Venture capital firm Equator, which focuses on Sub-Saharan Africa, has announced the initial close of its maiden funding of around $40 million to invest into early stage startups working on carbon emission reduction and climate resilience.
This Fund will support Seed and Series A-stage, tech-enabled ventures in the energy, agriculture and mobility sectors through an overlooked phase in their funding journey – to address the gap in start-up support between the initial burst of pre-seed funding and the eventual capital from larger, later-stage investors.
Equator will leverage support from Factor[e] Ventures, an organisation of venture builders and pre-seed investors. Equator is a venture capital firm with teams in Nairobi, Lagos, London and Colorado which is partnered with British International Investments, the Global Energy Alliance for People and Planet, Shell Foundation and DOEN Participaties.
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Building climate resilience in Africa through energy access
Then, from the other side of the pond, the US International Development Finance Corporation has made a $25m equity investment into pan-African venture capital firm Novastar Ventures’ People + Planet Fund. This also means funding for entrepreneurs with the capability to build and scale solutions to address climate change and support agriculture and climate resilience across Sub-Saharan Africa.
Novastar’ two previous funds financed tech-enabled have financed tech-enabled startups to service the agriculture, education, off-grid renewable energy, e-commerce, health and fintech sectors, amongst others.
Funding for SMEs in South Africa
In South Africa, ABSA bank will provide up to R50 million in energy subsidies under its Green Asset Finance programme for qualifying SMEs. The subsidy is for much-needed support for small business, albeit those banking with AMBSA, to finance solar installations and keep the lights on during loadshedding.
Subsidy amounts are based on clearly set out factors and can reach up to 10% of the overall installation value.
Of interest
Loadshedding hurting small business in townships and rural communities
“SMEs make a significant contribution to job creation and economic growth in South Africa. However, in many instances, the operating environment over the past few years has made it very difficult for these vital enablers to grow and thrive,” said Ronnie Mbatsane, Managing Executive for SME Business at Absa Relationship Banking.
“Loadshedding in particular continues to hamper the potential of many SMEs. Through these subsidies we are helping to put liquidity back into the hands of small businesses to power their business into full production.”
Enlit Africa invites you to join the conversation on 28-30 May 2024 in Cape Town, South Africa.
