Releaf, a Nigerian agritech startup, has acquired $3.3 million in a pre-Series A investment that was marked up. Releaf provides ingredients—starting with oil palm—to makers of consumer goods and associated food factories.
The Kraken II and SITE launches will be supported by the $4.2 million (including a $1.5 million grant) seed capital, according to the business funded by the Jack Ma Foundation.
To provide smallholder farmers with greater processing yields and lower transport costs, Releaf focuses on value chains wherein smaller manufacturers are positioned close to them. Releaf’s first and only crop at the moment is the oil palm, which has a $3 billion market with more than 4 million smallholder farmers.
“The biggest benefit to them [farmers] with this new evolution of Kraken and SITE is that many offer farmers poor prices because they have to pay a lot for logistics. But now that we can eliminate 80% of the logistics costs and process much closer to the farmers, we can pass a lot of that profit back to them while also keeping more of it for ourselves while improving even the quality of the end product,” said Ayogu, who co-founded Releaf with CEO Ikenna Nzewi on why this new technologies matters for farmers.
The Kraken II is a portable, less-priced variation of the palm nut de-sheller that costs half as much and eliminates more than 80% of margin-eroding expenses. The SITE geospatial mapping program, on the other hand, makes food processing assets available.
With participation from Consonance Investment Managers, Samurai Incubate Africa, who had previously led Releaf’s seed round, led the pre-Series A fundraising. Additionally investing were Stephen Pagliuca, chairman of Bain Capital, and Jeff Ubben, founder of Inclusive Capital Partners and member of the World Wildlife Fund board. Samurai Incubate Africa’s managing partner, Rena Yoneyama, commented on the investment said:
“Releaf’s success with its pilot Kraken validates its thesis, and we are excited to continue supporting their ambitious vision to create efficient supply chains within Africa’s agricultural market.”
