OKO raises $1.2 million to bring innovative insurance to smallholder farmers across Africa
OKO, an Insurtech start-up that provides inclusive agricultural insurance to secure farmers’ income across Africa, has closed a Seed investment of $1.2 million. The round was led by by Newfund and ResiliAnce. Mercy Corps Venture, Techstars, ImpactAssets and RaSa also participated in the round.
The start-up which currently operates in Mali and Uganda uses satellite data and mobile payments to create automated insurance products for farmers whose fields are affected adversely by weather events — primarily droughts and floods. With the new funding, OKO aims to strengthen its presence in Mali and Uganda and expand its offerings to more African markets, starting with Ivory Coast.
“Agriculture is by far the largest source of occupation in Africa, with an estimated 33 million farms. And yet, farmers are deprived from basic financial services like insurance and loans” says Simon Schwall, founder of OKO. “We are using technology to solve this issue and secure the income of those farmers”.
The company already has approximately 7,000 paying customers in Mali and compensated more than 1,000 farmers last year, who were affected by floods. OKO’s customers typically grow maize, cotton, sesame or millet. OKO also works with agro-industries to help them with their sustainability goals and secure their relationships with suppliers. Successful pilots were completed with ABInBev and Touton in Uganda.
This convinced Augustin Sayer, partner at Newfund, to support OKO: “We believe recent advancement in iOT and data availability will lead to the rise of parametric insurance in Africa for the benefit of the local populations. Simon and his team have built solid bases in Mali from which OKO can now expand in new countries and offer new insurance products.”
OKO takes pride in being the most inclusive crop insurance available. All farmers need to connect to OKO is a phone (no smartphone required): they can dial a short code to obtain more information and pay through mobile money services. To achieve this level of accessibility, the company partners with mobile operators. “OKO has taken full benefit of the Orange Money platform to provide a service that is both innovative and inclusive” says Aicha Touré, CEO of Orange Money in Mali.
Daniel Block from Mercy Corps Ventures added: "While other micro-insurance for farmers exist, we were impressed by OKO's ability to partner with a pan-African operator like Orange and establish a direct consumer link, which allows for an exciting opportunity to drive deeper user engagement and expand to a suite of insurance products for rural farmers in the future
The service offered by OKO is supported by regulators and has won both the Fintech Showcase Award by the Alliance for Financial Inclusion, representing financial regulators of emerging countries, and the SME award from ITU, the telecommunication governing body.
When asked about the next challenges for OKO, Simon Schwall’s answer is clear: “we need to find more partners who can bring our product to farmers, be it NGOs, agro-industrial players, mobile operators or governmental programmes. We proved that our solution is working and answers a strong need. Now we need to scale”
About OKO :
OKO secures farmers’ income in emerging countries using automated insurance solutions. OKO is accessible to anyone with a phone, and claim payments are automated using satellite data and images. OKO graduated from the Techstars programme in 2018 and was listed in 2020 among the 50 most promising solutions for Financial Inclusion (Inclusive50) by Visa and MetLife foundation.
OKO is active in Mali and in Uganda, with plans to expand to many more markets in the coming years.
Created by and for entrepreneurs, Newfund is a pre-seed / seed stage crossborder venture firm with $300m under management and 90 active portfolio companies. More information on: www.newfundcap.com
ResiliAnce is the corporate capital investment fund that accelerates the digital, economic, and sustainable transformation of global agro-industrial systems. We look for bold tech solutions to build resilient business models with positive social and environmental impact throughout the agri-food value chain. Thanks to our distinctive international networks and risk management expertise, especially in tropical countries, we offer both capital and mentoring, to propel seed stage startups to the next level"
About Mercy Corps Ventures
Mercy Corps Ventures leverages the global resources and reach of a leading development agency to provide high-impact enterprises with investment capital, value-added support and catalytic partnerships so they can scale solutions for underserved populations in fragile, frontier markets.
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