Nairobi, Kenya, June 5, 2012 – Acumen Fund, a pioneering nonprofit global venture firm addressing poverty across Africa and in South Asia, today announced a $1.5 million convertible debt investment in Virtual City, a mobile technology services provider based in Nairobi.
Virtual City is the maker of Agrimanagr, an affordable mobile data management service marketed to agricultural cooperatives and processors that tracks agricultural output from farmer to processor, coordinates mobile payment to farmers, and facilitates extension services such as veterinary visits and agricultural input management. This investment will support the redevelopment of this product to make it more affordable for smaller agricultural processors and available via low-cost smart phones.
“This redesign represents a game-changing innovation that will connect farmers to markets, allowing them to increase their income, build records of farm production and payment and receive the appropriate reward for increased attributed yields,” said Maurice Nduranu, East Africa Portfolio Manager, Acumen Fund. “This investment represents another way in which we’re expanding our investment experience across the agricultural sector to learn about what is needed to professionalize small holder farming.”
Smallholder farmers, typically widely dispersed and isolated because of poor transport infrastructure, face challenges in accessing markets, organizing into cooperatives, and bypassing local or farm-gate brokers. By participating in the networks of agricultural processors and aggregators, smallholder farmers typically increase their earnings by 40-100% through improved access to credit, guaranteed markets, better information as well as other services.
Farmers utilizing the Virtual City solution increase these earnings by an additional 10%, yielding a minimum 50% increase in earnings compared to non-participating farmers. Agrimanagr has been shown to increase farmer incomes by over $100 per year.
“Acumen Fund’s investment will help us scale Virtual City’s activities from 300,000 farmers served to-date to more than 3 million farmers over the next 5 years,” said John Waibochi, CEO, Virtual City. “We are using this technology to improve the livelihoods of rural smallholder farmers and to change the ecosystem for the agricultural processing sector and support local economies.”
For additional information on Acumen Fund East Africa and its investment in Virtual City or in the Agriculture sector, please visit www.acumenfund.org or contact Suraj Sudhakar at firstname.lastname@example.org or Elizabeth Patella at email@example.com.
About Acumen Fund
Acumen Fund is working to create a world beyond poverty by investing in social enterprises, emerging leaders and breakthrough ideas. We invest patient capital in business models that deliver critical goods and services to the world’s poor, improving the lives of millions. Since 2001, Acumen Fund has globally invested more than $75 million in 69 companies. We are also working to build a global community of emerging leaders that believe in creating a more inclusive world through the tools of both business and philanthropy. Please visit www.acumenfund.org for more information.
About Virtual City
Virtual City is a mobile technology services provider based in Nairobi. It was founded in 1999 by Kenyan entrepreneur and current CEO John Waibochi. Apart from Agrimanagr, Virtual City’s other major product is Distributr, a sales and inventory management service targeting distributors, primarily in the agricultural sector. In recent years, Virtual City has received various awards including the Legatum Pioneers of Prosperity, Africa Enterprise Challenge Fund, the Nokia Growth Economy Venture Challenge, and the World Bank funded Kenya ICT Board Tandaa Grant.