Farmerline, an agritech startup based in Ghana, has raised $12.9million ($6.4m equity & $6.5m debt) to improve its infrastructure. This includes warehouses and distribution channels.
Africa can meet its own food requirements as well as those of the rest. The continent is home to 60% of the world’s arable land. Its agricultural sector plays a vital role contributing approximately 60% to the global arable land. 14% to the GDP (Sub-saharan Africa) and employing a substantial portion of the population.
However, there are many challenges facing the sector that hinder its growth. They include low quality farm inputs and dependence on rain-fed farming, as well as lack of access to technology and best farming techniques.
Farmerline, an agritech startup in Ghana, has stepped up to fill these gaps. Farmerline is deploying technology to improve farmers’ access to high-quality production inputs, education on the best farming practices and how to navigate the effects of climate change.
The agritech startup solutions were founded by Alloysius Atah and Emmanuel Owusu Addai in 2013. They are designed to help farmers get to markets quickly for higher incomes and reduce post-harvest losses and waste.
Farmerline’s new funds will allow it to accelerate the implementation of its plan to reach 300,000. farmers by 2022. It will also expand its operations in Ghana and other neighboring countries, such as Ivory Coast.
Acumen Resilient Agriculture Fund and FMO (the Dutch entrepreneurial development bank) led the equity round. Greater Impact Foundation also participated. Ceniarth Foundation, Rabobank and Ceniarth were the debt lenders.
Alloysius Athtah spoke out about the fundraiser and said that the agritech would use its first equity financing to build physical infrastructures such as warehouses or distribution networks.
“We think of ourselves as the Amazon of farmers. A digital and physical infrastructure powering a marketplace that allows the movement of goods and services to and from rural areas,” said Attah.
“We plan to use the funding to strengthen our infrastructure, that is warehouses and distribution channels. It is essential that we have a network of partners who can assist us in moving inputs such as fertilizer, seeds, and farm products from rural areas quickly. We don’t intend to bring all of the logistics and storage in-house, but we want to be more efficient and that means working with the right partners,” he said.
Farmerline is currently a partner with agribusinesses, which are usually small retail shops that stock farm products. This partnership ensures that farmers have access to high-quality supplies. Farmerline uses these shop owners as a source of information for farmers and gathers them together for training.
The partnering shops use the startup’s Mergdata this platform uses AI technology to create supply chain intelligence. It digitizes farmers and generates the data that agritech requires to forecast the demand for farm supplies.
“We are tapping into that network of agribusiness, and in a way, we are tapping into a network of trust — the relationship that these shop owners have with farmers to help us expand,” said Attah.
The partnership with retailers emerged after Farmerline realized that working directly with the farmers would amount to “competing with local businesses, and it didn’t make any sense. The cost of going door to door to each farmer was really high,” he said.
“Working with the agribusinesses made our businesses scalable, and it also helped us make more impact, especially during the pandemic when we couldn’t travel — they became our eyes and ears on the ground. We sent them trucks full of fertilizer, seeds and other supplies that they would then give out to farmers. That model worked really well.”
Farmerline uses Mergdata to assess the performance of their partners agribusinesses (retail stores) and create a credit scoring program that guides business expansion loans.
The co-founder said that the startup has more than doubled its reach to farmers in 2021, from 36,000 farmers in 2020 to 79,000 in 2019. Benin, West Africa, uses this platform to provide information about its national markets.
Mergdata has been digitized by the agritech in 26 countries around the world through third-party licensing. 180 clients use Metadata, including non-governmental organizations (governments) and agri-companies, to trace their supply chains and ensure transparency.