17 Aug Barka Fund
Barka Fund
Interview with Rekia Foudel; Managing Partner of Barka Fund
Jen: How was the Barka Fund Created?
Rekia: Rekia started the fund to solve the problem of how to move public and private capital directly to thousands of ecopreneurs, in the missing middle of the financial spectrum in Africa, working to create value for the benefits of their communities. After living in Niger and experiencing the impact of climate change on the people and land, Rekia launched Barka to support innovative founders who are building scalable, market-based solutions to fight the impact of climate change, by restoring vital lands, creating green jobs and contributing to carbon sequestration.
Jen: How are your investment funds catalytic in a way that is different from other funds?
Rekia: Few impact funds investing in Sub-Saharan Africa focus in Sahelian countries and even fewer, focus on early-stage companies, providing finance of less than $500,000. Barka’s value proposition strongly aligns with these underserved needs: we are exclusively focused on early- stage ventures, targeting missing middle companies, considered too big for micro finance and too small and too risky for impact investors and banks. We invest in the Sahel, bringing institutional scale capital and support to this disadvantaged population. Our intervention can lift millions out of poverty and help build enduring ventures.
Jen: How do you describe the kind of non-financial returns the fund offers?
Rekia: Barka aims to provide investments to the world’s most under-served region. We are an impact-first investor, seeking to optimize social and environmental returns with financial returns. Two SDGs lie at the core of Barka’s mission and vision: SDG 13 on climate action and SDG 5 on gender equality.
Our impact targets for climate action align with AFR100 and the Great Green Wall (GGW) initiatives. Barka aims to contribute to AFR’s mission to restore 100 million hectares of land in Africa by 2030 and to the GGW’s objectives to combat desertification and improve lives in the Sahel region. The 8,000-kilometer green belt of the GGW will sequester 250 million metric tons of carbon and create 10 million green jobs. In addition, Barka embraces a gender-inclusive investment approach, which outlines interventions such as gender analysis of the investees’ value chain, quotas in our technical assistance programs and specialized coaching and mentoring. These measures enable us to progress towards our goals effectively.
Jen: Can you describe how you use integrated capital to do your work?
Rekia: The Fund works exclusively through incubators and accelerators to help screen and select applicants to our programs. We then offer a pre-investment readiness program to selected founders to prepare them to meet investors’ conditions and successfully raise capital from us and other investors. After determining which companies will best benefit from our support and investments, we offer both equity and debt investments. We are purposefully flexible as the capital needs of the “missing middle” companies are diverse. Finally, we offer a comprehensive post-investment support that include mentorship and business support to these high-growth, early-stage, climate-focused startups. This integrated approach is funded with both commercial investments and a technical assistance facility, allowing us to show commercial viability and developmental impact in the fragile, frontier markets where we operate.
Jen: How do you address racial justice, income inequality, and/or gender justice through your products and services?
Rekia: Barka invests in climate companies in three sectors: environment and natural resources, agriculture and food systems, and energy. In the environment and natural resources sector, our companies focus on carbon sequestration, ecosystem restoration and sustainability solutions. In agriculture and food systems, their priorities include enhancing agricultural productivity, reducing food loss and optimizing input and system efficiency regardless of climate change. In the energy sector, our companies strive to increase clean energy production, minimize energy inefficiencies and improve energy access, particularly electricity access, with an equity agenda. These companies’ activities are crucial for poverty and inequality reduction as climate impacts disproportionately affect the poorest and most vulnerable populations, including women and youth. Mitigating its effects safeguards livelihoods, fosters sustainable economic growth and diminishes poverty. Barka contributes to job creation, technological advancements and economic development, ultimately fostering a more vibrant and dynamic economy in the countries we invest.
Working with small-holders farmers to provide access to market in Tongo.
Jen: Can you share with us an example of an investment?
Rekia: We are very proud to support Herou Alliance. Herou is a startup building an inclusive Moringa company in Mali. The company’s mission is to empower and create economic, environmental and social impacts for thousands of smallholder farmers, mostly women and young people. The company works directly with farmers and provides technical assistance, climate-smart seeds and organic fertilizers so that they plant moringa alongside their other trees and crops. Then, Herou purchase the production, effectively providing access to market, processes and transforms the moringa into tea, powder and other high-value goods and distributes to customers in Africa and Europe. Herou is woman-owned and led by a dynamic, green entrepreneur, who won many global recognition, accolades and awards. Her most recent ones include the World Economic Forum Uplink Top innovator, Israel-sponsored Desertech Challenge winner, 2022 World Resources Institute’s Land Accelerator Africa champion, Youth peace ambassador ICESCO, Sustainable Green Leader and a 2022 Mandela Washington fellow and Young African Leadership Initiative winner.
Jen: What do you tell people who think your fund is risky?
Rekia: We are aware that investments in climate-focused, early-stage startups, in frontier markets present with many risks. Therefore we designed our fund to provide diversification across different countries and asset classes within the portfolio. Diversification helps to mitigate specific risks associated with any one region, making the overall investment portfolio more resilient. In addition, Africa is home to some of the fastest-growing economies and consumer markets, presenting unique investment opportunities for those like us, willing to navigate the landscape. The emerging market potential is there. Lastly, we use a long-term investment lens, taking a long-term perspective to help smooth out volatility and capture the full potential of growth.
Important to note, for impact-minded investors, without our intervention, there will be increased food insecurity, increased land degradation leading to famine and loss of life, affecting more than 400 million inhabitants of the Sahel and neighboring countries. In recent years, the region has seen a rise in Islamist insurgency and severe humanitarian crises, leading to mass migration. Developing economic opportunities, such as Barka’s efforts to effectively direct support and funding to SMEs working on the regeneration of vital lands, creating green jobs and other programs that provide economic opportunity across the region, will help develop the region and advance U.S and international foreign policy.
Investment Thesis/What is your rationale for your approach to investing?
Barka is an early-stage impact fund that invests in African founders building companies that mitigate and adapt to the impact of climate change. We focus on startups in the “missing middle” of the financial spectrum, primarily in francophone countries, tapping into a largely non-saturated market that presents opportunities similar to other regions in Africa.
Geography: Africa
Year Founded: 2020
# of Investments: N/A
# of Investors: N/A
Funds Raised: N/A
What’s on Rekia’s Mind?
Book: The Road Less Traveled by Scott Peck
Song: Victony – Soweto ft Omah lay (Remix)
Podcast: Afrobility: Africa Tech & Business