Tech in Africa
Acumen has closed a $58 million fund fixated on climate change adaptation for smallholder farmers. Acumen runs the Acumen Resilient Agriculture Fund (ARAF), an impact investment organization funded by the Netherlands Development Finance Corporation (FMO), the Children’s Investment Fund Foundation (CIFF), the Soros Economic Development Fund (SEDF), Global Social Impact, the Ikea Foundation, and Proparco.
Tamer El-Raghy, ARAF’s Managing Director pointed out that the $58 million close was $8 million more than their initial target describing the development as a “watershed moment.” With 5% of climate investments directed towards adaptation, this signaled a shift in climate finance. Through investments in agriculture startups across East and West Africa, ARAF hopes to build climate resilience, reduce poverty, and demonstrate the impact of investing in resilient agriculture.
First investments
Climate change in Africa is directly impacting small-scale farmers and producers who provide 80% of the food consumed. In response, ARAF began operations in 2020 by investing in 5 companies running operations in Uganda, Nigeria, and Kenya, The fund has several schemes targeted at supporting African farmers.
Blended finance
The fund deployed this model to offer long-term support to SME businesses through a $5 million Technical Assistance Facility (TAF) designed to provide farmers with practical support. TAF is funded through grants from the CVF, the Ikea Foundation, FMO, and the UK Commonwealth and Development Office (FCDO).
Source: Acumen
