Venture: myAgro

Mission: To help one million smallholder farmers increase their yields and incomes by 2025.

Investment: $1.5 million working capitol loan

Investment Year: 2019

How a working capital loan helps myAgro lower costs and serve more farmers

myAgro enables smallholder farmers in Sub-Saharan Africa to put aside small amounts of cash during the dry season to pay for seeds, fertilizer, and training with the goal of doubling harvests and incomes. For myAgro farmers, using their mobile phones to save little-by-little helps avoid debt, invest in the future, and realize financial independence without relying on inaccessible traditional banks.

Why We’re Invested:

Ventures that work in the agricultural sector have inherently fluctuating cash flows that mimic the inflows and outflows of the farmers they serve. Farmers have large expenses ahead of planting season to secure seeds, fertilizer, and farming equipment in bulk, which leaves them limited with cash until revenue comes in after the following harvest; the same is true of myAgro. Helping farmers afford inputs by creating economies of scale is critical for supporting smallholders as they grow their yearly incomes. But this same mechanism creates a bottleneck for scaling agricultural ventures, which are forced to pay the bulk cost of inputs out of the same pocket they use to support their existing operations and expansion costs—expenses like payroll, training, and research & development.

Working capital loans are perfectly suited for use cases like myAgro, effectively bridging inconsistent cash flows with a well-tailored loan. The challenge for myAgro and others is that seven-figure loans are limited for social ventures, and are deemed too high risk for traditional financial institutions.

Ongoing Impact:

A $1.5 million working capital loan, which renews annually, helps myAgro purchase high-quality inputs for more than 90,000 smallholder farmers each year in time to deliver ahead of their planting season. This three-year loan saves myAgro 30 percent in interest annually, which they would otherwise pay without a line of credit.

With a reliable, recurring source of working capital, myAgro is able to scale its operations to reach more farmers without their delayed farmer revenue becoming a bottleneck. The organization is on target to serve 1 million farmers by 2025, having reached 90,000 farmers in 2020. Rippleworks also supported myAgro with catalytic grant funding as the organization diversifies its revenue stream to include more multi-year grants and government funds.

myAgro’s mission is to double the incomes of one million smallholder farmers by 2025

More About myAgro:

myAgro’s mission is to double the incomes of one million smallholder farmers by 2025.

myAgro accomplishes this with a unique mobile layaway model, which allows farmers to use their phones to purchase inputs (like seeds and fertilizer) in small increments. After 6-8 months of saving little-by-little, myAgro delivers the high-quality inputs directly to farmers right in time for planting season. myAgro provides in-person and mobile-based agricultural training to all farmers who invest in input packages, sharing harvest-improving techniques tailored to specific regions and crops.

But farmers don’t only struggle with the availability and affordability of inputs at the start of the season; access to credit has not scaled fast enough to reach 90 percent of the smallholders served by myAgro, and access to formal savings across Africa has seen even lower penetration rates.

myAgro believes that farmers are able and eager to save, and is proving to governments and financial institutions the power of investing in them, their farms, and their families.

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