Thirty Kenyan companies are at risk of closing businesses after U.S. President Donald Trump’s order to shut down the United States Agency for International Development (USAID).
These companies are among the beneficiaries of USAID’s Development Innovation Ventures (DIV).
DIV has invested over $100 million in Kenyan entrepreneurs over the past ten years to promote innovations in agriculture, healthcare, and renewable energy.
However, the funding stream is now gone, leaving many promising ventures scrambling for alternatives.
Kenya sometimes known as the “Silicon Savannah” is one of Africa’s top startup centres
The nation received approximately $638 million in venture capital funding in 2024.
More than 30 Kenyan startups have benefited from USAID grants, receiving between $500,000 and $6 million to scale their operations.
Beneficiaries of USAID DIV
For instance, Pula Advisors (which provides insurance for smallholder farmers), an insure-tech business based in Kenya, was awarded a $1.5 million USAID grant in 2023 to broaden its insurance portfolio to include smallholder farmers in Zambia and Kenya.
Maisha Meds (a medical supply distribution platform) was awarded $5.25 million to create a platform for the distribution of medical supplies.
Further, BasiGo (an electric bus company), was awarded $1.5 million by USAID to expand to Rwanda while SolarGen Technologies was awarded a $2.5 million grant to create solar-powered water purification systems.
In January 2023, USAID’s DIV granted Sanergy $100,000 to develop and expand innovative sanitation solutions in urban areas.
Similarly, DIV awarded Baisikeli Ugunduzi $100,000 during Stage 1 funding.
These companies have leveraged these funds to expand beyond Kenya’s borders.
Also Read: Relief for Employees as Trump Waives Order to Freeze Select USAID Programs
International Development Finance Corporation
Apart from the consequences of the USAID shutdown, there is growing concern regarding the potential closure of the International Development Finance Corporation (DFC).
DFC has also provided essential grants and loans to African startups.
Ilara Health received a $1 million loan from DFC in January to enhance its diagnostic platform.
Other companies like M-KOPA and Twiga Foods, have also benefited from DFC’s debt financing showing its importance to startups in Kenya.
Lack of financial support may hinder many early-stage African startups from growing or force them to shut down before proving their business models.
Also Read: Catholic Church, KU & M-Kopa Among Top USAID Beneficiaries in Kenya [List]
Trump Executive Order
Trump signed an executive order on January 20, suspending all foreign development assistance for 90 days.
He said the U.S. foreign aid industry and bureaucracy do not align with American interests and, in many cases, contradict American values.
Consequently, the United States State Department issued a directive on January 24 to reduce all aid, potentially terminating grants that are essential for such startups.
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