Founded in 2017, Koa is disrupting the cocoa industry through its innovative upcycling of the cocoa fruit. Koa is the first company in West Africa to have unlocked a new value chain around the so-far-discarded cocoa pulp. Working closely with cocoa smallholders, Koa reduces on-farm food waste around the cocoa fruit and generates additional farmer income, while bringing unique new ingredients to the food and beverage industry for applications ranging from chocolate, confectionery, ice cream to drinks.
“We are excited that we won strong and reputable partners for the further growth of our business. It shows that our way of responsibly doing business and our value proposition are meeting the pulse of the time. With these investments, we will be setting up Africa’s largest cocoa pulp processing plant in West Africa which is the world’s largest cocoa growing region,” said Benjamin Kuschnik, Co-Founder and Group Finance Director of Koa.
‘People, Planet and Profit’
The investment round was led by Haltra Group, a Luxembourg-based family investment company which is joined by a group of other like-minded family offices all sharing Koa’s conviction to establish a business that creates real impact while being profitable and sustainable on the Triple Bottom Line: People, Planet and Profit.
“As a family investment group focused on managing assets and having a positive impact, we promote the emergence of disruptive and sustainable economic models for future generations. We are delighted to participate in this exciting venture at the edge of Circular Economy and Food Transition, two of our core investment themes, and to contribute to impacting the local communities in Ghana,” said Matthieu Baumgartner, Co-Founder of Haltra.
The equity round is complemented by a $3.5 million long-term debt facility from impact funds and $2.0 million of shareholder loans.
Koa said it is investing the funds from the debt financing into a new production plant in Akim Achiase, in the Eastern Region of Ghana. This will be Koa’s second factory, which is already in construction and is planned to start its operations by the end of 2022.
“As the food industry is discovering the cocoa fruit, we need to grow in line with the demand from our customers. Once fully operational, the new factory will increase our production capacity by tenfold, while generating 250 new jobs in rural Ghana and allowing us to extend our cocoa fruit upcycling to an additional 10,000 cocoa farmers,” Daniel Otu, Production & Operations Director at Koa, explains.
The Landscape Resilience Fund (LRF) and IDH Farmfit Fund have also announced a $3.5 million investment in Koa, to set up a new processing facility in Ghana, increasing production capacity more than tenfold by 2024 and creating additional income for up to 10,000 cocoa farmers.
Francis Appiagyei-Poku, Finance Director of Koa Impact Ghana said: “The investment from the IDH Farmfit Fund and the Landscape Resilience Fund allows us to extend our positive impact to new cocoa growing regions in Ghana. Making use of the previously lost cocoa pulp, we can increase and diversify smallholder farmers’ income. This investment in a new factory will create additional income for up to 10,000 cocoa farmers. Furthermore, the new production plant will create 250 jobs and new vocational opportunities for communities in rural Ghana.”
Globally, there are over 270 million smallholder farmers who lack access to affordable finance to invest in their farms, increase productivity, and transition towards climate resilient agriculture. To meet this challenge, the Landscape Resilience Fund and the IDH Farmfit Fund are working to increase farmers’ income and improve their resilience in the face of climate change.
Sarah Afful, a cocoa farmer from the community Assin Ayigbo working with Koa, feels the disruption of seasonal patterns. “I experience unusually heavy or lack of rainfall and that negatively affects my cocoa yield. Using more of a cocoa farm’s potential in an efficient and sustainable way is therefore key to strengthen resilience.”
Barbara Visser, COO of the IDH Farmfit Fund, said: “Koa furthermore aims to create gender equal employment opportunities in rural communities and targets to reach 40% women farmers, which are in line with core objectives of the IDH Farmfit Fund. We are very pleased that today’s investment will support Koa in responsible value creation in the cocoa supply chain. These kind of disruptive and innovative solutions are key to catalyse the system change that is needed to improve the lives of these cocoa farmers.”