Here’s a reality that’s becoming increasingly clear in African business: The continent’s entrepreneurs are often seen as risky investments not due to any limitations of their own businesses, but because of the risks in the systems around them. As a result, if we want more African ventures to thrive, we shouldn’t only focus on de-risking individual businesses. We should put greater effort into strengthening and de-risking the systems that support them.
At Enviu, we approach this challenge from a systems perspective. Lasting change results from addressing gaps across entire supply chains rather than solving isolated issues. We therefore build ventures that target key gaps across the chain. Using a systems-first approach, these ventures tackle challenges ranging from fragmented value chains and limited infrastructure to complex market dynamics.
However, addressing systemic barriers often demands significant coordination, resources and patience. To take one public example, Twiga Foods’ journey in Kenya shows how even well-funded, visionary efforts can encounter structural limits within existing market systems. Long seen as one of Africa’s most promising startups, Twiga has raised more than US $180 million to digitize and streamline the flow of fresh produce from smallholder farmers to city retailers. Their original vision was ambitious: managing farming, warehousing, logistics and distribution in one integrated system. But as the company expanded, this capital-heavy approach proved difficult to sustain.
According to former employees and other insiders, the venture was spending excessively to manage every piece of the chain, and it has required repeated restructuring, layoffs and strategic pivots to stay afloat. Today, Twiga has moved toward a leaner, asset-light model, but its journey illustrates a key point: Even well-funded, innovative ventures struggle when the broader ecosystem does not provide the support, infrastructure and operational flexibility needed to thrive.
Ventures like Twiga are exactly what Africa needs to strengthen its food systems: ambitious, locally driven businesses tackling deeply fragmented value chains. But when the surrounding systems are weak, these ventures are forced to take on too much themselves: building infrastructure, logistics and market access all at once. This makes them acutely vulnerable to capital shocks.
This article examines the systemic challenges African ventures face, and presents a venture-building approach that begins with real-world problems and tackles them across the system, helping entrepreneurs reduce early-stage risk and scale sustainable impact.
It’s the System That’s Risky, Not the Entrepreneur
While high-profile startups like Twiga are impacted by these systemic challenges, let’s zoom out and look at even smaller players: the emerging businesses trying to enter supply chains or serve local markets with far fewer resources. Most entrepreneurs lack access to the capital needed to reach proof of concept or early scale, partly because investors perceive early-stage African ventures as “too risky.” Factors such as currency volatility, political uncertainty, regulatory unpredictability and limited collateral amplify this perception. In addition, many SMEs lack structured financial records, often due to limited capacity, informal practices or resource constraints, which further reinforces the bias that they are “uninvestable.”
AgTech venture funding in Africa peaked at around US $500 million in 2022 but fell to just US $200 million in 2024, according to Briter Intelligence. This waning momentum heightens perceived risk among investors: Less funding then flows into both ventures and the ecosystem that should sustain them, further weakening the system. And so, the cycle of fragility continues.
At the same time, development aid is tightening, with major donors such as USAID, BMZ in Germany, Sida in Sweden and the FCDO in the United Kingdom reducing budgets. This limits access to concessional capital just as private investors are becoming more cautious. The result is a widening systemic funding gap, known as the “missing middle” or “valley of death,” which arises when early-stage ventures are too developed for small grants but not yet ready to attract larger investments, leaving them struggling to transition from promise to scale.
Fixing What’s Broken: A Systemic Approach to Building Ventures
But this cycle of fragility isn’t inevitable. Across Africa, a new generation of builders is rethinking what it means to start a business, focusing not just on single solutions, but on fixing the broken systems behind them. At Enviu, this thinking has taken shape through a systemic venture-building approach that we have refined for over 20 years — one that is designed to de-risk early-stage innovation and build ventures that last.
Enviu has applied this approach to identify urgent systemic issues that are both complex and entrenched, such as post-harvest food loss, eliminating textile and plastic waste, unsustainable shipping and recycling, and financial exclusion. These are problems that markets alone cannot solve because they span entire value chains, involve power imbalances and require coordination among multiple actors to achieve meaningful change.
Additionally, smaller and emerging ventures often face fragmented value chains, limited infrastructure and weak market linkages. No single venture should be expected to shoulder these systemic gaps alone.
Addressing systemic challenges requires a different approach to venture creation. Instead of starting with a product, the focus begins with the issue itself. To enable the deep analysis of an issue, our venture-building teams work closely with frontline actors, such as farmers and waste workers, as well as other value chain stakeholders, including input providers, local authorities and technical experts. Through extensive fieldwork, interviews and data analysis, we map entire value chains to understand lived realities, structural barriers, bottlenecks and opportunities for change.
We then run structured ideation and validation sprints to develop multiple venture concepts. These ventures are iterated and tested in parallel, each designed to address a specific gap in infrastructure, farmer support or market access. Once validated, ventures are built, funded and scaled, working together to strengthen the overall value chain. The process allows for iterative pivoting to find the optimal approach, integrating innovation, building infrastructure, forming critical partnerships and developing highly scalable models.
A core element of this approach is using lean methodologies to reduce capital-heavy operations and encourage collaboration across ventures and partners, making each initiative more resource-efficient and resilient. This includes active engagement with farmer organizations, cooperatives and waste worker associations, and ongoing conversations with local governments at the county level to understand how ventures can best support existing systems. Beyond building our own ventures, our studio actively supports broader system innovation and ecosystem building, enabling solutions to be adopted and scaled by others, including corporates and governments, and collaborating to help shape enabling regulatory environments.
A clear example of our lean approach in practice is SokoFresh, an Enviu venture tackling post-harvest food loss in Kenya. Our initial mapping of the challenge revealed a fragmented value chain, limited infrastructure and weak market access. Based on this, we first developed a model that deployed mobile, solar-powered cold rooms at farm clusters, allowing farmers to store produce for a modest pay-as-you-store fee (around KES 1–2 per kilogram per day) while they searched for buyers. However, through early testing, we found that many farmers preferred immediate payment and did not want to take on the time, risk or negotiation involved in selling their produce themselves. In response, SokoFresh evolved the model to include aggregation and market linkage: pooling produce across farmers, connecting directly to buyers and paying farmers on the spot. This integrated approach combines storage, aggregation and guaranteed market access, reducing post-harvest losses while relieving farmers of the financial and logistical burden of selling on their own.
As the model evolved, we continuously tested, refined and experimented with pricing, customer segments and logistics to find the most effective solutions. The venture expanded to a business-to-business leasing model for exporters and agro-processors, customizing units for specific supply chains. Logistics were adapted to the rhythms of the harvest, with cold room units made semi-mobile and moved between regions to maximize use year-round.
Within the venture-building studio model, core functions such as legal services and finance administration are coordinated and housed at the studio, then shared across ventures alongside strategic advisory and partnership services, reducing costs and operational risk. For investors, this structure de-risks capital by shifting from a single-venture bet to a diversified portfolio that delivers both financial returns and systemic impact.
A key focus is centered on proving evidence before scale. Every venture must demonstrate commercial viability and social or environmental impact on a small scale before additional investment is made. Over time, this creates a replicable, systems-led approach that strengthens the broader ecosystem and delivers measurable impact.
Proof in the Fields: Lessons from East Africa’s Agrifood Ventures
We draw another example from our agrifood work in East Africa, where across our agrifood portfolio every dollar invested has a return of 5.6 times its value. Supported by catalytic funding, we were able to design and test new models that addressed inefficiencies in the value chain and helped smallholder farmers preserve, store and market their produce.
What began as early-stage support evolved into scalable, revenue-generating ventures such as SokoFresh and Shambani Pro, which tackles farmgate waste by turning unsold or second-grade produce into value-added products through rural micro-factories.
These ventures each address food loss at different points in the value chain, while improving food and income security for farmers. Collectively these two ventures have served over 17,000 smallholder farmers, as highlighted in our 2024 Impact Report. This early-stage support de-risked innovation, attracted follow-on investors, and sparked a broader ecosystem of funders and partners committed to building a more inclusive and resilient agrifood system.
While this piece highlights our work in food and agriculture, our venture-building approach spans multiple sectors, from mobility to textiles to circular packaging and zero-waste solutions. If you’d like to partner with us, learn more about Enviu’s work or start a conversation, you can reach Enviu’s Chief Programs Officer, Dieuwertje, at [email protected]
Dieuwertje Nelissen is Executive Director, Eveline Jansen is the Agrifood Domain Director, and Rachael Kirui is a Strategic Communications Consultant at Enviu.
Photo credit: JackF
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