AgDevCo Ventures secures US$49M to finance early-stage agri-SMEs in East Africa

EAST AFRICA – AgDevCo Ventures has secured US$49 million in initial funding to provide long-term capital to early-stage agricultural businesses in East Africa, targeting companies that have outgrown microfinance but remain too small or risky for conventional commercial lenders.

The new investment vehicle, a subsidiary of AgDevCo, will provide investments of US$1 million to US$3 million to farming, agricultural input, and agriprocessing businesses. 

It is designed to address what AgDevCo describes as a financing gap for the region’s “missing middle” of agribusinesses.

The first close includes $10 million in subordinated debt from the International Fund for Agricultural Development (IFAD) and $11.25 million from a consortium of senior lenders comprising the Small Foundation, A to Z Impact, Rabo Foundation and Netri Fundación Privada.

The external funding is complemented by a $28 million equity injection from AgDevCo, using funds from the UK’s Foreign, Commonwealth & Development Office (FCDO).

IFAD Associate Vice-President Donal Brown said the investment is expected to support rural transformation while helping attract additional private capital into agricultural businesses.

“IFAD is pleased to provide an investment of USD 10 million to AgDevCo Ventures Limited,” Brown said. 

“IFAD’s catalytic role to crowd in private investors into AV structure demonstrates our commitment to work together with the private sector towards rural development.”

AgDevCo Ventures is now fully operational under the leadership of Christine Mwangi, an investment professional based in Nairobi. 

The organisation expects to announce its first investments later in 2026.

Closing East Africa’s agricultural finance gap

AgDevCo Ventures is targeting businesses across the agricultural value chain, with an initial focus on East Africa. 

AgDevCo has previously identified Kenya, Ethiopia, Rwanda, Tanzania and Uganda as its initial markets for the strategy.

The initiative provides patient mezzanine debt rather than short-term financing. 

According to AgDevCo, businesses receiving the capital will also have access to technical assistance aimed at strengthening management, operations, environmental and social performance, and agronomic practices.

This complements AgDevCo’s main Growth strategy, which targets more established agribusinesses with investment requirements of approximately US$3 million to US$12 million.

Stefan Freeman, Head of Investments at Ceniarth, speaking on behalf of the senior lender consortium, said the vehicle addresses a financing gap affecting high-potential agricultural SMEs.

“AgDevCo Ventures fills a critical financing gap for high-potential but underserved agri-SMEs,” he said, describing its combination of early-stage investment, flexible financing and technical assistance as a response to an underfinanced segment of African agriculture.

Over the next decade, AgDevCo Ventures is expected to reach more than 128,000 smallholder farmers and contribute to the creation of approximately 2,900 full-time jobs.

The funding comes as AgDevCo expands its broader investment activity across African agriculture. 

Its 2025 portfolio included US$368 million in funds under management across 38 companies in 12 sub-Saharan African countries, while portfolio companies engaged more than 2.6 million small-scale farmers, traders and customers.

The launch of AgDevCo Ventures therefore creates another financing pathway for smaller agricultural businesses seeking to scale before they become eligible for larger commercial investments.

Sign up HERE to receive our email newsletters with the latest news updates and insights from Africa and the World, and follow us on our WhatsApp channel for updates.