Wamda Capital, a MENA-focused venture capital investor, is making its first investment in East Africa and leading a $10.3 million debt/equity Series A round in Twiga Foods, a mobile-driven supply platform for retail outlets, kiosks and market stalls in Kenya.
As part of the deal, Wamda’s Chairman, Fadi Ghandour will take a seat on Twiga’s Board. Other members of the investment consortium included existing shareholder, DOB Equity, who reportedly took a minority stake in the company a year ago, as well as Omidyar Network, Uqalo, 1776, Blue Haven Initiative, AlphaMundi and AHL Ventures. Of the $10.3 million investment, $6.3 million is structured as equity, with the balance being debt. No further financial details were disclosed.
“We are particularly excited in beginning our investment program in East Africa by supporting this remarkable set of entrepreneurs building a truly disruptive business,” Wamda’s Fadi Ghandour was quoted as saying in the statement announcing the investment, indicating that East Africa was “…a new geography for us, in which we plan on being increasingly more active.”
The fresh capital will be used to expand the number of vendors Twiga supplies, as well as support its efforts to diversify its product portfolio and provide more advanced services to its suppliers. The company’s operational model has vendors buying fruit and vegetables from Twiga using their mobile phones, who then delivers the ordered produce directly to the retailers’ stalls. By leapfrogging traditional supply chains, the company reduces costs and minimizes waste by optimizing just-in-time delivery. Starting in 2013, Twiga began by supplying bananas and has since broadened its offering to include tomatoes and onions. Today, Twiga is the largest distributor of several basic food staples in Kenya, having sold over 55 million bananas since it started operations and now fulfills over 4,000 orders a week.