Moroccan start-up Yola Fresh secures USD 7M for expansion

MOROCCO – Yola Fresh, a Moroccan start-up that connects farmers with fruit and vegetable retailers, announced a successful pre-Series A funding round on May 30, 2024, raising USD 7 million from a consortium of foreign investors.

The investors were led by Al Mada Ventures, which included the Dutch development finance institution FMO.

This investment marks a significant milestone for the company, co-founded in 2023 by Youssef Mamou and Larbi Alaoui Belrhiti, aiming to expand its operations within Morocco and beyond.

Since its inception, Yola Fresh has been making strides in reducing the middleman in the supply chain of fresh food products, thereby lowering costs for retailers and minimizing food waste.

By connecting farmers directly with retailers, the company aims to create a more efficient and sustainable agricultural sector.

“Our goal is to strengthen the agricultural supply chain in Morocco and provide better opportunities for smallholder farmers,” said Mamou.

In the past year, Yola Fresh has steadily increased its presence across Morocco. With the new funding, the company plans to expand its team, enhance its platform, and extend its services to more cities within the country. Furthermore, Yola Fresh has set its sights on international expansion by 2026.

Morocco’s tomato dominance in EU Market

The success of Moroccan agriculture extends beyond start-ups like Yola Fresh. In 2023, Morocco captured 65% of the EU’s tomato import market, significantly impacting prices in traditional tomato-producing regions such as Almeria, Spain.

Moroccan tomato exports to the EU rose from 329,700 tons to over 539,300 tons, with 78% of these tomatoes ending up in France. This made up 98% of France’s non-EU tomato imports during this period.

The influx of Moroccan tomatoes has caused a substantial drop in prices, particularly affecting Spanish producers. Julian Rodríguez, a producer from Almeria, noted the challenges faced due to low prices since late December.

“The campaign has been complicated by these low prices, and we haven’t been able to recover,” he said. Favorable weather conditions across tomato-producing regions have led to excess production, exacerbating the issue.

European farmers have expressed frustration, claiming that non-EU countries like Morocco benefit from lower production costs due to less stringent environmental and labor standards.

This perceived unfair competition has led to protests, including road blockages and attacks on Moroccan trucks transporting vegetables.

Despite these tensions, Morocco continues to run a trade deficit with the EU, exporting low-value agricultural products while importing high-value goods. This trade imbalance, amounting to EUR 10 billion (10.9 million), underscores the complex economic relationship between Morocco and the EU.

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