Scaling digital agriculture innovations through start-ups (SAIS)

laufendes projekt

SAIS – Silicon Valley for Africa"Scaling Digital Agriculture Innovations through Start-ups" (SAIS) supports selected African start-ups in the agri-food sector to scale their digital agriculture innovations and reach a larger group of users. The project goal is to increase the income of these users through the widespread use of the innovations.Scaling requires capital. This is where SAIS comes in: Tailor-made company development measures implemented by renowned venture builders improve the investment readiness of the start-ups. Their chances of raising capital from investors to reach scale or of entering new markets through new business partners are thereby increased. In doing so, SAIS adapts the processes of existing innovation systems, such as those of the Silicon Valley, and aims to apply them within the African context.The project, with a duration of five years, from January 2019 to December 2023, comprises three action areas. SAIS is implemented by the German Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).Action Area 1: Identification, Evaluation and Selection of Start-upsIn action area 1, suitable start-ups in Africa are identified, evaluated and selected to participate in the SAIS project. The selection of start-ups is based on a range of criteria and a multi-stage selection process. Eligible start-ups are those that have already successfully set up a company in Africa, launched a digital innovation and have acquired their first customers. In addition, they must have a high growth potential in terms of market size and target group and their innovations must generate a positive income effect for their users. Moreover, the start-ups must be in the post-seed or pre-growth stage. Regarding innovations, the following areas are potentially relevant:● E-Commerce for farmers (e.g. product sales, inputs, B2B, B2C, P2P)● Information & consulting services (e.g. know-how, advice, weather data)● Fintech for farmers (e.g. financing, credit services, crowdfunding)● Farm Supply Chain Management (e.g. farm management, transport, storage)● New technologies (IoT, AI etc.)Start-ups are identified using two approaches: through an open application process (Call for Applications) and through a network-based nomination and sourcing process in cooperation with local actors from African innovation systems. A jury of experts decides which start-ups will eventually be selected to join the SAIS project. In order to better integrate the selected start-ups into the local start-up ecosystems before and during the Investment Readiness Programme (see action area 2), SAIS establishes a network with relevant local innovation hubs. This network lays important groundwork for matching investors and building strategic partnerships at later stages in the programme (as outlined in action area 3).Action Area 2: Company Building & Investment Readiness ProgrammeAction area 2 focuses on the company development for the selected start-ups. As part of an Investment Readiness Programme (IRP), the start-ups receive tailor-made company development measures over a period of nine months, which are carried out by renowned venture builders (currently Seedstars, Switzerland, and GreenTec Capital, Germany). SAIS launches a new IRP every year for 10-16 selected African start-ups.In the initial steps, a needs analysis of the individual start-ups is carried out, optimization potential is defined, and individual development plans are drawn up. Based on this, the start-ups are coached, mainly through virtual channels. Depending on the needs identified, different topics are addressed, such as the development of a more precise business model, improvement of marketing and sales strategies, acquisition of new customers and customer groups, improvement of financial management or a critical review of the technology used. An additional focus lies on optimizing the pitch deck, communicating best-practices in investor relations and discussing the basics of company valuation.The IRP is supplemented by three events (either in-person or in a virtual fashion during the Covid-19 pandemic). At the beginning of the program, a kick-off workshop is held, during which a first comprehensive evaluation of the start-ups takes place. During mid-term check-ins, the progress of the start-ups is evaluated and adjustments to the development measures are made. The IRP ends with a demo day, at which successful start-ups with increased investor readiness present their progress and products to potential investors and business partners.Action Area 3: Partner & Investor RelationsIn action area 3, the start-ups supported by SAIS are linked with potential business partners and investors. These are providers of capital, e.g. business angels, venture capital funds, impact investors, as well as business partners and companies (strategists, corporates) or projects and actors from international development cooperation. In order to identify business partners and investors, SAIS engages in holistic network management and cooperates with leading global platforms (for instance the Global Investor Cloud "Advinda").Initial contacts with partners are already established during the Company Development phase (as outlined in action area 2). At the mid-term check-in, the start-ups are then informed about funding and equity options and, if applicable, connected with potential investors and business partners. These contacts are strengthened at the demo day held at the end of the Investment Readiness Programme in order to establish concrete partnerships and business relationships.ImpactSAIS aims to promote at least 30 African start-ups by the end of the project’s five-year duration. The growth of the selected start-ups is monitored regularly. For this purpose, amongst others, the number of customers, as well as access to new markets and qualitative improvements of the business model are monitored and assessed. Moreover, new business and investor partnerships are considered as criteria for successful scaling. By the distribution of the digital innovations, the target group of the SAIS project, actors in the agriculture and food sector, are reached directly. By the time the project comes to an end, SAIS aims to have brought the innovations of the supported start-ups into the hands of 100,000 additional users. The potential of the innovations to increase income in the agriculture and food sector is an important selection criterion and is evaluated through customer surveys.Through promoting innovations, fostering bottom-up private sector development and digitizing the agriculture and food sector, SAIS contributes to achieving the UN Sustainable Development Goals 1 (no poverty), 2 (zero hunger), 8 (decent work and economic growth) and 9 (industry, innovation and infrastructure).

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