Root Capital signs $35m commitment from DFC
The U.S. International Development Finance Corporation (DFC) announced $35 million in investment support to Root Capital, an impact investor headquartered in Massachusetts that offers farmers around the world a path to prosperity.
DFC’s investment will provide financing to small and growing agricultural businesses in Latin America, sub-Saharan Africa and Southeast Asia. This financing will help break the cycle of rural poverty, reduce food insecurity, and increase environmental sustainability, while responding to the Covid-19 related challenges facing smallholder agriculture. It will also advance women’s economic empowerment, with at least 50 percent of Root Capital’s lending benefiting gender-inclusive businesses.
Small and growing agricultural businesses in low and middle-income countries are chronically underfunded. Research shows that the global financing gap for these rural enterprises is in the hundreds of billions of dollars – at least $65 billion in sub-Saharan Africa alone. By taking steps to close this financing gap, DFC investments can help improve rural livelihoods and transform communities.
“DFC’s investment in Root Capital’s agribusiness impact financing is a fantastic example of our unique mandate to leverage private sector capital to foster incredible development impact and economic growth, in communities that are often overlooked by traditional investors,” said DFC’s vice president for external affairs and head of global gender equity initiatives, Algene Sajery. “The financing provided by Root Capital will help thousands of smallholder farmers across the globe, many of whom are women, to improve their livelihoods, tackle food insecurity in their communities and advance climate resilient agricultural practices.”
”This investment allows Root Capital to reach the most impactful, underserved rural businesses while mitigating risks inherent to the agricultural sector,” said Root Capital’s chief financial officer, Bryan Woliner. “These are businesses that, with the right resources, can improve the livelihoods of more than a million farming families. We are a proud, long-time partner of DFC and immensely grateful for their transformative support.”
In East Africa, DFC’s investment will assist Root Capital with helping farmers in Uganda adopt climate-smart agricultural practices, as well as providing coffee farmers in the Democratic Republic of Congo with the tools they need to overcome financial instability and rebuild after years of civil war.
Root Capital grows rural prosperity by lending capital, delivering business management training, and strengthening market connections for small and growing agricultural businesses, and has become a global leader of gender lens investing in agricultural enterprises.
Are you seeking private equity or venture capital investment to grow your company? Africa Private Equity News now offers you the opportunity to connect with investors backing African businesses. Contact us at editor@africaprivateequitynews.com for our rate card and more information.