ARAF seeks to build an ecosystem of agribusinesses that improve farmers’ livelihoods and build their resilience to climate change
The Acumen Resilient Agriculture Fund (ARAF), a first-of-its-kind equity fund that provides critical capital to support African agribusinesses that help smallholder farmers adapt to climate change, recently closed at $58 million. Sponsored by Acumen and anchored by Green Climate Fund (GCF), the fund is supported by the Dutch Entrepreneurial Development Bank (FMO), the Soros Economic Development Fund, the French development institution PROPARCO (through FISEA+, the AFD Fund advised by PROPARCO), the Children’s Investment Fund Foundation, IKEA Foundation, Global Social Impact, and other respected investors and funders. The fund is managed by Acumen Capital Partners, a wholly-owned subsidiary of Acumen.
“Smallholder farmers feed the world, but they are among the most affected by the climate crisis,” said Tamer El-Raghy, MD, ARAF. “ARAF’s impressive $58 million close, $8 million above our initial target for the fund, is a watershed moment and, with only 5 per cent of climate investment directed toward adaptation, signals the beginning of a shift in climate finance. By investing in agri-startups in East and West Africa, ARAF can reduce poverty, build climate resilience, and demonstrate the impact of investing in resilient agriculture. Since we started deploying capital in 2020, our team has invested in five companies operating in Kenya, Uganda, and Nigeria.”
By supporting agribusinesses that offer aggregation, digital platforms, and financial solutions to smallholder farmers, ARAF seeks to build an ecosystem that enables farmers to raise their incomes and increase their resilience.
“The fund will make critical investments to support climate resilience and agriculture productivity for smallholder farmers across countries in East and West Africa and help shift the pattern of investment in climate change adaptation in Africa from grants to a long-term capital approach,” said Tony Clamp, Director, GCF’s Private Sector Facility.
ARAF answers this call by using blended finance to provide long-term support to small and medium-sized agribusinesses and through its $5 million Technical Assistance Facility (TAF) that is designed to provide farmers with the hands-on support they need. The TAF is funded by grants from GCF, IKEA Foundation, FCDO, and FMO.
