Milwaukee-based food upcycling startup Agricycle Global is poised to scale its new ingredients supply business after receiving support from nonprofit giants Mastercard Foundation and Partners in Food Solutions.
Agricycle chief executive officer Joshua Shefner launched the company in 2015 with a simple concept: sell solar-powered dehydrators to rural farmers in Africa to turn excess fruit that would otherwise go to waste into ethically sourced food products.
The startup works to eliminate extreme poverty by paying farmers up to seven times the average daily wage for their dehydrated fruit, according to the company. Agricycle then markets those products under its dried fruit snack brand, Jali Fruit Co., and Tropical Ignition, a fruit-based charcoal alternative.
Agricycle shifted focus from its food brands to its ingredient supply business, Field Better Ingredients, following a recent $2.7 million round of funding. The startup established a vertically integrated supply chain that produces more than 150 ingredients ranging from bananas and bitter berries to marjoram and moringa leaf.
Rather than build brands of their own, Agricycle aims to sell ingredients to consumer-packaged goods manufacturers in North America and Europe. The startup also sees potential in small businesses that have built food brands but want the storytelling and traceability elements of Field Better’s ingredients, Shefner said.
“All the hope and potential and really fast success with Jali and now Tropical can be replicated across a thousand other companies with Field Better,” Shefner said. “We don’t need to be the face of any of these brands as long as the farmers and the microprocessors are getting paid. That’s what we’re here to do.”
Agricycle’s supply chain has grown to include 35,000 farmers and about 7,000 women-led cooperatives in east and west Africa and Latin America, according to the company. Once farmers and cooperatives collect the ingredients, they’re brought to a network of village empowerment centers that Agricycle has established across its footprint.
Now the Mastercard Foundation is purchasing Agricycle’s dehydrators, setting up dozens of village empowerment centers and committing $850,000 to bolster the startup’s operations in Uganda, Shefner said. The nonprofit will also help Agricycle set up a product development lab in Uganda to help create formulations for ingredients that CPG manufacturers aren’t familiar with, Shefner added.
PFS, a nonprofit backed by Cargill, Hershey, General Mills and other corporate giants, will fund Agricycle’s new packhouse and milling facility in Kenya, Shefner said. The nonprofit will design the facility, its workflow and train its staff, he added.
What makes Agricycle’s model unique is that it managed to establish a supply chain across rural and remote farming communities in Africa, where there is deep-rooted skepticism for western nonprofits.
Most nonprofits approach these communities with “feigned ignorance” or a “walking on eggshells approach,” Shefner said. But with Agricycle, Shefner said, he laid out the math and revenue-generating opportunity in an honest and transparent pitch to farmers.
“All it required was trusting and believing these people had the autonomy to be able to make their own decisions,” Shefner said. “Present them with the offer and they can say ‘yes’ or ‘no’ themselves.”