Lagos-based Releaf is aspiring to make it easier for FMCG manufacturers in Africa to access high quality ingredients for their factories and has just raised $3.3 million in an oversubscribed Pre-Series A funding round.
Releaf develops technology to enable decentralized purchasing and processing of raw crops to improve profitability and prevent post-harvest loss for the palm oil plant native to West Africa.
The new funding will support the launch of two new technologies. The first is a portable version of its award-winning palm nut de-sheller called (Kraken II). Second is a geospatial mapping application called SITE. This identifies the most optimal positioning of supply chain infrastructure for consumer goods manufacturers, creating an effective link with Africa’s decentralized farming system.
CTO and co-founder of Releaf Uzoma Ayogu said the technologies are the next steps in the company’s plan to fundamentally transform the efficiency of agricultural supply chains in Africa. “To make food supply chains profitable, we must maximize extraction yields with leading processing technology and minimize logistics costs by bringing processing capacity closer to farmers,” he said. Before Releaf, he explained, stakeholders had to choose between one or the other – large factories had great technology but were far away, leaving most farmers with rudimentary technology to process their crops. “We’re now able to maximize both,” he declared.
The SITE technology used cutting-edge geospatial mapping tools to determine how much oil palm is planted in an area and their annual yields. Alongside Releaf’s proprietary data on soil type, rainfall, farmer productivity and 3rd-party data from organizations like the International Institute of Tropical Agriculture (IITA), Foundation for Partnership Initiatives in the Niger Delta (PIND) and Rocky Mountain Institute (RMI), the company said it can deliver a dynamic view of farming activity.
Kraken II is a portable, lower-cost version of Releaf’s Kraken which the company claims is West Africa’s most advanced palm nut de-sheller. It is just as efficient as its static predecessor, it claimed, costs half as much and can attain 3x profitability because it can be transported to high density farming areas, eliminating more than 80 percent of margin-eroding logistics costs.
According to company, the combination of Kraken II’s portability and SITE’s placement and route planning capabilities enables Releaf to target the best opportunities across Nigeria’s oil palm belt rather than being limited to sourcing crops within 100 kilometres of a fixed processing site like existing food processors.
Africa will represent 40% of the human population by the end of the 21st century and the fast-moving consumer goods market will emerge as its first globally relevant industrial sector. Releaf’s technology is therefore designed to accelerate this industrialization while ensuring inclusive success for the planet, farmers, food factories, and consumers in one of the greatest economic opportunities globally.
Since launching in 2021, Releaf said it has used its supply chain technology to process more than 10 million kilograms of palm nuts and grown its monthly revenue 7X year on year.
“We want to replicate this success across Nigeria and the rest of Africa, and these new technologies are the next steps in our plan to fundamentally transform the efficiency of agricultural supply chains in Africa,” said Uzoma Bailey Ayogu.
The company has also secured more than $100 million in supply contracts from leading consumer goods manufacturers, including Presco, PZ Cussons. Releaf’s valuation has tripled since its seed round a year ago.
The latest funding round was led by Samurai Incubate Africa, Samurai Incubate Africa is a venture capital firm based in Tokyo, Japan, investing in start-ups in Africa. High profile US venture capitalists Stephen Pagliuca (Chairman of Bain Capital) and Jeff Ubben (Board member at World Wildlife Fund and Founder of Inclusive Capital Partners) also invested.
SITE, meanwhile, was developed in collaboration with Stanford University’s sustainability export Professor David Lobell, who said: “I enjoyed working with Releaf and using our tree height algorithm to establish the correlation between oil palm age and height to help farmers to get a better understanding of their future yields and make better data-driven decisions on sustainable replanting. There is a great opportunity to unlock Africa’s unique agricultural potential by leveraging remote sensing solutions, and I believe this partnership will be a catalyst.”