Victory Farms, an aquaculture startup and tilapia fish farming with hatcheries, nursery ponds, and deep-water cages, has recently raised $5 million in new funding led by Ed Brakeman, a senior managing director at Bain Capital, and Hans den Bieman, founder and ex-CEO of Mowi, one of the largest salmon businesses globally.
This is the startup’s first institutional investment after several internal angel rounds from the same set of equity–and debt investors. This funding will allow the Kenyan-based company to expand its business into Rwanda, DRC, and Tanzania.
Rebuilding The Fish Value Chain in Kenya
In 2015, Joseph Rehmann teamed up with his longtime business partner Steve Moran to explore Lake Victoria and perform some feasibility studies on how they could use technology to disrupt the country’s cold chain markets.
The average Kenyan consumes only 10-20% of animal protein, most of which is red meat. With a large fish deficit and retail prices as high as $5 per kilo. They discovered a unique opportunity to rebuild the fish value chain from scratch and launched Victory Farm in mid-2016 to serve a market with about a $1.5 billion fish deficit.
Further narrating his journey to starting the company, Rehmann revealed that after completing his MBA program, he got to work on a three-month aquacultural project in Ghana, which ultimately led to a three-year role where he became CFO of an Accra-based farm.
“I learned a lot about aquaculture scaling and all that. I believed the platform I was running could be a lot bigger and scale a lot faster if we could connect more dots — and basically create an end-to-end protein plant,” said Rehmann, who has also worked for an investment bank and Microsoft.
About Victory Farm
Victory Farm says it is an aquaculture tech-enabled fish farming using technology to grow more fish while simultaneously lowering costs for the thousands of market women who buy fish in small batches to cook and sell at local food markets.
“We run a tech-enabled platform and have scaled 2x faster than any African fish company. And using data, we have built the most efficient operation globally at half the CAPEX of current global leader,” Rehmann says. “We sell to mass market Africans via a high innovative RTM cold chain which uses predictive data to push fish to thousands of market ladies every day all across Kenya with less than 1% spoilage.”
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According to Rehmann, the company has over 54 retail outlets where over 15,000 market women go to buy fish, and they don’t need electricity or ice.
“We use vertical integration to drive a more robust data set from end to end,” he said. “This allows us to innovate and create more cost-effective solutions through our systems and the power of data to deliver a better, fresher product to more consumers.”
Becoming World’s Largest Tilapia Platform
Because of its technology, Victory Farms claims to have one of the highest margin structures in the fishing industry. Between 2017 and 2021, the company recorded a 130% CAGR. Maintaining this growth rate can exude confidence. In the case of Victory Farms, Rehmann feels the company — which also has a processing plant and distribution network — has no significant competitors in Kenya or the East African region at large.
“We’re growing so much faster than them (the competition) that we don’t see this as a competitive playing field. The real competitor for us is hunger and consumers not being able to have an affordable protein option,” he said.
However, Rehmaan sees Zurich-based Regal Springs as a more significant player on a global scale. If its expansion into new geographies goes as planned, Victory Farms might exceed Regal Springs in the next five years to become “the largest end-to-end tilapia platform” globally, the CEO affirms.
As much as Victory Farms is focused on profit and expansion, Rehmann said it’s also important to note that the company is working to become the world’s most sustainable tilapia platform.
