A Look At Renewable Energy Startups Funding in Africa from 2018-2021
According to the International Energy Agency, 770 million people lack electricity in Africa, of which 75 percent of these live in Sub-Saharan Africa. By 2030, 50 percent of the global population without electricity will be concentrated in just 7 countries: DRC, Nigeria, Uganda, Tanzania and Niger with Pakistan being the only one outside Africa.
Many renewable energy startups (cleantech startups) have sprouted across the continent to bring affordable electricity to off-grid and low-income communities. Investors have also backed them. Between 2018- 2021, cleantech startups have raised a total of USD 803 Mn across 124 deals which is an average of USD 6.5 Mn per deal.
Seed rounds (24) were the most common deals followed by Equity (17) and Debt deals(15). Grants (14) and Series A (10) were the only other funding rounds that cracked double figures.
But in terms of money raised, Equity deals took the largest share with USD 139 Mn, followed by Debt rounds with USD 132 Mn and Seed Rounds (USD 120 Mn). Series D had just two deals but were worth USD 105 Mn while the 10 Series A managed to fetch USD 100 Mn.
Tanzania received the most funding ( USD 190 Mn) from just 4 deals. Kenya came second, collecting USD 151 Mn from 20 deals and Nigeria came in third with USD 147 Mn raised from 46 deals.
The Most Funded Cleantech Startups In Africa
The 10 most funded cleantech startups in Africa have raised a combined USD 595.5 Mn USD which accounts for 74 percent of all funding. 3 startups are from Tanzania (Zola Electric, OffGrid Electric and KopaGAS), 2 from Nigeria ( Daystar Power and Rensource), and a solitary startup from Mauritius (Escotel) and Ghana (PEG Africa).
Three startups; D.Light (USA), BBOXX (UK) and Africa Highview Power (USA) are headquartered outside Africa, but have operations here.
- Zola Electric ( USD 110 Mn)
Launched in 2011 by Erica Mackey, Xavier Helgesen and Joshua Pierce, Zola Electric provides solar home solutions to off-grid rural communities in Tanzania. It raised USD 90 Mn in September 2021 to scale its technology and enter new markets. This funding took its total raised so far to USD 110 Mn making it the most funded cleantech startup in Africa.
2. D.light ( USD 109 Mn)
D.Light makes a suite of solar home systems that power millions of homes and businesses. These products include solar lanterns, panels, TVs, bulbs and radios. D.light has raised USD 109 Mn across two funding rounds.
3. BBOXX ( USD 81 Mn)
BBOXX provides pay-as-you-go solar home systems. Under this model, customers only pay for what they use. BBOXX has operations in Kenya, Rwanda, Togo and DRC. It started operations in Nigeria after raising a USD 50 Mn Series D in August 2019.
4. Africa Highview Power (USD 70 Mn)
Africa Highview Power is a startup that specializes in electrical storage. It raised a USD 70 Mn seed round in February 2021 to distribute its solutions in Africa. Investors in this round included Janus Capital, Sumitomo Heavy Industries and Spanish Group TSk
5. Daystar Power ( USD 58 Mn)
Daystar Power is a hybrid renewable energy provider that was founded in 2017. It has operations in Nigeria, Senegal, Ghana and Togo. In July 2021, it raised USD 20 Mn from the International Finance Corporation after raising USD 38 Mn in January from the same organisation.
6. OffGrid Electric ( USD 50 Mn)
OffGrid Electric is a cleantech startup that provides small containers with solar panels on top and a water purification system inside. It has been in operation in Rwanda and Tanzania since 2019. It raised USD 50 Mn from Helios Investment Partners and General Electric Venture Capital.
7. Escotel ( USD 35 Mn)
Ecotel provides power through the installation of photovoltaic solar panels that power existing and future cell phone towers. It operates in Mauritius, Sierra Leone and Liberia. It raised a USD 35 Mn Series A in December 2020 from Inspired Evolution Investment Management, Norfund and Sagemcom.
8. PEG Africa ( USD 34 Mn)
PEG Africa provides loans for pay-as-you-go power home systems and solar water irrigation to those that are not connected to the national grid. In March 2019, it received its biggest funding so far when it raised a USD 25 Mn Series C round from CDC Group, SunFunder and ResponsAbility.
9. KopaGAS ( USD 25 Mn)
The Tanzanian startup holds the technology for Liquefied Petroleum Gas (LPG) which allows consumers to buy and use the amount of gas that their money can afford. In January 2020, it received an equity investment from Circle Gas in the region of USD 25 Mn.
10. Rensource ( USD 23.5 Mn)
Founded in 2015, Rensource is a Nigerian startup that provides off-grid solar solutions in Nigeria for commercial, small and medium enterprises. It raised a USD 20 Mn Series A in December 2019 from CRE Venture Capital.
*The data used in this article for 2021 was from 1st January up to 30th November.