Victory FarmsThe startup for aquaculture and the tilapia fish farm, which includes incubators, ponds with nurseries and deep-sea cages, has raised $ 5 million in new funding.
The investment was managed by Ed Breakman, senior managing director of Bain Capital and Hans den Beeman, founder and former CEO of Mowi, one of the largest salmon companies in the world.
This is the startup’s first institutional investment after seven rounds of domestic angels from the same set of stocks – and debt investors (it has attracted $ 40 million in debt last year). This funding will allow the Kenyan company to expand its business in Rwanda, the DRC and Tanzania.
Joseph Raman founded Victory Farms in 2015. In a conversation with TechCrunch, Raman talked about his path to the company. After completing his MBA program, he began working on a three-month aquaculture project in Ghana, which eventually led to a three-year position where he became CFO of a farm in Accra.
“I learned a lot about the scale of aquaculture and all that. I thought the platform I was using could be much bigger and scale much faster if we could connect more points – and essentially create a final protein plant, ”said Raman, who worked at Investment Bank and Microsoft. .
In 2015, Raman teamed up with his longtime business partner Steve Moran explore Lake Victoria and conduct a feasibility study of how they can use technology to disrupt the country’s cold chain markets.
They concluded that there is a unique opportunity to restore the value chain of fish from scratch. They raised a round of angels to start Victory Farms before launching in mid-2016 to serve a market with a fish shortage of about $ 1.5 billion.
Only the average Kenyan consumes about 10-20% consumption of animal protein, most of which is red meat. With a large shortage of fish and retail prices of up to $ 5 per kilogram, Victory Farm says it uses technology to produce more fish while reducing costs for thousands of women in the market who buy fish in small batches to prepare and sell at local food markets. .
“We are working on a technology platform and have grown 2 times faster than any other African fishing company. And using the data, we’ve built the most efficient operations globally, with half the investment of the current world leader, ”Rehman told TechCrunch by email. “We are selling to the African mass market through the highly innovative Cold Chain RTM, which uses forecast data to push the fish every day to thousands of ladies in the market across Kenya with less than 1% damage.”
The company has more than 54 outlets where more than 15,000 women in the market go to buy fish, and, according to Reman, they use neither electricity nor ice.
“We use vertical integration to get a more robust end-to-end data set,” he said. “It allows us to innovate and create more cost-effective solutions with our systems and data capacity to deliver a better and fresher product to more consumers.”
Victory Farms claims to have one of the highest cost-effective structures in the fishing industry in the world thanks to its technology. The company recorded a CAGR of 130% between 2017 and 2021. Maintaining this growth rate can evoke maximum confidence. In the case of Victory Farms, Raman believes that in Kenya and the larger East African region there are no significant competitors in the company, which also has a processing plant and distribution network.
“We are growing much faster than they (the competitor) that we do not see it as a competitive field. The real competitor for us is hunger, and consumers cannot have an available version of protein, ”he said.
But from a global perspective, Raman advertises Regal Springs from Zurich as a bigger player. However, Victory Farms could surpass Regal Springs in the next five years and become “the largest end-to-end tilapia platform” in the world if its expansion into new geographies goes as planned, the CEO claimed.
Although Victory Farms is focused on profit and growth, Raman said it should be emphasized that the company is working to become the most sustainable tilapia platform in the world. “We are implementing several initiatives and plan to build the world’s first platform for carbon-negative fish. And I think it’s very interesting because we have a lot of tangible and measurable dimensions built into the business to achieve that. ”