Nigeria’s agritech sector experienced a robust recovery in 2021 post-COVID-19, with significant funding rounds for startups like Releaf, Agricorp, Vendease, and ThriveAgric, though challenges such as immature financial ecosystems and insecurity continue to hinder long-term success.
Agritech’s Role in Nigeria’s Economy
Agriculture remains a cornerstone of economic growth in Nigeria, driven by a growing population and rising demand for food. Agritech, which leverages technology to enhance production efficiency, is gaining traction as entrepreneurs secure funding to innovate in areas like software solutions, farmer-market connections, and supply chain automation.
Major Agritech Funding Rounds in 2021
Several Nigerian agritech startups attracted significant investments in 2021, signaling strong investor confidence in the sector:
Releaf: $4.2 Million for Efficiency Solutions
Releaf, founded by Ikenna Nzewi and Uzoma Ayogu, raised $2.7 million in a seed funding round led by Samurai Incubate Africa, Future Africa, and Consonance Investment Managers, with participation from Stephen Pagliuca (Bain Capital) and Justin Kan (Twitch). Additionally, Releaf secured $1.5 million in grants from The Challenge Fund for Youth Employment (CFYE) and USAID, totaling $4.2 million to develop hardware and software solutions for farmers and food factories.
Agricorp: $17.5 Million for Spices Production
Agricorp, a spices manufacturer and exporter founded by Kenneth Obiajulu and Wale Omotimirin, raised $17.5 million in a Series A round led by Vami Nigeria, with participation from One Capital LLC, AFEX, and other investors. The funds aim to boost production capacity to 7,000 metric tonnes, enhancing Nigeria’s agricultural export market.
Vendease: $3.2 Million for Food Supply Chain
Vendease, founded by Tunde Kara, Olumide Fayankin, Gatumi Aliyu, and Wale Oyepeju, secured $3.2 million in seed funding led by Global Founders Capital, with Y Combinator, Hustle Fund, Liquid 2 Ventures, and Soma Cap participating. The platform automates food procurement, storage, logistics, and payment systems, transforming Africa’s food supply chain.
ThriveAgric: $1.75 Million for Smallholder Farmers
ThriveAgric, founded by Uka Eje and Ayodeji Arikawe, received a $1.75 million grant from the USAID-funded West Africa Trade and Investment Hub to support 50,000 smallholder farmers growing rice, maize, and soybeans, enhancing food security through finance, market access, and data-driven advisory services.
Challenges in the Agritech Sector
Despite these successes, Nigeria’s agritech industry faced significant hurdles in 2021:
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Immature Financial Ecosystem: GSMA research highlighted that Nigeria’s financial infrastructure struggles to support multi-year risk-taking and unproven business models, forcing startups to prioritize revenue over research and development, often leading to early failures.
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Crowdfunding Failures: Several agritech firms, particularly those using crowdfunding, collapsed in 2021 due to cash flow issues after failing to deliver promised returns to investors.
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Limited Financial Access: The absence of a robust regulatory environment for digital financial services restricted smallholder farmers’ and value chain players’ ability to access funding for business growth.
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Insecurity on Farmlands: Banditry, kidnapping, and general insecurity forced many farmers to abandon their lands, exacerbating hunger and threatening social stability.
Expert Insights
Kenneth Obiajulu, founder of Agricorp, attributed agritech growth to entrepreneurs capitalizing on opportunities for commercially viable solutions. He noted, “The level of investment in agriculture encourages entrepreneurs to create innovative systems.” Obiajulu believes Nigeria’s agritech sector is in its infancy but poised for a boom over the next 10–20 years as technology aligns with agriculture.
Ikenna Nzewi, CEO of Releaf, emphasized the sector’s potential, stating, “With Nigerians spending 60% of their income on food and Africa’s population growing by 100,000 daily, agritech offers opportunities to feed more people, reduce costs, and supply the world’s fastest-growing food market.”
Future Outlook
Nigeria’s agritech sector is at a pivotal moment, with 2021 funding rounds signaling its potential to transform agriculture. However, addressing financial infrastructure gaps, regulatory challenges, and insecurity will be crucial to sustaining growth and ensuring long-term success for startups and farmers alike.
