We first utilised market data to model the gap between domestic production and demand across beef, goat, and lamb, as well as analysing gross margins across different domestic (e.g. high end and mass consumption) and export markets. Our team then held over 20 consultations with players across the livestock value chain, including ranches, slaughterhouses, feed producers, exporters, and retailers to identify financing gaps.
Our final report identified potential areas which Gatsby could finance, either directly or by utilising blended finance tools to catalyse other sources of commercial and concessional capital. These included finance for processors to establish finishing and fattening facilities, as well as a range of export financing products for Kenyan goat and beef exporters. We also identified earlier stage opportunities (e.g. in commercial fodder) which require grants to test new models and approaches.
Phase 2: Following the initial feasibility study Wellspring supported Gatsby’s livestock team in building a potential transaction pipeline of investment opportunities in the sector linked to processors, traders and aggregators who may have active plans on backward integration into fattening or finishing feedlots to underpin their supply-chain.
Wellspring put together a detailed pipeline of potential transactions in the livestock sector including structure, key investment thesis, risk & mitigants, potential TA opportunities and next steps. This provided a pathway for Gatsby to execute potential transactions and priotorization of partners in the sector.