founder

Founder Profile: Luni Libes of Africa Eats

Introduction

The relationship between poverty and hunger is especially apparent in Africa, which is home to more than 25% of the world’s hungry. This poverty partially stems from agricultural issues, including poor infrastructure and unequal trading terms with outside countries. Because agriculture plays a major role in the African economy, improving the industry could provide enormous benefits across the continent.

Africa Eats is helping African businesses involved in the agricultural supply chain. It consists of two parts: Africa Eats Ltd., a holding company with a portfolio of 27 African companies, and Africa Eats SPC, which provides those companies with services to help them succeed. We reached out to co-founder and CEO Luni Libes to learn the company’s origins and how it finds other companies to invest in. 

Note: This interview was conducted over phone and email. It has been lightly edited for clarity and length.

Léa Bouhelier-Gautreau

In your own words, how would you describe Africa Eats?

Luni Libes

Africa Eats is a for-profit company focused on lessening hunger and poverty in Africa through formalizing and growing the food/agricultural (ag) supply chain between smallholder farmers and retailers. Africa Eats works with nearly 30 young, fast-growing companies based in 10 countries in Africa, all founded by Africans and all working toward these same goals. Most of these companies aggregate food grown by smallholder farmers, apply some processing, and then distribute to retailers. More than 100,000 farmers per year supply food to tens of thousands of retailers.

Léa Bouhelier-Gautreau

What inspired you to take the leap and start this company?

Luni Libes

Traditionally, issues like hunger and poverty are left to philanthropists and governments to solve. But the issues only grow. Meanwhile, hunger and abject poverty are all but eliminated in the US and Europe, and that wasn’t done through charity or hand outs. It came about through 100 years of expansion of the food/ag supply chain, growing incomes for farmers so that farming could be mechanized, and growing levels of education so that the children of farmers could build the rest of the economy. The same happened in China and India over the last few decades for hundreds of millions of their populations. The same will happen in Africa in the coming decades. Africa Eats is getting in early to both help push that inevitable growth along as well as to profit from the effort.

Léa Bouhelier-Gautreau

Who is on your team and how did you come together?

Luni Libes

I wrote the business plan back in 2018 and vetted it with institutional investors over the next year and a half. Then, before formally launching, I invited Jumaane Tawafa to join me as co-founder. I met Jumaane in Nairobi back in 2016, when he worked for Equity Bank. My equity background and his banking background were a good match. Jumaane then recruited Saif Ahmed to make us three, with Saif having decades of experience building agricultural businesses across Africa.

Léa Bouhelier-Gautreau

What is your business model and how do you differentiate?

Luni Libes

This is where the full story gets a little complicated. Africa Eats is a multinational with two corporate entities. Africa Eats Ltd. is an investment company domiciled in Mauritius. Its business model is to invest in the portfolio of companies, growing the value of that portfolio so that the investment company itself can be listed in a public stock exchange. Meanwhile, Africa Eats SPC is a US-domiciled company that provides services to those same companies, earning an income by charging for those services. Such services include financial management, solar leases, truck leases, and a shared savings service with other services to be added as they are needed. Combine those two together, and there isn’t another entity that we know of following this model for young companies. The closest equivalent – and the company we look to for inspiration – is Berkshire Hathaway, the multi-billion dollar investment holding company run by Warren Buffett.

Léa Bouhelier-Gautreau

How do you select the companies that you invest in through Africa Eats Ltd. and that use the services of Africa Eats SPC? How long do you expect them to use Africa Eats' services?

Luni Libes

All the founders of all the companies attended a Fledge business accelerator somewhere in the world sometime between 2014 and 2020. Some of these founders had other companies in those programs, and some of the founders have started second or third companies since graduating. The Africa Eats portfolio consists of all the food/ag companies from these founders.

Fledge selects its participants based on three criteria: team, impact, and odds of success. “Team” means young companies need to create leadership teams. “Impact” means all the companies solve real problems of the world, with those solutions embedded within their products or services. “Odds of success” are the common criteria for analyzing companies: historic revenues, growth rate, profitability, competition, capital needs, etc.

Léa Bouhelier-Gautreau

How do you support Africa Eats Ltd. companies?

Luni Libes

Support comes in a variety of ways. It begins with advice, not just from Jumaane, Saif, and I but often from the other entrepreneurs. We foster peer-to-peer solutions, as we have dozens of African entrepreneurs and more than 100 African managers with first-hand experience dealing with the challenges of growing businesses in Africa. Next, we add to that service to solve common issues. For example, the electric grids are unreliable, so we spun up a service to provide solar leases at a cost less than the electric grid charges but at a profit to us. Lastly, we connect our companies to other investors and other service providers, as we can’t solve all their needs ourselves.

Léa Bouhelier-Gautreau

How do you intend to use the money you raise this round to scale the business?

Luni Libes

The capital being raised on Wefunder will go toward expanding our services: more solar leases, more truck leases, more savings services, and likely new services, like a shared marketing team.

Léa Bouhelier-Gautreau

What do you want potential investors to know about you and/or your company?

Luni Libes

The opportunities in Africa are humongous larger than most Americans can imagine. The best way to wrap your head around this is to think about a company like Procter & Gamble. This public company is worth more than $350 billion dollars today. But 160 years ago, it was formed as a partnership of two American entrepreneurs, one who wanted to make soap and one who wanted to make candles. You know this company as Tide laundry detergent, Ivory soap, Old Spice, Charmin toilet paper, Tampax, Crest, Oral-B, and more. There are few brands of that scale in Africa today in food/ag, but it won’t take 160 years for pan-African brands to be at the scale.

Léa Bouhelier-Gautreau

As you think about the business 5-10 years down the road, what do you see exit opportunities looking like? Have you set any future goals for the company?

Luni Libes

The expectation is that Africa Eats, the multi-national, will be listed on an African stock market in the next year or two, and then it will be listed on the London Stock Exchange within the next seven to 10 years. Currently, 127 African companies are listed in London, making it the largest stock exchange in the world for African companies, bigger than both exchanges in New York. Investing in both Africa Eats Ltd. and Africa Eats SPC means we will be able to sell shares after those milestones or, like Berkshire Hathaway, hold our shares as long as we like.

We look forward to seeing where Luni and his team take the company. Africa Eats is currently raising on Wefunder.

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About: Léa Bouhelier-Gautreau

Léa is passionate about impact investing and sustainability. Prior to KingsCrowd, she worked for Stanford’s accelerator, StartX, helping to select the most promising entrepreneurs. She also led the first award-winning study on the Malawian startup ecosystem. In her free-time, she volunteers to help entrepreneurs in Cameroon, Brazil and Colombia. Léa holds a degree in Anthropology from France and is currently enrolled in the UC Davis MBA program.

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