Equator Raises USD 55 M To Back Early-Stage African Climate Tech Startups

African venture capital firm Equator has closed a USD 55 M fund to support early-stage climate tech startups, addressing a critical funding gap in the region. While climate startups in developed markets often receive government subsidies, African founders must rely on development finance institutions (DFIs), foundations, and endowments, making them vulnerable to shifts in global capital flows.

Equator aims to change this dynamic by investing in scalable solutions that can attract private capital. The fund will back 15 to 18 startups, writing USD 750 K to USD 1 M checks at Seed stage and USD 2 M at Series A, while reserving capital for follow-on rounds. The firm will also support startups in unit economics, governance, and regional expansion.

Despite its goal of reducing reliance on aid, Equator’s own limited partners (LPs) include DFIs like British International Investment (BII), Proparco, and IFC, as well as foundations like IKEA-funded Global Energy Alliance and the Shell Foundation. Still, the firm sees itself as a bridge, bringing global private capital into African climate tech.

With Africa accounting for less than 3% of global CO2 emissions but facing severe climate impacts, Equator is backing startups in energy, agriculture, and mobility that deliver economic value alongside sustainability. Managing Partner Nijhad Jamal notes that the industry focus has shifted from impact narratives to unit economics and monetisation, with startups now expected to prove clear financial value to customers.

As the climate tech sector matures, M&A activity is increasing, with exits expected at USD 100 M rather than billion-dollar IPOs. Equator has already seen portfolio companies Roam Electric, Ibisa, and Leta gain traction, and it anticipates further commercial exits as capital structuring improves.