ImpactAlpha, February 18 – A fund launched by the International Fund for Agricultural Development (IFAD) has raised €50 million ($56.5 million) to invest in businesses supporting small-scale farming in global emerging markets. The Agri-Business Capital Fund kicked off in December with a goal of raising €200 million.
Access to capital is a “perennial challenge for viable businesses seeking financing in developing countries,” says the fund’s managers, Bamboo Capital Partners and Injaro Investments. To encourage private investors into the sector, the European Union, the African, Caribbean and Pacific Group of States, the Luxembourg Government, and the Alliance for a Green Revolution in Africa have invested €50 million, which will serve as first-loss capital to de-risk the fund.
The fund will make mostly debt investments—up to €5 million for intermediaries and farmer-financing organizations and €1 million in direct deals. IFAD is providing technical assistance funding, which is also intended to de-risks the fund’s investments.