Investor Insights: Norfund Supports Kenya's Crossboundary with $40m in Fundraising

Norfund backs Kenya’s Crossboundary in $40m fundraising

Highlights

• CrossBoundary Energy Access (CBEA), a Kenyan firm that finances and installs clean energy systems for commercial and industrial (C&I) customers, is getting $40 million in new funding commitments from the Norwegian Investment Fund for Developing Countries (NORFUND).
• This funding comes after a recent $25 million backing CBEA received from ARCH Emerging Markets Partners Limited, Bank of America, and Microsoft Climate Innovation Fund in June.
• CBEA plans to deploy a total of $150 million over the next two years to bring clean energy to one million people in Africa.

Source: Afrik21

Our Takeaway

As African economies grow, the demand for energy by companies, homeowners, and industries increases by the day. This comes with challenges of climate change and energy depletion, however, many innovators and investors believe renewable energy can help Africa counter these challenges. Financiers mostly are skeptical about funding ventures in the renewable energy space, which has hindered growth in the sector, but recent successful fundraising rounds by Kenyan duo Crossboundary and Sun King suggest the perception toward the renewable energy opportunity in Africa could be changing.

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Sudanese fintech Bloom raises $6.5m from YC, Visa and others

Highlights

• Bloom, a Sudan-based fintech that offers a high-yield savings account and adjacent digital banking services, has raised a $6.5 million seed round. This investment is coming after the startup’s undisclosed pre-seed round last year.
• This financing welcomed participation from fintech giant Visa, Y Combinator, U.S.-based VCs Global Founders Capital (GFC) and Goodwater Capital and UAE-based early-stage firm VentureSouq. 
• In March, the Sudanese- and Dubai-based startup announced that it was a part of Y Combinator’s winter batch this year after launching from stealth that same month. This funding will help execute its expansion plan across the Anglo-East African.

Source: TechCrunch

Our Takeaway

The Middle East and North Africa (MENA) region has a population of 370 million, 62% of which have smartphones, 50% aged between 14-45 years old, and amasses $500 billion in annual savings. Platforms like Bloom and Egypt-based Thndr tap into this market to help their population protect wealth from their respective volatile currencies. YC’s backing of Bloom is also a significant win for the ecosystem, which only recently received its first foreign venture capital investment since international sanctions on the country were lifted in 2020, following a 30-year isolation period.

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Moove closes $20m financing round from South Africa’s Absa

Highlights

• Moove, an Africa-focused mobility fintech, secured a financing facility of $20 million from Absa Corporate and Investment Banking, making this the first bank relationship for the two-year old company.
• Since first launching in South Africa during Q4 2021, Moove has experienced rapid growth, and this latest funding will enable the company to strengthen its product offering and create more jobs.
• Moove provides revenue-based vehicle financing to mobility entrepreneurs and is democratizing access to vehicle ownership, creating employment opportunities to empower those previously excluded from financial services.

Source: Moove

Our Takeaway
In Africa, the market opportunity for vehicle financing is huge. Despite having a population of more than 1 billion people, 43% of them urban dwellers, the continent recorded less than 1 million total new vehicle sales in 2019, a far cry in comparison to 17 million in the U.S. alone. Moove currently operates in six cities across Nigeria, Ghana, South Africa, and Kenya, with plans to expand further across the continent and globally after raising $10 million in debt funding in February, $105 million in a Series A2 round consisting of equity and debt in March, $20 million debt from BII earlier this month and the latest facility from Absa, which brings the total funding raised by the startup to over $200 million.