September 27, 2022

By Lynda Kiernan-Stone, Global AgInvesting Media

Flow Equity has a successful business model. Mainly operating in Ethiopia via its subsidiary EthioChicken and Rwanda through its subsidiary Uzima Chicken, Flow Equity’s primary product is high-yielding, day-old chicks (DOC). 

Taking a unique approach, the DOC are sold in a package including the necessary feed and vaccines to the company’s network of trained agents who raise the chicks for the first month, producing specific breeds of healthy, vaccinated pullets and cockerels that are then sold to smallholders.

The breeds that are raised produce 3-4 times more eggs compared to typical local chickens, and add more than 2 kilograms in three months living in a village environment, representing a productivity gain of at least three times for smallholder farmers.

“We are very proud to supply dual-purpose poultry that is perfect for the smallholder farmer in our markets in Africa,” said Joseph Shields, co-founder, Flow Equity. “The chicken is resistant to disease and highly productive for both meat and egg production compared to the local chicken. Our model requires less feed per kg of meat or egg produced, which is critical in this period of high grain prices and reduces the environmental impact from animal farming.”

This inclusive distribution model enabling Flow Equity to meet the rapidly growing mass market demand for protein among the widest population base has also gained the support of some of the most prominent investors in African agriculture and food – closing on $14 million in combined funding from AgDevCo, AHL Venture Partners, Acumen Resilient Agriculture Fund (ARAF), and the Bill and Melinda Gates Foundation. 

The Mission

At 33 percent, sub-Saharan Africa has the world’s highest rate of children under the age of five facing stunted development due to food insecurity and a lack of protein, according to the World Bank.

David Ellis, co-founder of Flow Equity, has more than a decade of experience in emerging markets, explained, “we started the company with the mission to make farmers healthier and wealthier, and this investment will enable us to reach many more farmers across sub-Saharan Africa.”

EthioChicken was founded in Ethiopia in 2010 and has grown to be the industry leader, selling over 25 million chickens per year. It has received funding from international impact investors, including the IFC and FinnFund, and has garnered global recognition including the 2018 Boldness in Business Award from the Financial Times and is one of the only poultry companies on the continent to achieve Global GAP certification.

Building on this success, the company launched Uzima Chicken in 2017 in Rwanda and Uganda, posting more than 100 percent dual-purpose poultry market growth in both countries with strong market penetration supported by 1,000+ agents and a network of 500,000+ farmers.

“We have shown the scalability, impact, and profitability of our model in Ethiopia, and believe we need to make our products available to access the enormous market opportunity serving farmers throughout Africa. We are honored to work with these investors that support this long-term vision,” said Ellis.

With this funding, the company plans to expand its operations into new African markets, hoping to indirectly create over 30,000 jobs, and reach millions of smallholders, increasing their income by $200 million per year by 2026.

“There are few better examples in African agriculture of investments delivering both impact at scale and healthy financial returns than Flow Equity” said Chris Isaac, CIO, AgDevCo. “We’re delighted to have backed the company to set up operations in Rwanda and Uganda and we’re excited to support the expansion into new countries.”

Rosanne Whalley, CEO, AHL Venture Partners, added, “We believe that the company accesses a huge addressable market supported by the growing population, rising disposable income, and increasing demand for nutritious food. Flow Equity’s outstanding traction has demonstrated a solid commercial case for us, its mission-driven business further aligns with our impact DNA. We can’t wait to support the team in executing its growth plan, hereby improving the income and food security for many more households in Africa.”

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

*The content put forth by Global AgInvesting News and its parent company HighQuest Partners is intended to be used and must be used for informational purposes only. All information or other material herein is not to be construed as legal, tax, investment, financial, or other advice. Global AgInvesting and HighQuest Partners are not a fiduciary in any manner, and the reader assumes the sole responsibility of evaluating the merits and risks associated with the use of any information or other content on this site.