lenders may consider them too small, too early or too exposed to agricultural risk. Seasonal revenues, climate shocks and long production cycles can also make standard loan terms difficult to manage. This financing gap can limit the growth of businesses that provide agricultural inputs, buy and process produce, connect farmers to markets and create employment in rural areas.
AgDevCo Ventures has been established by AgDevCo, an impact investor operating exclusively in Africa’s agricultural sector. Small Foundation was an early supporter of AgDevCo, providing core funding during its formative years.
AgDevCo Ventures is set to provide patient finance to businesses involved in input supply, production, aggregation and processing across East Africa. The vehicle will also provide technical assistance in areas such as financial management, agronomy, environmental and social practices and inclusive business development. A dedicated team based in Nairobi will manage the portfolio, supported by AgDevCo’s wider agricultural and investment experience.
“Small Foundation was one of AgDevCo’s earliest backers and has been just as catalytic in getting AgDevCo Ventures off the ground. Its capital commitment – and the conviction and speed behind it – took us over the line to begin investing. We are grateful for that support and look forward to putting it to work alongside that of our other investors, building a portfolio of early-stage agribusinesses that create income and opportunity in rural Africa.”
– Daniel Hulls, AgDevCo CEO and AgDevCo Ventures Chair
Small Foundation’s support forms part of a broader blended finance structure that allows AgDevCo Ventures to provide financing on terms better suited to early-stage agribusinesses. We are interested to explore how this combination of flexible finance, sector knowledge and practical business support can help viable businesses overcome the constraints that prevent them from growing.
The partnership also creates an opportunity to learn whether businesses supported at this stage can strengthen their operations, expand their relationships with smallholder farmers and better position themselves to access further investment. For Small Foundation, this is relevant to the wider question of how finance can more effectively reach rural enterprises that are commercially promising but remain underserved by existing investors.
