Agriculture remains the bedrock of Africa’s economy, contributing around 30% of GDP and employing over two-thirds of the workforce. But the sector is under pressure as global demands shift. Food waste and post-harvest losses, where crops spoil before reaching the market, contribute to increased carbon emissions, transforming what was once just an economic problem into a climate challenge.
To compete in premium export markets, African producers are under pressure to overhaul their farming practices. That means adopting climate-friendly solutions from a new wave of climate-smart agtechs: cutting waste and tracking output to meet the standards of global buyers. But climate-smart agriculture (CSA) companies in Africa must battle funding constraints and low digital literacy rates amongst smallholder farmers (who are the hardest to reach and least able to pay) to scale their solutions.
The funding bottleneck
Over the past decade, climate-smart agriculture ventures have attracted about 18% ($797 million) of all ClimateTech funding across the continent, according to data from Briter’s agriculture-specific intelligence platform: AgBase. Roughly two-thirds (66%) of this total funding flowed into a few growth-stage ventures, leaving early-stage and localised innovators out in the cold. “Agriculture is traditionally capital-intensive, so investors tend to gravitate towards later-stage, “platform” players,” said Romain Diaz, CEO and Founder of Satgana Ventures. The funding landscape is not immune from herd mentality: “Once a handful of companies prove traction, they attract disproportionate capital, while earlier-stage, more localised solutions remain underfunded,” Diaz adds. According to him, the perceived risks of agriculture in emerging markets often mean capital concentrates into a few “safer bets,” rather than being spread across a wider portfolio of innovators.”
How founders are closing Africa’s CSA adoption gap
On the ground, founders say building tech is only half the battle: convincing farmers, often with low digital literacy, to use the tools is equally hard. To close the gap, more companies are turning to agent models with local field staff and in-person support.
“Even the simplest new product needs a 'person in the middle' who is either going to do it for them or help them do it. We have to find a way to make products applicable or usable at the moment,” says Alexandra Ngaiza, Business and Partnership lead at Tanzania-based MazaoHub. The startup follows a hands-on approach, integrating soil testing, farm enterprise resource planning (ERP) systems, and agricultural clinics. Their multi-sided business model means farmers pay for precise soil tests (about $15), ERP access, and input advice, while clinics deploy trained agents to help users understand and implement these tools. This approach not only supports good agronomic practice but also links producers to market through cropsupply.com, leveraging logistics and traceability for premium sales.
Nigeria’s Agrify began as a carbon credit marketplace but soon realised that offsets alone weren’t enough to attract farmer participation. Farmers were more motivated by profitability and market access than by climate metrics. In response, Agrify pivoted to a bundled model that uses satellite data and AI to assess soil health, provide coaching, and generate a farm's credit score for lenders and buyers. The platform now covers digital traceability, escrow-enabled payments, and access to new markets, with revenues from matchmaking and coaching fees.
Airsmat in Nigeria transforms agricultural waste, mainly corncob, into biochar, a soil conditioner and climate tool that sequesters carbon. Farmers not only improve yields and resilience but also access new income streams via carbon credits (sold in USD), awarded for soil carbon improvements independently verified in Airsmat’s proprietary digital MRV (monitoring, reporting, and verification) systems. Airsmat claims to be the first in Nigeria to issue carbon credits directly to local farmers. The startup uses a revenue share system, selling certified carbon credits (validated by traceability software) to international buyers and distributing proceeds to partner farmers. The company also mixes biochar with compost to act as both a fertiliser and a soil conditioner.
Regulation and risk aversion
For Africa’s new crop of agtech startups, building a product that works is only half the job. Helping the average smallholder trust, use, and benefit from that product while investors and regulators catch up remains the bigger lift.
“[Climate-smart Agriculture] isn’t as prioritised because it’s still not that mature,” says Ngaiza. While investors and other stakeholders are aware of the leading companies, Ngaiza believes many investors and stakeholders are still not familiar with the numerous young and early-stage startups. This lack of awareness often leads to hesitation in capital deployment to CSA compared to other sectors.
Furthermore, for companies in the sector, policy inertia and lack of tailored regulation mean considerable friction when trying to innovate at speed. "If we are regulated, it shouldn't be hard for us to reach farmers or to support farmers. But right now, you just can't walk into a region and start introducing your technologies and your services,” says Ngaiza of MazaoHub.
There’s also little confidence among founders that local investors understand the long game in CSA. Startup founders we spoke with, like Agrify’s Delz Erinle, say most backers are fixated on quick wins and short-term revenue, not the patient funding or bigger risks needed for breakthrough growth. “Investors want traction... but deep tech needs patient capital,” he says. For now, founders claim, too many promising ideas in African climate tech are stuck waiting for capital to catch up. “We need a new class of investors who are willing to back founders at the idea stage, not just after there’s obvious traction,” says Erinle.
Agbase’s H1 investment report shows that a growing number of concessional funders and venture funds such as Catalyst Fund, Mercy Corps Ventures, and Equator VC have deployed $250,000 to $1 million tickets into early-stage models, an area where many public and private funders have typically been hesitant to engage. Without such funding, the pipeline of breakthrough agtech solutions may stall. However, perceived risks in unproven models, along with limited success stories, contribute to funder reluctance at this stage, according to Briter’s Playbook for climate financing in Africa.
Patient Capital can unlock scale for African CSA
Both founders and investors agree that African CSA companies need patient capital to thrive. “The timing of the development cycle for the innovation should be aligned with the type of funding that is received,” said Eugene Gikonyo, Principal at Mercy Corp Ventures.
Across African ClimateTech ecosystems, fewer than 20% of companies that raise under $250,000 at pre-seed survive to a priced seed round, according to Briter’s climate financing playbook. In order to build a robust ecosystem and to have players across the continuum of capital, Gikonyo advocates for having more funds dedicated to early-stage financing for CSA. Gikonyo also advocates for more concessional low-ticket working capital solutions that are well-suited for these early-stage ventures.
Investors in Africa’s climate-smart agriculture sector are upping their standards, looking for ventures that deliver both commercial results and real-world climate resilience. For Romain Diaz of Satgana Ventures, it’s not enough to “design for the farmer” - founders must “deeply understand farmers’ realities and design with them.” Diaz says he is looking for “scalable unit economics” but also stresses the need for affordability, accessibility, and solutions that fit “existing value chains” and adapt across “different crops and geographies.”
His bottom line: the best bets are those “that can correlate climate impact with commercial viability in some of the most fragmented markets.” Other investors emphasise sustainability, with Samuel Frank of Sahara Impact Ventures noting, “I look out for companies providing organic inputs that meet international standards, as these help position farmers within the global push toward sustainability.” In practice, investors now expect businesses to show climate impact, farmer buy-in, and a credible route to scale, whether that’s in aggregation, export, traceability, or processing downstream agri products.
How Africa’s CSA compares with other emerging markets
Compared to other emerging markets, Africa’s climate-smart agriculture companies are running the same global race: improving soil health and capturing value from export markets, but with local twists in technology and adoption. In Latin America, many agtech ventures are using artificial intelligence in bioinformatics, speeding up biological product development and targeting export relationships. African companies are also innovating to reach premium buyers, most often in Europe, with platforms like Agrify building online marketplaces to connect local farmers to international trade opportunities.
Yet, the leap to high-tech isn’t always a straight line. While LatAm’s surge in AI-driven tools demonstrates what’s possible, African investors remain wary of overstating its current impact. “AI should be a feature and not the product. AI does not solve all the structural issues (of distribution and scale) in African agriculture. So slapping AI on it is not going to be a silver bullet in the ecosystem,” says Eugene Gikonyo, Principal at MercyCorp Ventures.
What’s common across regions is the push for bundled services. “One parallel we see is the importance of bundling, i.e. combining agronomic advice with access to markets, inputs, or credit. Another is the use of mobile-first distribution models, which allow solutions to bypass traditional bottlenecks,” says Romain Diaz, CEO and Founder of Satgana Ventures. For Africa, the next frontier may well be about integrating world-class analytics and business models, but ensuring relevance for fragmented supply chains and smallholder realities remains the priority.
Gikonyo also predicts that global food and beverage companies will sharpen their focus on the continent. “Aggregators and consumer goods companies in the Global North, which are focused on building more resilient supply chains and improving visibility, will increasingly look to Africa and African-founded companies to address some of their supply chain pain points,” he added.
The innovation model for CSAs on the continent is also expected to shift. “There’ll be more integration and system-based creation of solutions, as opposed to standalone services, so single-service startups will evolve into ecosystems that combine soil health data, crop insurance, market access, and digital payments,” notes Gikonyo
Africa’s next wave of climate-smart agriculture will depend on aligning innovation with capital that understands its timelines. Data and visibility, the kind we track at Briter, will be key to bridging that gap.
For more data and analysis on climate innovation and agriculture, read our latest climate financing playbook: Build, Commercialise, Grow: A Playbook for Financing ClimateTech in Africa. You can also find our other climate reports at briter.co/insights.
