Verqor raises US$7.5 million to digitalize Mexico’s agricultural sector

Press release by Accion Venture Lab

Mexico City, Mexico, October 31, 2023 — Verqor, a fintech startup digitalizing Mexico’s agricultural sector, has raised US$7.5 million, including US$4 million in a pre-Series A round led by Yara Growth Ventures. Accion Venture Lab, SP Ventures, Glocal, and Amplifica Capital also participated in the round. The company also raised an additional US$3.5 million in debt funding from Co_Capital, Addem Capital.

Verqor provides cashless credits to farmers to purchase the inputs they need to grow their crops, like fertilizers, agrochemicals, and organic products, with 55% of users accessing credit for the first time. At the end of the crop cycle, farmers repay the credit with their produce sales. Verqor’s financing allows farmers to cover up to 90% of their costs, improving produce quality and increasing their incomes every cycle. Verqor is working to make credit accessible to every farmer in Mexico using a unique underwriting process adapted to the specific characteristics of the sector. It is a pioneer in evaluating the real paying capacity of a farmer using productive data, including normalized difference vegetation index (NDVI) factors, supply chain trends, weather trends, yield information, and produce price fluctuation, for assessing credit viability.

Mexico is one of the world’s top ten food producers, yet more than 90% of farmers lack access to formal financing, limiting their opportunities to invest in their fields. While farmers in other major economies in the region, such as Brazil and Argentina, can often access credit through input retailers and other alternative sources, farmers in Mexico often lack these options due to a more fragmented value chain and a lack of digitization. Without high-quality inputs, farmers face decreases in productivity and margins, threatening to impact food supplies in Latin America and globally.

This round of funding will enable Verqor to expand its operations in Mexico and create the largest network of partnerships of agricultural suppliers in the country, becoming a payment method for their clients. Mexico’s agricultural industry is highly fragmented, and Verqor’s platform bridges the gaps between suppliers, farmers, and produce buyers. Verqor is also further developing its technology to make its credit approval process seven times faster than traditional financing options, reshaping the way traditional agribusiness is done in Mexico.

“Mexico’s farmers play a crucial role in the global food supply chain, yet they lack access to the financial resources they need to produce high-quality crops. With this new funding, Verqor will be able to scale nationally and empower even more farmers in Mexico,” said Verqor CEO Hugo Garduño.

“The Verqor team have consistently impressed us with their ability to understand their farmer customers and execute on their vision of making farmer’s lives easier,” said George Roche,Investment Director at Yara Growth Ventures. “We are very proud to invest in Verqor and help them on their path to changing agriculture in Mexico and beyond.”

“At Accion Venture Lab, we have seen how the global financial system continues to leave out farmers, preventing them from accessing the financing and high-quality inputs needed to grow their crops. Verqor is creating a digital ecosystem that connects key agricultural players in Mexico while placing the needs of farmers at its core. The data collected through digitizing the agricultural supply chains enables Verqor to unlock access to formalized credit for small –and medium-sized farmers in the country, helping them become more productive and grow with each crop cycle,” said Amee Parbhoo, Managing Partner of Accion Venture Lab.

“Verqor is using technology to democratize credit access in Mexico, a vital player in global food production. By granting small and medium-sized producers access to better inputs and enhancing their productivity, we contribute significantly to combating climate change. At SP Ventures, we recognize the importance of Verqor’s technology in enhancing small-scale producers’ resilience against climate change and encouraging the adoption of regenerative agriculture.” said Juliana De Podestá, Head of ESG and Impact at SP Ventures.

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About Verqor

Verqor is a Mexican agri-fintech founded in 2018. Verqor offers cashless credits to farmers under the model: get agri-inputs and pay back with crops. With this credit, Verqor connects the players of agribusiness: farmers, agri-input suppliers, and produce buyers. Verqor offers traceability on the supply chain and access to capital to producers, an underserved but highly productive market.

About Yara Growth Ventures

Yara Growth Ventures is the corporate venture capital team for Yara International ASA (a world-leading crop nutrition and agriculture company headquartered in Norway). The team invests in startups and venture capital funds, which sit at the intersection of science and technology in the food and agriculture industry. At Yara, the mission is to responsibly feed the world and protect the planet. At Yara Growth Ventures, we don’t lose sight of that. We are patient capital who, while always looking to make financially sound investments, invest in teams making a dent in agriculture.

About Accion Venture Lab

Accion Venture Lab is a seed-stage investor that provides capital and extensive support to innovative fintech startups that improve the reach, quality, and affordability of financial services for underserved people and have the potential to scale. Venture Lab has invested in more than 65 early-stage startups that operate in 30 countries worldwide. Venture Lab is a part of Accion, a global nonprofit committed to creating a fair and inclusive economy, with a pioneering legacy in microfinance and fintech impact investing. Accion catalyzes financial service providers to deliver high-quality, affordable solutions at scale for the 1.8 billion people who are left out of – or poorly served by – the financial sector. For 60 years, Accion has helped tens of millions of people through our work with more than 200 partners in 63 countries. For further information, visit www.accion.org/venturelab.

About SP Ventures

Founded in 2010, SP Ventures is a Brazilian venture capital fund manager specializing in sustainable agriculture and food innovation in Latin America, with a proven track record of delivering financial returns to its investors and environmental, social, and economic impact to its end-beneficiaries. SP Ventures’ latest fund, AgVentures Fund II, has reached a combined total closing of approximately USD 58 million, attracting investors such as the International Finance Corporation (IFC), the Inter-American Development Bank (IDB), and the Global Environment Facility (GEF). SP Ventures has already invested in over 30 innovative, high-growth companies in Brazil, Argentina, and Mexico and is actively seeking disruptive enterprises that can add value in the highly competitive sectors of agribusiness and food. Beyond financial returns, SP Ventures is dedicated to creating a more sustainable and climate-resilient agribusiness.