(Ecofin Agency) - Acumen Resilient Agriculture Fund (ARAF), managed by Acumen Capital Partners, announced its final closing last month at $58 million. The impact fund is the world’s first equity fund designed to build an ecosystem of agribusinesses that improves farmers’ livelihoods and builds their resilience to climate change.

Acumen has raised a total of $83.8 million across four funds, their latest being Acumen Resilient Agriculture Fund (ARAF) which is sponsored by Acumen, anchored by the Green Climate Fund, and supported by FMO, the Soros Economic Development Fund, PROPARCO, the Children’s Investment Fund Foundation, Global Social Impact, IKEA Foundation, and other passionate investors and funders.

“Smallholder farmers feed the world, but they are among the most affected by the climate crisis,” said ARAF’s Managing Director Tamer El-Raghy. “ARAF’s impressive $58 million close, $8 million above our initial target for the fund, is a watershed moment and, with only 5% of climate investment directed toward adaptation, signals the beginning of a shift in climate finance. By investing in agri-startups in East and West Africa, ARAF can reduce poverty, build climate resilience, and demonstrate the impact of investing in resilient agriculture. Since we started deploying capital in 2020, our team has invested in five companies operating in Kenya, Uganda, and Nigeria.”

According to a report from IFAD, Africa is estimated to have about 33 million smallholder farmers who contribute up to 70% of the food supply. Also, Sub-Saharan Africa alone has a quarter of the world’s arable land which produces 10% of its agricultural output. Yet, it remains a net importer of food.

The continent spending billions importing food rather than creating alternatives to grow more food locally can be attributed to challenges including lack of political will, supportive agricultural policies, and investment. Recent and pertinent challenges include the impact of the Covid- 19, coupled with climate change, threatening the lives and livelihoods of smallholder farmers with devastating impacts.

It is in this vein that ARAF aims to provide equity and mezzanine products, and technical support to early-stage and early-growth agribusinesses. In turn, these businesses will provide climate resilience solutions to smallholder farmers in East and West Africa.

Solange Che