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Krakakoa

Krakakoa improves livelihoods of smallholder cocoa farmers by providing training, paying premium prices, and managing an integrated value chain.

Facts

Investee Krakakoa (formerly Kakoa), founded 2013
Location Indonesia
Sector Agriculture
Funding start 2015
Funding type Grant; debt

 

Impact

Context

Indonesia is the world’s third largest cocoa producer and its 1.6 million small-scale cocoa farmers earn on average less than USD 110 per month. The spread of cocoa diseases and a lack of knowledge relating to improved agricultural practices cause yields to remain low. The majority of cocoa grown in Indonesia is not fermented, and therefore of a lower quality – this demonstrates the average cocoa farmer’s separation from value adding activities along the supply chain. Price instability creates a disincentive for cocoa farmers to invest time, energy, and money into improving cocoa quality.

Solution

  • Krakakoa is a “bean to bar” chocolate maker that manages the entire value chain by investing in farmers ‘development, sourcing directly from smallholder cocoa farmers, and producing fine chocolate -100% made in Indonesia
  • Krakakoa guarantees farmers high price premiums (up to 200% more than current prices) by supporting them to produce the high quality beans required to make a premium product

Impact depth

Farmers partnering with Krakakoa can triple their income through a combination of yield improvement and a high premium price paid for their quality production. Krakakoa improves bean quality by enforcing sustainable agricultural practices among its supplying farmers, guaranteeing a market and preserving natural ecosystems.

Krakakoa helps:

  • Increase household income: Creates more stable and additional revenue (tripled) for small-scale cocoa growers
  • Create long term sustainability: Promotes sustainable farming practices and reduces exposure to harmful chemical fertilizers and pesticides
  • Foster social cohesion: Prevents rural exodus by creating economic development in rural areas
Impact Reach 2014 2015 2016 2017
# of farmers trained
and experiencing
an increase in revenue
(cumulative)
60 82 173 831
% avg. incremental income p.a. n/a 3 29 74
# of hectares of land under
sustainable farming practices
(cumulative)
90 n/a 158 n/a

SDGs

By investing in Krakakoa, we align with and contribute to six of the United Nations’ Sustainable Development Goals.

"I think the big difference is that LGT VP ranks impact first. Other companies have a limit and say “ok we are aiming at 20+2” and that is what we hear all the time that we have to do. We then do the math and wonder how we could do 20+2 given the nature of our work? The thing that I think is great about LGT VP is that you [LGT VP] have different people in different places who are there to fulfill different needs."

Sabrina Mustopo, Founder, Krakakoa