Acumen, a non-profit global venture fund together with East Africa-focused investment firm, Novastar Ventures, Friday announced a €2 million ($2.5 million) equity investment in a Uganda-based company.
The company, SolarNow, that sells modular high quality solar home systems to rural populations across the country does not only sells solar home systems, it also provides a financing solution that allows customers to pay for the system for a period of 18 months.
“This investment in SolarNow presents us with an opportunity to make a difference in the lives of individuals and families who are currently without access to electricity,” said Duncan Onyango, East Africa Director at Acumen.
According to Onyango, “SolarNow’s innovative solution coupled with accessible asset finance aligns well with Acumen’s mission of changing the way the world tackles poverty by making critical goods and services accessible to underserved low income communities.”
There are over 25 million Ugandans, 85 percent of the population, without access to electricity, according to the International Energy Agency. SolarNow is aiming to impact over 3 million lives in Uganda by 2017 through the sale of its systems, with plans to expand across Tanzania and Kenya in the near future.
With this investment, SolarNow will focus on fulfilling the growing demands of its existing clients, expand to new franchises in under-served areas of the country, and prepare for expansion into Kenya and Tanzania in the medium term.
“We are impressed by SolarNow’s well developed distribution network as well as the quality of equipment and service they provide. They raise the bar for low-income customers in terms of affordability, reliability and service guarantees,” said Andrew Carruthers of Novastar Ventures.
“We see Novastar and Acumen’s support as a great acknowledgment of our business
model,” said Willem Nolens, CEO of SolarNow. “We’re not just a solar product company or a pay-as-you-go service provider; we see ourselves as an asset finance and distribution company with a focus on renewable energy, and bringing together affordability and distribution with great products is what justifies this trust.”
Acumen has invested over $30 million across East Africa since 2007, focusing on a wide range of sustainable, scalable businesses—in agriculture, housing, health, water and energy—that use market-based approaches to deliver products and services to millions of low income people from both rural and urban communities. Acumen’s recent investments in the region include Miliki Afya, a low cost high quality healthcare provider in Kenya,
Mekelle Farms, Ethiopia’s largest producer of day old chicks, as well as KZ Noir, a specialty coffee producer that sources its coffee from over 10,000 smallholder coffee farmers in Rwanda.