FarmWorks in Kenya receives $4 million in pre-Series A investment
FarmWorks has secured $4.1 million in a pre-Series A round. FarmWorks is a Kenyan agtech that gives farmers access to farm inputs and a market for their output. An existing investor, Acumen Resilient Agriculture Fund, led the round. FarmWorks has received $5.6 million in equity capital from the Livelihood Impact Fund, Vested World, a few family offices, and angel investors.
Funds Utilization:
FarmWorks CEO Yi Li, who co-founded the firm in 2020 with Peter Muthee, said that financing would be used to boost their data analytics skills. It will also leverage AI to improve production and impact planting and loan choices.
FarmWorks Long-Term Goal:
FarmWorks operates an out-grower program that brings together over 2,000 smallholder farmers. It develops a supply chain network that assures timely delivery of high-quality products. It intends to expand its network of contract farmers in other parts of Kenya and to the two counties in the central area, where it is already functioning and has 16 collecting centers.
Facilities at FarmWorks:
The firm offers farm supplies and pest control services. In addition, it provides farmers with the opportunity to sell their products both locally and internationally. It also lends them farming equipment such as drip irrigation systems. Every month, the firm sells around 400 tons of agricultural food.
“We are transforming what they are farming, and their income by introducing higher value crops like sugar snaps and snow peas and finding the market. So, we become vertically integrated from day one in both the production and the distribution side of the business,” said Li.
In addition, the firm trains farmers in appropriate agricultural practices. The firm has its experimental farms. FarmWorks originally produced crops on its farms, which it has since converted into training facilities.
“There’s a lot of operational expenditure in running a big farm, and we realized that for the same efforts, we can cover a lot more farmers. That is why this year, we made a strategic decision to scale our out-grower scheme because that seemed to pick up much faster. We will be using our farms as training centers,” said Li.
Transforming the Kenyan agriculture sector:
According to the study, the firm is filling holes in the Kenyan agriculture sector. It accounts for 20% of the country’s GDP and employs 70% of the population in rural regions. While agriculture remains a critical sector for the Kenyan economy, most small-scale farmers face numerous challenges. It lacks quality farm inputs, information on good agricultural practices, insufficient advisory support, and unpredictable or unreliable markets.
“We have a strong belief that the huge issue facing farmers in Kenya is production — the low yield is mainly due to poor farming practices, and soil degradation that has happened over the years,” said Li, who added that the startup is unlocking production and by boosting farmers’ capacity.
