Acumen Fund announces investment in Western Seed Company Limited - Acumen

Acumen Fund announces investment in Western Seed Company Limited

By Acumen on April 21, 2010

Acumen Fund is pleased to announce a new investment in our Agriculture Portfolio. Western Seed Company Limited (Western Seed), based out of Kenya, produces improved hybrid maize seeds that increase the productivity of low-income farmers. Acumen Fund will invest US$2.1 million in Western Seed to enhance the food security and economic independence of Kenyan smallholder farmers. African Seed Investment Fund, which invests in businesses to improve the delivery of quality certified seed to smallholder farmers in eastern and southern Africa, contributed another US$1.9 million.

Of the 24 million Kenyans working in agriculture, some 17 million hold plots smaller than 2 hectares in size. Maize is staple crop, serving as a primary source of food and income for smallholder farmers, but their use of inefficient technology often leads to small and irregular crop yields. In 2007, the average maize yield in Kenya was less than half the global average, and a fifth of the average yield for rain-fed maize in the state of Iowa. However, the problem is not that hybrid seed varieties do not exist in Kenya – they do, but adoption by smallholder farmers has been slow because of lack of supply and appropriate distribution strategies on behalf of producers.

Western Seed plans to use the capital from both funds to quadruple its seed output and sales over 5 years, thus boosting the number of households served from 200,000 to over 850,000, and improving the lives of over 4 million people. Western Seed has invested heavily in crop research, and their hybrid maize seeds more than double the yields of farm-saved seeds, while generating a 25% increase over their competitors’ seeds. The investment will support a Direct Access Sales Program to reach farmers in deep rural communities. In fact, 2010 Acumen Fellow Joseph Byarunhanga is currently helping to implement the Direct Sales Access Program, which will prepare locally nominated “farmer-trainers” to serve as sales representatives who can demonstrate the benefits of using Western Seed’s varieties. The Program will allow Western Seed’s productive input to reach farmers who have historically lacked access to high-yielding seed varieties, and challenge local retailers who have increasingly sold adulterated and counterfeit varieties.

This investment in Western Seed is an exciting addition to Acumen Fund’s existing Agriculture Portfolio, which includes small-scale drip irrigation companies Global Easy Water Products and MicroDrip, as well as dairy-farm business Jassar Farms. Collectively, these social enterprises are driving the adoption of technologies that will bring food security and economic independence to small-scale farmers in South Asia and East Africa.

For more information on Acumen Fund’s investment in Western Seed, please refer to the Western Seed investment page and the official press release.

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