Energy Access Ventures rebrands to E3 Capital, announces the launch of its follow-on fund E3 Low Carbon Economy Fund I
Nairobi, 23 February 2022
- Energy Access Ventures rebrands to E3 Capital, in line with its expanding focus on technologies enabled by low carbon energy.
- E3 Capital announces the launch of E3 Low Carbon Economy Fund I to back innovative business models that are digitised, decentralised and decarbonised
E3 Capital – the Vision to Reconcile Sustainability and Growth
When ARE Member Energy Access Ventures (EAV) launched its first fund in early 2015, its aim was to provide direct access to electricity for households and small and medium enterprises (SMEs) in Sub-Saharan Africa. However, it became abundantly clear within the first few years that, in order to truly move the needle in this regard, the investment scope had to be broadened to include productive use cases enabled by low carbon energy. The focus of the current fund – EAV Fund I – thus evolved from companies providing solar home systems, like d.light, PEGAfrica, Zola Electric, and Zonful Energy, to businesses developing essential, innovative, and productive services backed by energy access such as:
- InspiraFarms: first-mile energy-efficient refrigerated storage, packing, processing solutions for agribusinesses
- SunCulture: solar-powered irrigation pumps and software kits for farmers in East Africa to enable year-round farming
- Mawingu: last-mile affordable internet connectivity based on solar-powered access points using radio frequency (RF)
- Paygo Energy: pay-as-you-go LPG tech-enabled solutions for household cooking
In evolving its focus to include productive energy use, the firm was able to build upon the foundation of energy access and energy transition that enable multi-sector synergies that have lasting economic development and growth implications. Access to credit and the larger financial inclusion benefits are some of the results of these synergies.
To reflect this expanding focus following learnings and wins from the first fund, EAV is rebranding to E3 Capital. In a sub-region that is particularly vulnerable to the effects of global climate change, E3 Capital’s vision is to ‘enable emerging entrepreneurs’ in building low carbon technologies through disruptive and dynamic business models that both serve and enable those at the bottom of the pyramid to contribute to productive economic growth through affordable means.
In its endeavor to implement this vision, E3 Capital will stay true to its core values. As before, E3 Capital will back early stage companies in frontier markets and in sectors that are often overlooked by other funds. Owing to a diverse team of investment professionals on the ground led by one of the only majority-African partnerships in the market, E3 Capital will continue to play a leading role in the growth of emerging companies run by forward thinking and ebullient entrepreneurs.
The E3 Capital investment team will continue to support companies in the current EAV Fund I portfolio. The 15 companies in this portfolio, including one exit, have so far raised approximately $500 million, positively impacted over 21 million individuals, 4 million households and 1,600 businesses, created over 1,200 jobs, generated more than 16 MW of energy, and avoided over 144 million tonnes of CO2.
Launching the E3 Low Carbon Economy Fund I
Committed to bridging the gap between climate transition and financial performance, E3 Capital is launching the E3 Low Carbon Economy Fund I with a target of $150 million. The Fund aims to invest across Sub-Saharan Africa in new technologies and service models that are enabled by digitised and decentralised low-carbon energy solutions. It will support climate smart services, digital connectivity and applications, and solutions that make operations and consumer spending more efficient while leaving a low carbon footprint. Green mobility, agricultural tech (AgTech) solutions, energy storage, and connectivity access are some of the domains that the Fund will consider.
E3 Low Carbon Economy Fund I will carry out E3 Capital’s ambition of productive low carbon transition in partnership with Lion’s Head Global Partners, a frontier and emerging markets-focused investment bank with c.$600 million in assets. This fund will be a first for Lion's Head in the venture capital asset class. Upon its closing, E3 Capital plans to open a new office in Nigeria so as to increase coverage of the West African markets.
Upon closing this new fund, E3 Capital plans to open a new office in Nigeria so as to increase coverage of the West African markets.
“We are excited to introduce E3 Capital because it illustrates our commitment to the future of the low carbon economy in Africa and emerging markets. We believe that start-ups have a major role to play in climate transition, and visionary entrepreneurs will find the right match with E3 Low Carbon Economy Fund on their path to success. We continue to commit ourselves to creating economic value for African economies and our investors without compromising sustainability. At the time of our rebranding, we would also like to thank our limited partners who have supported us since our beginning 7 years ago, as well as the entrepreneurs who have believed in our capacity to deliver value creation in their endeavours.” comments Paras Patel, Founder and Managing Partner of E3 Capital.