Combining Investment and Technical Assistance
Following food price spikes that left millions of people across Africa undernourished, private equity fund manager Phatisa joined other partners to launch the $250 million African Agriculture Fund in 2011. The fund’s goal was to provide agricultural companies across Africa with the capital they needed to expand their businesses, increase the local availability of food, and benefit farmers and consumers. To amplify the impact of these investments, TechnoServe administered the fund’s $10 million Technical Assistance Facility, providing tailored expertise to help these agribusinesses improve their operations and develop new, inclusive business models.
In Zambia, for instance, an egg producer called Goldenlay received investment through the fund to accelerate its growth. One of the firm’s primary obstacles, however, was acquiring a stable supply of soy to use as poultry feed. The Technical Assistance Facility helped Goldenlay and a local crop aggregator to implement an outgrower model, in which technical assistance, aggregation services, and input finance was provided to smallholders. As a result, farmers improved their yields and are able to access a more profitable market for their crops; the aggregator has expanded its operations; and Goldenlay has the steady supply of soy it needs to increase the production of eggs for the Zambian market.
In the initiative’s seven years, the Technical Assistance Facility worked with 12 agribusinesses to design, strengthen and/or expand inclusive sourcing, distribution, and production strategies, helping over 35,000 people to achieve better livelihoods.