OKO has closed a seed investment of USD$1.2 million (approx. UGX4.4 billion) in a funding-round led by by Newfund and ResiliAnce. Other investors including; Mercy Corps Venture, Techstars, ImpactAssets, and RaSa also participated in the round.
The Insurtech startup is providing inclusive agricultural insurance to secure farmers’ income in Mali and Uganda where they currently operate. With the new funding, OKO aims to strengthen its presence in Mali and Uganda as well as expand its operations to more markets across Africa, starting with Ivory Coast.
“Agriculture is by far the largest source of occupation in Africa, with an estimate of over 33 million farms —and yet farmers are deprived from basic financial services like insurance and loans. Therefore, we are using technology to solve this issue and secure the income of those farmers,” Simon Schwall, Founder of OKO said in a press statement.
Their solution saw investors like Newfund pick interest in supporting them.
“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 and Uganda from which OKO can now expand in new countries and offer new insurance products,” said, Augustin Sayer, partner at Newfund.
OKO 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. Last year, the company compensated more than 1,000 farmers in Mali whose farms were affected by floods. Notably, in Mali, the company approximately has 7,000 farmers using their product.
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.
The startup takes pride in being the most inclusive crop insurance available. Farmers can use any type of phone; feature or smartphone to connect to OKO. Having partnered with mobile operators, farmers dial a short code to obtain the insurance information and later pay through mobile money services.
“OKO has taken full benefit of the Orange Money platform to provide a service that is both innovative and inclusive,” Aicha Toure, CEO of Orange Money in Mali, comments.
Daniel Block from Mercy Corps Ventures added that, “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.”
Schwall noted that they need to find more partners who can help them expand their product to more farmers across Africa. “We need more partners on board to help us with expanding our product —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,” he said.
OKO has won both the Fintech Showcase Awards by the Alliance for Financial Inclusion, representing financial regulators of emerging countries, and the SME award from ITU.