This Kenyan insurtech startup is eyeing Asia and Latin America after raising $6m funding

Abu Mubarik Feb 21, 2021 at 01:00pm

February 21, 2021 at 01:00 pm | Success Story, Tech & Innovation

The agric sector remains unattractive to a large majority of educated African youths, despite the sector being the second-largest employer. Photo: Wikimedia Commons/ Haytam123258

Access to capital and insurance are some of the factors affecting not only peasant farmers but commercial farmers in Africa. A large majority of farmers in Africa still use hoe and cutlass and farm largely to feed their households and sell the surplus for cash.

This makes private capital injection into the sector unattractive. Aside from that, the sector remains unattractive to a large majority of educated African youths, despite the sector being the second-largest employer, after the services sector, in Africa.

In Ghana, the government launched an agriculture program called Planting for Food and Jobs to increase youth participation in agriculture through the provision of subsidized fertilizers and other incentives but the flow of rural folks to urban areas for jobs suggests the program is not achieving its intended purpose.

For rural farmers, part of the reasons for migrating to urban centers is to work menial jobs so as to accumulate some capital to serve as insurance for crop failure which could be occasioned by flood, poor weather conditions, among others.

The risks African farmers face have widely been documented but steps taken by African governments to assist them remain lackadaisical. An insurtech startup called Pula is providing small-scale farmers with assistance to help them mitigate hard farming conditions.

The company specializes in digital and agricultural insurance to derisk millions of smallholder farmers across Africa. It recently closed a Series A investment of $6 million led by Pan-African early-stage venture capital firm, TLcom Capital, with participation from nonprofit Women’s World Banking.

According to Techcrunch, the raise comes after Pula closed $1 million in seed investment from Rocher Participations with support from Accion Venture Lab, Omidyar Network and several angel investors in 2018.

The new financing will scale up operations in its existing 13 markets across Africa, where it has insured over 4.3 million farmers. They include Senegal, Ghana, Mali, Nigeria, Ethiopia, Madagascar, Tanzania, Kenya, Rwanda, Uganda, Zambia, Malawi and Mozambique, Techcrunch reported.

Founded in 2015 by Rose Goslinga and Thomas Njeru, the Kenyan agricultural insurance company is now looking at expanding to Asia and Latin America. The startup has an average subscription of $4 for farmers in Africa.

“We are able to work in 13 countries not because we have insurance licenses in all these countries but because in every one of those countries there are insurance companies that are willing if enabled by a company like ours,” co-founder Goslinga told Quartz Africa.

Pula’s expansion to Asia and Latin America will focus on countries such as Philippines, Thailand, Turkey, and Pakistan. “What we’ve realized is that African solutions are in no way inferior to Asian, European solutions,” said Goslinga.

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