Financing for Agri-SMEs in Africa (FASA) has made a $5 million investment in Catalyst Fund, a pan-African venture capital fund and venture builder that backs early-stage entrepreneurs developing adaptation solutions to droughts, extreme weather events and mounting food insecurity across the continent.
The announcement marks the first deployment of capital since FASA became fully operational in early 2025, and confirms its position as a catalytic anchor investor in a market where capital has historically refused to go.
The stakes could hardly be higher. Africa’s agricultural sector is haemorrhaging opportunity on a staggering scale. Agri-food small and medium-sized enterprises deliver 65 percent of all food consumed across the continent, yet they face an annual financing gap estimated at $180 billion, compounded by systemic gender barriers and accelerating climate risk.
Meanwhile, approximately 307 million people across Africa were undernourished in 2024, more than one in five of the continent’s population, reversing a decade of hard-won progress, according to the United Nations Food and Agriculture Organisation.
FASA’s $5 million junior equity stake in Catalyst Fund is not merely symbolic. It is structural. By absorbing first-loss risk, the riskiest slice of the capital structure, FASA’s subordinated position directly de-risked the overall funding round, opening the door to senior investors who would not otherwise have committed capital.
Catalyst Fund has now reached $30 million in committed capital, with co-investors including the International Finance Corporation, Trafigura Foundation, Blink CV, Shell Foundation and high-net-worth individuals. The fund is targeting a final close of $40 million.
“By backing Catalyst Fund, FASA demonstrates how catalytic capital can mobilize commercial capital in challenging markets,” said Mamadou Ndao, FASA Investment Director. “We chose to invest in Catalyst for its high additionality, its team’s strong track record in venture building, and its clear commitment to agriculture and climate-smart solutions that improve livelihoods. Through FASA’s subordinated capital and technical assistance, we believe that Catalyst Fund can achieve an impact otherwise unattainable. We are committed to supporting this exceptional team as they actively invest and grow technology solutions for climate adaptation on our continent.”
Catalyst Fund’s founding Managing Partner, Maelis Carraro, was equally direct about what FASA’s entry made possible.
“FASA’s junior equity investment was truly catalytic: by taking first-loss risk, it materially de-risked the round and unlocked commitments from senior investors who would not have participated otherwise,” she said. “Just as important, FASA ran a rigorous, high-quality due diligence and actively facilitated discussions with other LPs, helping align expectations and accelerate decision-making. We’re also excited about the climate-smart agriculture expertise they bring to the partnership and to leverage this for our portfolio. The combination of catalytic capital, investor discipline, and hands-on partnership is rare and was decisive in allowing Catalyst Fund to scale.”
A VC fund built for the frontlines of climate adaptation
Catalyst Fund is not a conventional venture capital vehicle. Designed by a first-time fund manager, it targets the earliest and most capital-starved stage of the entrepreneurship lifecycle, making initial investments of approximately $200,000 and providing follow-on funding, combining cash with hands-on venture-building support. Its investment thesis sits at the precise intersection of climate, financial inclusion, and technological innovation a triple mandate that has historically struggled to attract institutional capital at scale.
The fund’s three strategic pillars are sustainable livelihoods, climate-smart essential services, and climate resilience through fintech. Its existing portfolio illustrates both the ambition and the market logic:
Mazao Hub, a digital platform in Tanzania providing farmers with hyper-local soil analytics, agronomic insights, and market access; Keep it Cool, delivering cold-chain solutions to fish and poultry farmers in Kenya to reduce post-harvest losses; Oko, an insurtech offering crop insurance to smallholder farmers in Côte d’Ivoire, Mali, and Uganda; and Farm to Feed, a Kenyan digital platform connecting smallholder farmers to buyers and cutting food waste out of the value chain.
Over the next several years, Catalyst Fund has set targets that are measurable and unambiguous to improve the climate resilience of 200,000 smallholder farmers, create 3,000 jobs, and help restore or sustainably manage 350,000 hectares of land.
Before FASA’s entry, Catalyst Fund had already received early backing from FSDA Africa, FSDA Investments, Cisco Foundation, and individual investors enough to prove its concept and build an initial portfolio. But scaling beyond proof-of-concept required a different class of capital: patient, subordinated, and willing to bear disproportionate risk to crowd in the private money that follows.
FASA’s broader mission: $200 million to move $1.7 billion
FASA itself is a fund-of-funds, a vehicle that invests in other funds rather than directly into companies designed specifically to tackle the structural vacuum in African agricultural finance. Backed at inception by Norway, the United Kingdom’s Foreign, Commonwealth and Development Office, the Korea International Cooperation Agency, and the Small Foundation, FASA launched with an initial capitalisation of $86 million.
That figure, while significant, barely scratches the surface of the problem it is trying to solve. Eligible funds across the African continent are estimated to be seeking a combined $3.8 billion in capital. FASA’s current firepower covers only around 2 percent of that demand. The fund-of-funds is actively raising new commitments toward a total target size of $200 million, with an ambition to invest in approximately 20 funds and ultimately unlock $1.7 billion in capital for agricultural SMEs across the continent.
Managed by a team operating across four offices Senegal, Ghana, Kenya and France, FASA has moved quickly since becoming operational. It has already received more than 100 fund applications at various stages of maturity and built an advanced pipeline of around 20 eligible funds across four main asset classes: early-stage SME funds, growth SME funds, venture capital and debt vehicles.
“While most funds in our pipeline are strongly agri-focused, we also take a pragmatic approach, backing generalist funds that allocate at least 30% of their capital to agriculture and align with FASA’s impact themes: improving livelihoods, enhancing food security and nutrition, and promoting climate-smart agricultural value chains,” said Wiem Abdeljaouad, FASA Managing Director. “With an experienced team and a growing pipeline, we will continue delivering FASA’s mission: deploying catalytic capital, closely supporting fund managers with fund design and fundraising while further building their capacity, notably on gender and climate topics, and sharing lessons to advance agri-SME finance on the continent.”
FASA’s mandate extends beyond capital alone. Alongside its investment in Catalyst Fund, it is providing technical assistance to accelerate the growth of top-performing agricultural startups in the portfolio and to strengthen the fund manager’s capacity to measure impact and embed environmental, social and governance best practices across its operations.
