The Capital Quest | AgDevCo and other African poultry business sponsors EthioChicken, Uzima

AgDevCo, an investor specializing in early-stage African agribusinesses structured as a permanent capital vehicle, which has completed its corpus with $90 million in new funding from three investors earlier this year joined other co-investors in backing Flow Equity, a sponsor of distinct poultry ventures in sub-Saharan Africa.

Flow Equity has raised a $14 million funding round with participation from AgDevCo, AHL Venture Partners, Acumen Resilient Agriculture Fund (ARAF) and the Bill & Melinda Gates Foundation. The company mainly operates in Ethiopia through its investment in EthioChicken, and in Rwanda and Uganda through its subsidiary Uzima Chicken.

By reproducing its economic model, the company is preparing to enter new markets in Africa.

According to the World Bank, sub-Saharan Africa has the highest rate (33%) in the world of children under five facing stunting due to food insecurity and lack of protein. Eggs and poultry meat are among the most complete and affordable sources of animal protein for rural households.

Flow Equity was co-founded by David Ellis and Joseph Shields.

The company’s main product is high-yielding day-old chicks (DOC), sold in a package including feed and vaccines to its network of agents who raise the chicks for a month and then sell them to small farmers.

Founded in 2010, EthioChicken has become the industry leader in Ethiopia, selling over 25 million chickens annually. He has also received funding from international impact investors, including the IFC and FinnFund.

Uzima Chicken was launched in 2017 starting in Rwanda and later entered Uganda. Last year Uzima received mezzanine debt financing of AgDevCo.

AgDevCo is owned by a not-for-profit corporation limited by guarantee. Its investments generally vary between 2 and 10 million dollars. It invests across the entire agricultural value chain, from inputs to logistics, and in all sub-Saharan African countries except those with upper middle income.

AgDevCo works across a variety of sectors and crops, including high-value export crops like avocados and macadamias; nutritious food industries for domestic markets and affordable meat proteins like poultry and fish. Its portfolio companies are involved in the entire food sector, from primary production to retail and processing.

Since its inception in 2010, AgDevCo has invested in 80 agribusinesses in sub-Saharan Africa. Its current portfolio includes more than 40 companies (including a number of smaller legacy investments) with a total value of approximately $150 million. These companies are located in nine countries: Ghana, Côte d’Ivoire, Kenya, Tanzania, Uganda, Rwanda, Zambia, Malawi and Mozambique.

Earlier this year, it received a top-up from BII (formerly CDC Group) which committed $50 million in equity. Norway’s Norfund invested $20 million in the form of equity while US International Development Finance Corp contributed $20 million in the form of senior debt.

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