Using Crowdfunding to Address Funding Inequalities in Kenya’s Agribusiness sector
By Purity Akoth
Agriculture is the engine of economic growth in Kenya with about 77% of Kenyans earning all or part of their income from this sector. However despite being a major contributor to the country’s economic growth, youth agripreneurs face challenges in capital financial inefficiencies and access thus making agricultural productivity stagnant over the years.
With bank loans becoming harder to come by and food production slowing down due to lack of capital investment, many farmers are looking for alternatives. LakeHub in partnership with the Opportunities for Youth in Africa (OYA) programme, a joint initiative of United Nations Industrial Development Organisation (UNIDO)and Food and Agriculture Organisation (FAO), is giving youth agripreneurs from Kenya an opportunity to enhance their access to capital finance for agribusinesses through crowdfunding training.This programme proposes to bridge the investment gap in agribusiness of young entrepreneurs who require to raise capital to enable them offer new agriculture solutions, create production efficiencies and significantly build firm value.
Beyond providing the farmers with access to capital, this month long training programme also focuses on improving agriculture value chains by providing technical support in product diversification and farming techniques modernisation so as to ensure higher efficiency for yields and better produce. This programme will therefore provide small rural farmers with enhanced opportunities to launch their agribusiness and stabilise cash-flow by reducing pressure on financing and sale.
Looking Ahead
After a 60 percent success rate and a total of Kshs 2,756,391 raised in the first phase of crowdfunding conducted by LakeHub, in partnership with 2SCALE last year, we’ve seen growing interest among agricultural SMEs to leverage this approach to raise funds for their businesses. This crowdfunding training programme therefore has been designed in three modules where 50 agripreneurs between ages 18–35 across Kenya, will get familiar with best practices and strategies to adopt so as to successfully launch their crowdfunding campaign on the best platforms.
By leveraging technology, this crowdfunding training will serve as an enabling mechanism for new venture formation, job creation, sustainability and inclusive economic growth.
