Welcome back to a new edition of our Newsletter, this time from Ethiopia where I met up with the entire Impacc team (we are a dozen by now, spread across three countries with a tremendous mix of expertise and passion). It’s always such an energizer to leave Zoom behind and connect in person. We used our time in the south of this beautiful country to hook up with many budding entrepreneurs that create business solutions to tackle big problems: food waste and nutrition through banana flour, for example, or lack of opportunities for mountain people through reviving the old art of weaving for an international market. The trip made me think back to all the great businesses and entrepreneurs we had the privilege to support since my last newsletter.
Building a business that tackles climate change
Take Marbi Agric, for example: Founder Bernadette Mwanza started out providing credit-financed seeds for smallholder farmers. But recently, she has invested heavily in the chicken-brooding part of her business. You can see why: it makes great business sense for her and her >4,500 customers, and it’s a good way to adapt to climate change as well: I know chicken can’t save the world. But for smallholders in East Africa it does make a difference if they focus on crops that no longer grow reliably or shift to raising chicken that lay eggs every day no matter what. And I am grateful to our venture Marbi Agric for having the business acumen to shift their model and adapt to new realities. Well, maybe we can actually change the world, one chuck at a time.
Me meeting the chicken of Marbi Agrics Partners.
Or take M-Shamba, the simple digital platform that creates markets for smallholders across East Africa. Smallholder farmers produce the vast majority of the food across Africa, but they are often the poorest and, tragically and ironically, go hungry. That’s why people like Calvince Okello, founder of M-Shamba, have such a powerful impact.
I saw him in action in central Kenya some time ago, signing up another 100 farmers to his platform that provides market access. Their problem: everyone produces at the same time, harvest prices are low and middlemen cut out any remaining margin. His solution: line up and secure demand beyond the region, make it easy for farmers to sell via an automated sms-based order system, offer them a guaranteed price range and train them (again via sms or interactive voice) to improve quality.
50,000 farmers have already signed up, 23 of 47 Kenyan counties are customers. I have seldom seen such a powerful business: great entrepreneur, smart and simple business model, real traction, and HUGE impact: one farmer told me he almost tripled revenue on his potatoes since working with M-Shamba. I am eager to see which business in the North we can line up to get inspired by his use of low-tech to capture previously unserved markets.
Calvince onboarding new partnering farmers.
Financing continues
In recent years, Gjenge Makers has managed to close further investments across our portfolio of startups: in the summer, Gjenge Makers will double their production capacity and move into bricks for housing. In the winter, ACT will expand their activities, creating jobs, getting rid of hundreds of thousands kilos of fashion waste, and showing us all the power of the circular economy. And the next in line is M-Shamba, which we will hopefully sign in the next weeks. This will allow them to reach the other half of Kenya’s counties and build digital payment options for smallholders which will help them hire harvest assistants. If we continue to go at this scale, our current generation of startups will be funded by the summer, and we can select a new generation, a process we are kicking off in March.
The Impacc team meets in Ethiopia
Strategy Workshop of Impacc team.
Which type of startups to select this year was one of the topics of our Impacc Team Offsite meeting that we have just concluded in Ethiopia, from where I write these lines. How to communicate our approach in a way that incorporates both African and European perspective and how to leverage our diverse team so that everyone can give their best were others. Our team spends most of the year connecting remotely from Nairobi, Addis, Berlin, Munich, Hamburg, so it’s a great luxury to meet, discuss, fight, laugh, plan and party twice a year in person. This time it was in Arba Minch in Southern Ethiopia where we planned out the year (we want to fund ten startups and create 1,000 jobs, amongst others) and got energized for the months ahead. I wish you all the same energy we left with when we said goodbye yesterday!
Stay safe,
Till
