Foreign venture capital news | cut the price of bananas in Africa to a quarter, and African food supply chain company Twiga Foods has received $50 million in Series C financing

According to TechCrunch, African food supply chain company Twiga Foods has received $50 million in Series C financing to expand its market share in East African countries. The round was led by private equity firm Cradev, with the participation of companies such as TLcom, IFC Ventures, DOB Equity, Juven, Finnfund Global and Endeavor Catalyst Fund.

Twiga Foods was co-founded in 2013 by Grant Brook and Peter Njonjo in Nairobi, Kenya, to build an integrated African food supply chain system. When founder Grant conducted a banana export survey many years ago, he found that bananas sold to Nairobi on a banana farm within a hundred kilometers of Nairobi were sold at similar prices to those imported to London from other continents. When he delved further, he found that the fragmented supply chain was the root cause of the high price of agricultural products, and Grant also found that there were huge development opportunities behind this problem.

Small-farm agriculture remains a major contributor to Africa's GDP, with more than 80 per cent of Kenya's workforce currently engaged in agriculture-related work, while more than 75 per cent of local produce is provided by more than 3 million family farms. At the same time, due to the imperfect infrastructure and asymmetry of information, food (mainly referring to fruits and vegetables) from the farm to the hands of small traders has to go through at least five or six intermediate links, not only the price is rising steadily, but also the longer time consuming caused by inefficiency has also led to a decline in food quality.

Image source: The company's official website

Founded in 2013 in Nairobi, Kenya, Twiga Foods first began to develop from the banana supply chain, and in just two years, Twiga has become the largest banana sales channel in Kenya, selling more than 20 tons of bananas to more than 1,300 vendors in Nairobi every day. Nowadays, Twiga can provide more merchants with a variety of agricultural products, such as potatoes, tomatoes, onions, etc. Currently, more than 100,000 customers across Kenya use its services, while delivering more than 600 metric tons of products to more than 10,000 retailers a day, according to Twiga's website.

The continued spread of the COVID-19 pandemic since 2020 has disrupted the company's sales rhythm, causing the company to shift its profit focus to online e-commerce platforms. In May 2020, Twiga partnered with e-commerce platform Jumia to provide buyers with a safer and more affordable way to access food.

Under its partnership agreement, Jumia will sell Fresh Twiga produce on its e-commerce site. Jumia's delivery team will pick up the goods from Twiga's sorting and distribution centers and then complete the contactless delivery for the last mile.

It is reported that the round of financing will be used for further expansion of the market, and the target markets currently identified are Côte d'Ivoire, the Democratic Republic of the Congo, Ghana and Nigeria.