E Squared Funds Agribusiness With A Strong Focus On Food Security
E Squared Funds Agribusiness With A Strong Focus On Food Security. In December 2022, impact investor E Squared Investments participated in a follow-on funding round with Nambu Group, an insect protein company founded by Allan Gray Fellow Founder, Lowell Scarr, that converts food waste into high-value protein feed for the poultry, pork, fish farming industries as well as the exotic pets market based in the Eastern Cape.
By 2050, the global population is projected to reach 10 billion people. Current food production systems will be unable to meet the growing demand and protein scarcity is a concern. Traditional protein sources such as soy and fishmeal may not be able to meet the growing demand. Insect protein offers a versatile and sustainable solution. Lowell embarked on his Nambu journey ultimately to solve for the problem of food security for humans. He believes that soon we will need to be ready to face the huge environmental, economic and food security challenges head-on. Although human consumption of insects has not received widespread adoption in the West, there are currently over two billion people in the world consuming insects as part of their diets.
Furthermore, insect protein is nutritionally superior to traditional protein sources and will have long-term cost benefits. Global demand for alternative proteins and oils is projected to reach 500,000 metric tons by 2030, primarily driven by the pet food and aquafeed markets. The insect protein market is forecast to reach $4.6 billion by 2027, driven by initiatives to reduce greenhouse gas emissions and increased awareness of sustainable food sources.
Tshilidzi Matlala, E Squared’s Chief Portfolio Officer is excited about the opportunity to continue creating value in Lowell’s business, and says, “We are excited to augment our Nambu partnership for this next phase of the growing venture. Expansion at this stage makes a lot of business sense and we are confident of Lowell’s ability to take Nambu to the next level whilst remaining committed to his vision.” Nambu has been in the E Squared Ventures portfolio since 2020 and this seed round investment will be used to upgrade and expand their Black Soldier Fly (BSF) production facilities, improving product sales revenues and increasing the sustainability of the business.
Nambu currently employs 23 people in a province that is renowned for having the country’s highest unemployment rate, sitting at 45.8% going into the third quarter of 2022 (Statistics South Africa). This deal and the subsequent expansion will mean almost doubling Nambu’s staff commitment this year. This alone makes the deal worthwhile for E Squared, which pays attention to the social impact of their investments and long-term commitment to responsible entrepreneurship. “We have built a business that is highly appropriate for the South African context which is at the root of our sustainability and success. Going into the new year with additional E Squared funding means that we can crystalise some promising engagements and expand without compromising our supply of high-quality feed or negatively affecting existing relationships and commitments. It also means that we can undertake R&D on further product offerings and process significantly more waste as part of our expanded waste management service,” says Founder and CEO, Lowell Scarr.
Nambu is making a significant impact in the food industry by unlocking the potential of insect proteins and alternative oils. This year, Nambu will take significant strides in expanding their circular system and positively impacting the entire food value chain. By offering a sustainable recycling service for businesses, Nambu addresses the pressing issue of food waste disposal at landfills and provides innovative solutions for recycling beyond composting.
