Acumen commits $300M to boost climate adaptation for smallholder farmers

Acumen, a global nonprofit impact investor, will commit $300 million over the next five years to support startups and small businesses that work with smallholder farmers to improve their climate adaptation across East and West Africa, India, Latin America, and Pakistan. The pledge comes amid the 29th United Nations Climate Change Conference, or COP29, in Baku, Azerbaijan, where food systems have once again emerged as a major topic of discussion, as the need to equip farmers with tools and support to grapple with the effects of climate change becomes increasingly clear. The International Fund for Agricultural Development estimates a $75 billion annual shortfall in funding for small-scale farmers in developing countries in adapting to climate change. Climate adaptation projects often struggle to attract private funding because they’re seen as high-risk — especially compared to mitigation projects, which are seen as safer and are perceived as having higher returns on investment. Only $7 billion of the $660 billion in global climate finance supports agrifood adaptation, or 1% of the total. This is despite evidence that shows that it can be a solid investment: For example, every billion dollars spent on coastal flooding prevention can save $14 billion in damages, and investing $16 billion a year in agriculture could keep 78 million people from going hungry, according to the U.N. Environment Programme. According to a statement from Acumen,“The $300 million agricultural adaptation investments are expected to be made into 100 companies spread across the following Acumen programs over five years: 1. Pre-seed stage equity and technical assistance for innovative climate solutions that create new markets; 2. Pre-seed equity and technical assistance for productive use of energy in agriculture innovations; 3. Seed and growth stage equity and technical assistance for scaling climate businesses in sub-Saharan Africa; and, 4. Early and growth stage equity and technical assistance for scaling climate-focused agribusinesses in Pakistan.” Acumen also says it plans to leverage this $300 million to mobilize an additional $1.2 billion in investments from a mix of public and private investors. Some of its existing investments in food systems include a company in Kenya, Kentaste, a top East African coconut producer, and S4S, which provides solar dehydrators for farmers in India. The funding, Acumen says, is designed to reach 40 million farmers by 2030 and contribute to a more resilient food system that could feed 1 billion people. Chris Wayne, Acumen’s associate director for agriculture, emphasized the urgent need for increased adaptation funding. “A new generation of agricultural entrepreneurs is creating the innovations needed to build climate resilience for smallholder farmers — and we intend to support them with this new investment,” he said in a press release.” It’s unacceptable that smallholder farmers, who supply 30% of the world’s food, are among the world’s poorest.”