Agricorp International, a Nigeria-based spices producing, processing, and exporting company has raised $17.5 million in pre-series A funding. With this new raise, Agricorp will increase its spices processing capacity up to 7000 metric tonnes (MT), expand into new markets, hire more talents and build more processes that enhance global food systems.
Nigerian-based Vami Farms led the funding round with $11.5 million in equity funding, with support from UAE-based international trade and investment company One Capital. AFEX also provided working capital financing to Agricorp. Ernst & Young (Nigeria) served as transaction advisers, while Elisio Law Office and Pavestone Legal served as legal advisers.
Founded in 2018 by Kenneth Obiajulu and Wale Omotimirin, Agricorp supports smallholder farmers with inputs and training on good agronomic practices and its 0.5MT/hour processing plant in Kaduna, Nigeria processes and packages farm produce for the export market.
A recent report shows that between January and March of this year, agriculture contributed to 22.35% of the total GDP and over 70% of Nigerians engage in the agriculture sector primarily at a subsistence level. But a majority of these farmers are largely undocumented and unbanked, especially farmers who reside in rural communities.
Agricorp’s proprietary technology helps in creating financial profiles for unbanked farmers
Agricorp is one out of a handful of agrictech startups developing and deploying technology to change that narrative. The company uses its proprietary technology, Farmbase, to create detailed profiles and financial flow for farmers by registering, aggregating, and paying them for their produce.
According to the company, data collected through Farmbase provides key stakeholders, such as government agencies, agribusinesses, and private companies, detailed insights that enable them to make informed agricultural decisions.
Farmbase also tracks farm-based activities like disbursement, product sales, and payment history. Financial institutions can also use this information to provide loans, credit facilities, and insurance to interested parties. Farmbase, in short, is developed to aid the complete value chain of the farming process.
According to data from Nigeria’s Ministry of Agriculture and despite being the third highest exporter of ginger globally, Nigeria’s ginger production is put at 31 million MT while demand is estimated at 65 million MT, leaving a gap of 34 million MT. While Nigeria accounts for more than 16% of the global production of ginger, it gets less than 4% of the export market share.
Agricorp aims to stand at the forefront of enhancing global food systems and plans to use the $17.5 million investment to contribute to meeting the growing demand for spices as an export material.
“We believe that by increasing our capacity to 7,000 MT, we will maximise the potential to boost Nigeria’s forex earnings through export, contribute our quota to improving the Nigerian GDP from agriculture, and serve as a worthy model to African youth who aspire to be agribusiness owners.” Kenneth Obiajulu, Agricorp’s Co-Founder and CEO said in a statement.
Since its launch — less than 3 years — the company has supported over 5,000 smallholder farmers. The company also says it has grown its revenue by over 585% to service global clients in the food processing and pharmaceutical industry.
Obiajulu, who is also the co-founder of One Capital, said Agricorp was intentional about choosing the right funding partners for this round.
“We wanted strategic partners that would allow us to grow our business and impact, not just see us as a portfolio in their investment mix.” He added.
According to Lead Investors, Vami Nigeria, they led the funding round because they saw in the startup a clear growth path, strong social impact, solid financials, and global collaborations with key partners. Most importantly, “the unrivalled depth of knowledge, passion, and resilience of the Agricorp team.”
“We have transacted with Agricorp on several occasions and have seen the business grow over time. Now, we are committed to providing the working capital they require, through our investment arm, to scale their operations at any level,” Samirah Ade-Adebiyi, Managing Director at AFEX, said in a statement.