Swiss-Ghanaian start-up Koa secured a substantial equity investment of US$15 million in its recent Series B funding round. The Land Degradation Neutrality (LDN) Fund from Mirova, along with the Regenerative Growth Fund 1 managed by Zebra Impact and Mirabaud, led the round with a notable US$9 million investment. The remaining funds were contributed by various new investors, complemented by continued support from existing shareholders, including Haltra, who led Koa’s Series A equity round in 2021.
The injection of funds is earmarked for scaling up Koa’s innovative cocoa upcycling strategy. This strategy involves leveraging a newly inaugurated cocoa fruit factory in Ghana to increase production tenfold, extending cocoa fruit upcycling, and promoting regenerative and climate-smart agricultural practices. Koa aims to share its upcycling technologies with an additional 10,000 cocoa smallholders, addressing the challenges of food waste and fostering sustainability within the cocoa industry.
Why The Investors Invested
The primary drivers behind the investors’ decision to commit significant funds to Koa are rooted in the transformative impact of the startup’s operations and its alignment with sustainable finance goals:
Mirova’s LDN Fund sees Koa as a catalyst for sustainable and fair economic development in emerging countries. The LDN Fund aims to address substantial investment needs in such regions, and Koa’s initiatives, reducing food waste and providing additional income to local producers, resonate with this ambition.
The Regenerative Growth Fund 1, managed by Zebra Impact and Mirabaud, focuses on investing in nature tech solutions. Recognizing the challenges posed by nature loss and climate change, the fund sees Koa as a strategic player in transforming the cocoa value chain, aligning with their broader goal of supporting innovative solutions to global environmental challenges.
A Look at Koa
Founded in 2017, Koa has emerged as a trailblazer in the cocoa industry, particularly in West Africa. The startup, with its Swiss-Ghanaian roots, has unlocked a new value chain by innovatively upcycling cocoa fruit, notably the previously discarded cocoa pulp. Collaborating with cocoa smallholders in Ghana, Koa simultaneously reduces on-farm food waste, generates additional income for farmers, and introduces unique ingredients to the food and beverage industry.
Factory Inauguration and Strategic Expansion: The recent inauguration of Koa’s new cocoa fruit factory in Ghana signifies a pivotal moment for the company. This facility serves as the cornerstone for scaling up production, cooperating with an additional 10,000 cocoa farmers, and intensifying regenerative agriculture practices. The Series B funding is crucial for Koa to facilitate these expansions, develop more cocoa fruit products, and broaden its marketing and distribution efforts.
Koa’s strategic expansion revolves around promoting sustainability in the cocoa value chain. By focusing on regenerative agriculture, the startup aims to enhance the resilience of cocoa farms, simultaneously addressing issues of soil fertility deterioration and the high carbon footprint associated with traditional cocoa farming in West Africa.
Koa’s endeavors align with broader industry trends, where sustainability in chocolate and cocoa ingredients is becoming increasingly prominent. The upcycling trend, rescuing ingredients that would otherwise go to waste, is a key aspect of Koa’s approach. Beyond cocoa, the company’s initiatives contribute to reducing waste in food value chains, addressing the global imperative for sustainable resource use in the production of food and beverage products.
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard.