Why we Invested: AquaRech is unlocking the potential of smallholder fish farmers in Kenya
Consumption of fish in Africa to meet the growing protein demand is increasing rapidly, even as wild fish populations are shrinking due to pollution, overfishing, and lack of protective regulation and enforcement. Given collapsing wild stocks, the market has begun transitioning to aquaculture to supply fish. Although they face a growing market, smallholder fish farmers are unable to capitalize on the opportunity because they struggle to acquire quality feed, lack knowledge for how to grow farms sustainably, and often face barriers to accessing markets.
AquaRech is a platform for fish farmers to source quality feed, transition to tech-enabled precision fish farming, find new routes to market, and access credit to fuel farm growth.
AquaRech has developed a unique model to unlock the potential of smallholder fish farmers in Kenya and, eventually, the entire African continent. It has become a premier platform for the segment by helping growing mid-scale fish farmers purchase high-quality inputs, as well as access fish traders for offtaking.
In terms of inputs, the startup offers fish farmers the opportunity to source high-quality floating fish feed (in contrast to low-quality and/or sinking fish feed pellets) through its app, thus creating a unique aquafeed marketplace. The startup is also offering fish farmers who sell through the platform easier access to fish feed through BNPL (Buy Now Pay Later) financing.
The mobile app, assisted by remote sensors, allows farmers to monitor temperature and other vital variables on the farm, learn about best fish farming practices, and incorporate data-driven management practices. This, coupled with the higher quality fish feed sourced through the platform, makes it possible for farmers to shorten growth cycles (by over 30%) and decrease harvest mortality, thus improving farmers’ productivity and resilience.
Furthermore, the startup provides bulking centers and cold chain facilities to aggregate fish supply from the fish farmers and build deals with fish traders directly.
Overall, fish farming will play an essential role in reducing food and nutrition insecurity in Africa, as well as promote socioeconomic growth, and improve the livelihoods of marginalized communities. The fish sector currently supports the livelihoods of 12.3 million people in the continent, notably empowering females in the process since 58 percent of the actors involved in post-harvest activities are women.
To date, Aquarech has onboarded more than 360 fish farmers in Kenya and contributed directly to the sustainable production of over 1000 metric tonnes of cultured fish over the past 12 months. By reducing the growth cycle from a 13-16 month production cycle to an 8-10 month one, Aquarech has enabled an increase in the harvest cycle per year of around 66 percent, further increasing productivity.
Benefits also extends to the environment. By sharing technical information and market intelligence with farmers and promoting the use of water quality monitoring devices, Aquarech helps farmers use natural resources more carefully. Greater productivity and use of technology also helps the whole value chain decrease food spoilage.
Africa has about 400,000 small and medium fish farmers, with Kenya representing more than 49,000. However these numbers are growing. Aquaculture accounts for approximately 20 percent of the total fish production in Africa, but fish production is increasing every year by the millions of tonnes as climate change threatens wild stocks. It represents a growing industry that will, in the future, be key to the continent’s food security. Aquarech plans to work side by side with these smallholder farmers, as well as with feed manufacturers and fish buyers, to transform food production in the continent and ensure nutritional security.
The Catalyst Fund model delivers outsized success compared with other accelerator programs. We accelerate startups that excel on three fronts:
- Impact: Catalyst Fund startups deliver (or, in the case of B2B firms, facilitate the delivery) of life-changing products and services to underserved populations. These can include financial services like loans, savings, insurance, and investment, but also access to productive inputs or essential services such as energy, sanitation, and water.
- Innovation: Our startups are pioneering game-changers that are innovating new products and business models. They drive the sector forward by demonstration effect and via the learning that Catalyst Fund documents and shares.
- Growth potential: Catalyst Fund startups are distinctively investment-worthy, developing businesses that are scalable, with high growth potential. Our startups are selected by an Investor Advisory Committee, who have deep experience in emerging markets and nominate high-potential startups, and then sponsor and mentor them through Catalyst Fund. As a result, our startups raise more funding than startups from other accelerators.