The Trump administration’s abrupt freeze on foreign aid has sent shockwaves across the nonprofit and development sectors, with significant consequences for startups reliant on USAID funding. Among the hardest hit is OKO, an African insurtech company specializing in climate insurance solutions for farmers. The company, which has weathered crises like the COVID-19 pandemic and the conflict in Israel, now faces what could be its most significant challenge yet.
Last week, the U.S. Secretary of State enacted a suspension of all foreign aid, pursuant to an executive order from President Donald Trump. USAID, the American agency responsible for international development, has since issued Stop Work orders for all active contracts, grants, and cooperative agreements. The freeze has upended OKO’s plans, jeopardizing projects critical to their mission of providing affordable insurance to underserved communities in sub-Saharan Africa.
A Sudden Halt to Growth
OKO’s troubles began when USAID halted their flagship initiative in Ivory Coast, which aimed to develop new climate insurance products for smallholder farmers. Signed just last year, the project had been progressing well and was poised to make a tangible impact on agricultural resilience in the region. In addition, OKO had recently received approval for its largest-ever project with USAID and was in the final stages of negotiations for another sizable contract. Both initiatives are now indefinitely suspended.
“We survived COVID-19, we survived the war in Israel, but we might not survive Donald Trump,” said Simon Schwall, co-founder and CEO of OKO.
USAID has historically been a cornerstone of OKO’s operations, with the agency accounting for a significant share of the company’s 2025 revenue pipeline. The abrupt cessation of funding has created a crisis of liquidity and raised questions about OKO’s immediate future. Yet, amidst the turmoil, the company sees a potential silver lining.
Despite the setbacks, OKO’s leadership remains cautiously optimistic. The company’s shelved projects are fully developed, with detailed budgets, timelines, and partnership agreements in place. These projects could be transferred to other funding bodies or development agencies willing to step in.
“The fact that these initiatives were awarded to OKO in the first place validates the value we provide and the traction we’ve gained in the market,” the spokesperson noted. OKO is actively seeking new investors and lenders, offering attractive terms to those willing to support its vision. The company’s goal is not merely survival but to emerge with a more diversified client base and stronger financial footing.
“If you wish to support us in this challenging times please reach out to me,” Schwall added.
OKO, a Bamako-based digital insurance startup, has been making significant strides in addressing the challenges faced by smallholder farmers. Founded in 2017, the company offers mobile-based crop insurance products, providing farmers with financial security amid volatile climate trends. Operating in Mali and Uganda, OKO has insured more than 15,000 farmers to date.
In 2021, OKO saw a sixfold increase in its number of paying clients compared to the previous year. This growth enabled the company to expand its reach in 2022 by covering additional crops and forming new agreements with financial institutions that provide agricultural loans to insured farmers.
The startup recently raised $500,000 in an extension round to fund its expansion into Ivory Coast. Existing partners such as Orange, Allianz, and Touton are playing pivotal roles in this initiative. The funding round included participation from global impact-tech accelerator Katapult and three business angels: Guillaume Leenhardt (CEO of Gentle Finance), Henry Allard (CEO of Filhet-Allard Maritime), and Lionel Dorie (founding partner of Augusta Energy Group). This builds on a $1.2 million seed investment secured by OKO in April 2021.
“Ivory Coast has always been a priority market for us, so when we saw the opportunity to launch OKO there this year we jumped on it. We are bringing strong partners to make this expansion a success and we have big ambitions for the months to come,” said Simon Schwall, Co-founder and CEO of OKO.
Political and Legal Fallout
OKO’s predicament underscores the broader ramifications of the Trump administration’s freeze on federal financial assistance. A two-page memo from the Office of Management and Budget (OMB), obtained by Politico, directs all federal agencies to “temporarily” halt disbursements under the new executive order. The freeze affects a wide range of programs, from domestic infrastructure projects to international development initiatives. Notably, exceptions are limited to Social Security and Medicare payments.
The memo argues that federal funds should not support “Marxist equity, transgenderism, and Green New Deal social engineering policies,” a rationale that has drawn sharp criticism from across the political spectrum. Senate Minority Leader Chuck Schumer decried the move as “more lawlessness and chaos” and called on the administration to reverse course. “Congress approved these investments, and they are not optional; they are the law,” Schumer said.
Legal experts have also raised alarms. Bobby Kogan, a former official at the White House budget office, called the freeze a “big, broad, illegal” violation of impoundment laws, which prohibit presidents from withholding funds appropriated by Congress. Diane Yentel, president of the National Council of Nonprofits, warned that the order could “decimate thousands of organizations and leave neighbors without the services they need.”
What Lies Ahead for OKO
For OKO, the coming months will be critical. The company must navigate the immediate challenges posed by the funding freeze while exploring alternative sources of capital. Beyond financial resilience, OKO’s ability to maintain trust among its stakeholders — from smallholder farmers to potential investors — will be key.
“This is a challenging time for us, but it’s also an opportunity to prove our resilience and adaptability,” the spokesperson said. “We believe in the value of our work and are determined to see it through.”
OKO’s story reflects the precarious position of many organizations caught in the crossfire of shifting U.S. policy priorities. As the Trump administration’s freeze continues to ripple across sectors, the long-term impact on global development and innovation remains uncertain. For now, OKO’s battle for survival is emblematic of a broader struggle to sustain progress in the face of political upheaval.