The world’s food supply must double by 2050 to meet the demands of a growing population, according to a United Nations report. And as the pressure mounts to find new cultivable land to support growth, the eyes of the world are turning increasingly to the African continent as the next potential global breadbasket.
While Africa has 65% of the world’s remaining uncultivated arable land, according to the African Development Bank, countries on the continent face significant obstacles as they seek to increase the productivity of their agricultural industries.
On the continent, 80% of families depend on agriculture for their livelihood, but only 4% use irrigation. Many families also lack access to reliable and affordable electricity. It is these twin problems that Samir Ibrahim and his co-founder of Sun Culture, Charlie Nichols, have spent the past eight years trying to figure it out.
Armed with a new funding model and specially designed small solar generators and water pumps, Nichols and Ibrahim have already built a network of clients using their equipment to increase their income five to 10 times their previous levels by increasing the value of crops. income, cultivate more land and raise more livestock.
The company also just closed a $ 14 million financing to expand its business across Africa.
“We need to double the amount of food we need to create by 2050, and if you look where there are enough resources to grow food – all the signs point to Africa. You have a lot of farmers and a lot. land, and a lot of resources, ”Ibrahim said.
African small-scale farmers face two big problems when looking to increase their productivity, Ibrahim said. One is market access, which on its own is a huge source of food waste, and the other is food security due to a lack of stable growing conditions exacerbated by climate change.
Like a little farmer told The Economist earlier this year, “The rainy season is not predictable. When it’s supposed to rain it doesn’t, so it all happens at the same time.
Ibrahim, who graduated from New York University in 2011, had long been drawn to the African continent. Her father was born in Tanzania and her mother grew up in Kenya and they finally found their way to the United States. But growing up, Ibrahim heard stories about East Africa.
While pursuing a business degree at NYU, Ibrahim met Nichols, who had worked on large-scale solar projects in the United States, at an event for budding entrepreneurs in New York City.
The two started a friendship and discussed potential business opportunities arising from an article Nichols had read on renewable energy applications in the agricultural industry.
After winning second place in a NYU-sponsored business plan competition, the pair decided to prove they should have won first. They booked tickets to Kenya and tried to start a pilot program for their water pump and solar generator business.
Conceptually, solar water pumping systems have been around for decades. But as the costs of solar equipment and energy storage have fallen, the systems that harness these components have become more accessible to a wider range of the world’s population.
This timing is part of what made it possible Sun Culture succeed where other companies have stumbled. “We moved here at a time when [solar] achieved network parity in many markets. This was at a time when many development financiers were funding the link between agriculture and energy, ”Ibrahim said.
Initially, the company sold its integrated power generation and water pumping systems to middle-income farmers who have jobs in cities like Nairobi and grow crops on land they own in rural areas. These “phone farmers” were willing to spend the $ 5,000 required to install SunCulture’s initial systems.
Today, the cost of a system is between $ 500 and $ 1,000 and is more accessible to 570 million farm households around the world – with the company’s “pay-as-you-grow” model.
It is a turning point in what has become a popular business model for the distribution of solar systems of all types across Africa. According to Ibrahim, investors have invested nearly $ 1 billion in developing solar power and retail technology companies like M-kopa, Greenlight Planet, d.light design, ZOLA Electric and SolarHome. In some ways, SunCulture is simply extending this model to agricultural applications.
“We had to bundle the services and the funding together. The reason this particularly works is that our clients are increasing their income four or five times,” Ibrahim said. “Most of the money has been spent on energy consumption. This is the first time that there has been productive energy.”
SunCulture’s hardware consists of 300 watt solar panels and a 440 watt hour battery system. The batteries can support up to four lights, two phones, and a plug-in submersible water pump.
The company’s best-selling product line can support the irrigation of a two-and-a-half-acre farm, Ibrahim said. “We see ourselves as an entry point for other types of devices. We are becoming the largest solar company in Africa. “
With funding of $ 14 million, from investors, including Energy Access Ventures (EAV), Electricity of France (EDF), Acumen Capital Partners (ACP) and Dream Project Incubators (DPI), SunCulture will expand its presence in Kenya, Ethiopia, Uganda, Zambia, Senegal, Togo and Cote d’Ivoire, the company said.
Ekta Partners acted as financial advisor for the transaction, while CrossBoundary provided additional advisory support, including analysis of market opportunities and competition landscape, under the aegis of the United States Agency for International Development (USAID) Kenya Investment Mechanism Program.