Solarize Africa, the pan-African energy leasing company has raised a further $10 million fund to expand its push for cleaner energy in the continent. The series B round investment was provided by French development finance institution, Proparco, together with other investors, EAV and EDFI ElectriFI, that are already part of Solarize investors.
Head of equity investments- Financial Institutions & VC, Proparco, Johan Choux said the partnership will propel African SMEs to pioneer their road toward cleaner energy.
“Solarize represents a compelling opportunity for Proparco in the off-grid sector. We are proud to support this innovative project as a first co-investment alongside a strong provider such as EAV. It should remarkably enable African SMEs to start their road towards greener energy through the provision of a decentralized renewable energy production solution,” he said.
The development offers succor to the continent’s debilitating energy sector as it will offer alternatives to the existing unreliable sources of power supply. Africa power journal, ESI said Solarize Africa is aiming to provide innovative financing solutions to industrial and commercial companies. The solution limits the upfront investment and provides manageable installment payment and short payback periods.
The CEO and co-founder of Solarize Africa, Jan-Albert Valk, said financing has been the bane of development of clean energy in Africa, even when its sectors, including the SMEs have been prepared for it.
“By addressing this critical value chain need we can help to fast-track green energy adoption. We are proud to welcome Proparco as a new investor in Solarize and we are grateful for the support we have received by EAV as our anchor investor almost since our inception, and by the confidence our existing investors EAV and Electrifi have shown by this follow-up investment,” he said
Solarize is operational in Kenya, South Africa and Rwanda, and aims to use the finances to expand its operation to other African countries.
“We are excited to continue to support the Solarize team as they grow their geographical footprint and impact across Africa. The team has continued to demonstrate their bankability with successful deployments within a short period, strategic market expansion, pipeline development and agility in handling the COVID-19 crisis,” said Paras Patel, partner at Energy Access Ventures.
Solarize’s innovative financing solution remains compelling for many commercial and industrial clients across Africa grappling with frequent outages and fluctuating costs that affect productivity,” Patel added.
Dominiek Deconinck, CIO at EDFI Management Company said the progress made so far by Solarize has encouraged further investment interest.
“Since EDFI ElectriFi’s first investment, Solarize Africa has successfully rolled out its business plan strengthening its team, commissioning its first project and expanding its pipeline through additional partnerships. Only one year later, we are delighted to back the company with additional investment. We believe Solarize is excellently positioned to realize its ambitious plans,” Deconinck said.
Meanwhile, South Africa’s pay-as-you-go (PAYG) solar energy startup, Yellow has raised $3.3 million Series A round to expand its energy distribution to over 100,000 consumers in Uganda and Malawi.
Yellow has focused on delivering electricity to rural Ugandans and Malawians, and has since it was founded in 2017, provided electricity for over 30,000 low income earners. Its PAYG model has helped consumers in the underserved places to manage their electricity bill, and it is winning the interest of more people.
The $3.3 million deal came from Platform Investment Partners (PIP), Ruby Rock Investment and former investors LBOS.
Yellow will use the funding to also expand its operation teams, and scale its off-grid energy offering. It seeks to broaden its digital distribution platform offers in consumer items and financial services.
The investors, PIP said Yellow’s combination of strong management with unique technology made them attractive investment partners.
“Platform growth seeks to invest in businesses that combine strong management teams with unique technology. In Yellow, we feel we have found this combination and have been hugely impressed by the deployment of Yellow’s Ofeefee software to solve complex problems in Malawi and Uganda. We are proud to provide capital alongside our investment partners, Ruby Rock, in order to grow Yellow into one of Africa’s leading digital retailers,” said Michael Stannard, COO of PIP.
The African continent has been winning the attention of investors in the cleaner energy ecosystem. There has been increasing input from solar energy since the 2018’s record of 1.6% power generated from renewable energy. The African Development Bank’s Africa Renewable Energy Fund (AREF), has also been providing finance across Sub-Saharan Africa for innovations geared toward renewable-energy-based power generation.