Press Release
Agrolend raised R$ 145 millions in a Series B round lead by Lightrock. The round will strengthen Agro/end’s capital as the company seeks to build a profitable R$2 billion loan book targeting small/medium-sized farmers.
Sao Paulo, November 3rd, 2022 – Agrolend announced today a new funding round (Series B) of R$145 million, led by Lightrock, a global private equity manager with an impact focus that already invested in companies like Creditas, Dock, Frete.com, Buser, Dr. Consulta, Cortex and Konfio.
In the Series B round, the company also added new important equity investors, such as Yara Growth Ventures (the venture investment team of Yara, a global leader in crop nutrition), Mago Capital (fund that has the founders of Locaweb as partners), among others. Additionally, the round was followed by all the existing institutional investors: Valor Capital, Continental Grain Company, SP Ventures, Provence Capital and Barn Invest.
Agrolend increased its equity (tier 1 capital) to R$220 million and now aims to increase its loan book to R$2 billion in the 2023/2024 crop season reaching a client base of 10 thousand small/medium-sized farmers all over Brazil. Agrolend’s loan book is expected to reach R$250 million by the end of 2022, which represents a growth of lOx when compared to the company’s loan portfolio by the end of 2021. Furthermore, Agrolend raised a new R$150 million securitization vehicle for the loans in the form of a FIAGRO (special investment fund for agribusiness related assets) that brought leading local asset managers such as ITAU AM and JGP as investors.
“Agrolend managed to bring together investors with complementary characteristics, joining competences such as growth capital with an impact focus, deep knowledge of the agribusiness sector, global presence, among others. Furthermore, those investors have long-time commitments to invest in Brazil and are willing to invest much more at Agrolend in the following years.”, according to Andre Glezer, co-founder at Agrolend.
“This is our first investment in the agribusiness sector in Latin America, and we are very excited with Agrolend’s prospects. We were attracted by a unique combination of a scalable business model that applies technology to provide credit and financial services to growers in a bureaucracy-free, agile, and profitable way.”, explains Gustavo VerdelIi, partner at Lightrock.
Digital financial institution focused in credit for farmers
Founded less than two years ago by Andre Glezer {CEO), Alan Glezer {CFO), Valeria Bonadio (CCO), Leopoldo Vettor (CTO) and Carlos Fagundes {Head of Sales), Agrolend is focused in supporting millions of Brazilians farmers in the pursuit of the leadership in the global growth of food production. Supported by its 100% digital cloud-native platform, Agrolend offers high scalability to serve this important and massive public in Brazil.
Agrolend offers to farmers an easy, fast and bureaucracy-free credit, with the resources being used to buy agribusiness inputs such as seeds and fertilizers. Loans are formalized in a 100% digital manner using the grower’s Whatsapp, and the capital becomes available within very few days. Agrolend has a vast network of more than 100 partners, the majority of those are agribusiness input retailers and industries, and the credit is offered directly at the point of sale what makes the life of the farmer much easier.
Outlook for the 2023/24 crop season
Before the conclusion of the new funding round {Series B), Agrolend already had a strong cash position of R$75 million and was operating at breakeven. Once approved by the Brazilian Central Bank, Agrolend will operate as a “Sociedade de Credito, Financiamento e lnvestimento” {SCFI) and expects to reach a ROE (return on equity) above 25% for the 2023/24 crop season. Leverage is expected to remain at a comfortable level, and the capital tier 1 ratio should remain close to 18%.
Agrolend expects to fund the loans in the 2023/24 crop season by issuing time deposits known as LCA (“Letra de Credito do Agroneg6cio” – special deposit to fund the agribusiness sector) that will be distributed in investing platforms such as XP lnvestimentos (brokered deposits). This kind of time deposit is very attractive for the retail investors given its main characteristics: income tax-free for the individual investor and guaranteed by the FGC (“Fundo Garantidor de Credito” – Brazilian equivalent to the FDIC in the US) up to R$250 thousand per individual investor.
Offering a unique combination of growth and profitability for a digital bank, Agrolend aims to reach a leading position in the agribusiness sector. Taking into account this is a market with more than 1 million small/medium-sized farmers and more than R$500 billion in outstanding credit, the founders believe that Agrolend could reach 50 thousand clients and expand the loan book to R$10 billion. Given the strength of the agribusiness and the lack of publicly listed companies for the sector, there is a soaring interest among investors at Agrolend given that it also operates in the junction of three important pillars of the country: agribusiness, technology, and financial services.
“The agribusiness sector represents around one third of the Brazilian GDP and offers more growth and resilience than other sectors. Farmers are currently very profitable and we expect a strong expansion of credit in the sector in the coming years. Agrolend and the private banks will be in a favorable position to meet those needs. Nevertheless, small/medium-sized farmers are not properly served by the incumbent private banks and, for this niche, Agrolend will make an important difference”, explains Alan Glezer, co-founder of Agrolend.
About Agro/end
Agro/end is a financial institution that was born to revolutionize the agribusiness market for small and medium-sized farmers in Brazil, by granting fast, easy and bureaucracy-free credit. The company operates through partnerships with industries and distributors of ag inputs, equipment, and farm implements, and also works with agtechs in the financing of technology. Farmers have access to credit through an electronic platform and operations are originated and formalized in a totally digital environment, just using the smartphone. Agro/end is present in more than 10 Brazilian states and in several segments such as soybeans, corn, coffee, sugar cane, fruits, livestock and dairy cattle. Agro/end SCD S.A. is a “Sociedade de Credito Direto”, authorized by the Central Bank of Brazil, pursuant to BCB Resolution No. 4,656, dated April 26, 2018.
About Lightrock
Lightrock is a global private equity platform that backs purpose-driven entrepreneurs tackling the world’s biggest challenges. Since 2009, Lightrock invests in companies that pursue scalable and tech-driven business models around the key impact themes of people, planet, and productivity/tech for good. Lightrock’s portfolio includes more than 85 high-growth companies in 14 countries across Europe, the USA, Latin America, Asia and Africa, supported by a diverse team of over 90 professionals based in 5 offices across these regions, including Lightrock’s headquarter in London, having more than USO 3bn in AuM. With presence in Latin America since 2017, Lightrock has already invested USO 600M in 12 companies, such as Creditas, Dr. Consulta, Dock, Konfio, Buser, Tu/, amongst others, via 2 different funds.
Site: https://www.lightrock.com
Linkedin: https://www.linkedin.com/company/lightrock-latam
Assessoria de imprensa LightRock LatAm / Analitica Comunica ao [email protected]
Wilma Loures – [email protected] +55 11 96324-6565
Mauricio Esposito – [email protected] +55 1199915-7583
Erica Benute – [email protected] +55 1199185-7078
