Executive Director of AgroMinds Africa Challenge, Steven Nhyira Odarteifio says the introduction of equity financing for agribusinesses is going to be a game-changer for agribusiness financing on the African continent.
According to him, equity financing for agribusinesses is a more sustainable way of ensuring agripreneurs on the continent have access to funds to expand and see to the development of their businesses as against the typical grants and debt facilities.
He said the AgroMinds challenge was a platform to connect agripreneurs to ready-to-invest investors to secure finances for their businesses.
Speaking on JoyNews’ AM Show, Steven Nhyira Odarteifio said, “AgroMinds is pretty much an empowerment platform that supports agribusinesses across Africa with equity financing to grow and scale the agribusinesses.
“And so we’ve created a platform that brings equity investors into the space, they interact with these finalists or these candidates who are agripreneurs in their own right and they pitch to secure financing for their businesses.
“So we’re pretty much gravitating away from the typical grant or debt facilities that most agribusinesses across the continent are accustomed to.
“We are introducing the concept of equity financing where an investor takes a share in your business and exchange it for a percentage ownership. And so that’s how we are trying to revolutionarise financing for agribusinesses across the continent targeted at youth-driven enterprises.”
Explaining further what the equity financing entails, the Managing Consultant of IESO Agribusiness Consult, Francis Osei said the equity finance was going to ensure the growth of agribusinesses through risk-sharing.
He said, “We know the issues we’ve had with debt. You’d approach a bank and there are difficulties especially when it comes to agriculture. Some of the times you don’t get how much you need, sometimes you don’t get it at all. If you play in the grants space, people who give grants have their own amount and it may not even be up to what you need.
“In other jurisdictions, equity is what sees to the growth of the business because there other people decide to share the risk with you. They jump into the business with you and share the risk and of course the returns.”
He added that equity financing was the sustainable way to go for agribusinesses in Ghana considering the fact that banks and financial lending institutions were now averse to risks especially now in the Covid-19 pandemic.
“But if you look at the usual lenders, they’re becoming systematically risk averse all across Africa and it’s much worse in the Covid situation. And so that is the gap we intend to bridge for the young people in Africa who are engaged in agribusinesses.”
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