Leading off-grid solar company SolarNow today announces its $9 million series-B equity round. This capital allows the Dutch company to scale its distribution in Uganda and Kenya and expand into new markets. Investors include Novastar and Shell.
Press Release – SolarNow sells and installs high quality customized solar energy solutions capable of supporting income-generating activities, as well as the widest range of electrical appliances available in East African markets, including televisions, fridges and water pumps. The firm’s 55 branches (850 FTE) support an installed base of 25,000 households, schools, clinics and entrepreneurs in Uganda and Kenya. With sales of 1,400 new systems generating revenues in excess of $1M per month, SolarNow is one of the first solar companies in Africa to achieve operational profitability.
“This investment allows us to strengthen our market share in existing markets, and continue our organic growth path into new markets in East and West Africa” says Willem Nolens, SolarNow’s founder and CEO. He adds that “the investment will allow us to design and market more productive appliances, thereby enabling farmers to increase their income”.
Novastar Ventures, based in Nairobi Kenya increased its shareholding during this round. Novastar’s Managing Director Andrew Carruthers explains: “Since we invested three years ago, SolarNow’s management have proven their ability to successfully scale a business model with strong unit economics. We are delighted to see that the company’s rigorous focus on quality and customer satisfaction is proving successful, with over 40% of all new clients being referred by existing clients.”
“We are impressed by SolarNow’s talented and experienced team. They have built a proven business and an exciting modular product offering”, said Brian Davis, Vice President, Integrated Energy Solutions for New Energies at Shell. “We believe that decentralised solutions will play an important role in providing productive energy to customers who currently lack reliable power. This investment is an important step for our Energy Access portfolio and we look forward to helping the business reach its potential.”
SolarNow was established in 2011 to answer the pressing demand for affordable, high-quality solar home systems amongst millions of off-grid households and entrepreneurs in East Africa. The company developed an innovative, modular product range (50Wp – 10KWp) that is sold through branches in rural areas. Products include appliances such as radios, TVs, refrigerators and water pumps amongst others, and come with a 24-month credit facility and 5 years of free service. The operations follow a simple, highly-standardized and low-cost design. Client repayment rate exceeds 98%, reflecting the company’s extraordinary level of client satisfaction.
About Novastar Ventures
Novastar is a venture catalyst firm assisting the next generation of exceptional entrepreneurs who are designing and executing innovative business models to profitably serve East Africa’s aspiring mass market. These ‘New Stars’ are the catalysts for innovation, accountability, efficiency and the accumulation of wealth for the common good. Novastar partners with entrepreneurs to help bring ideas to life and multiply their impact.
About Shell Technology Ventures
Shell Technology Ventures B.V. is the corporate venture capital arm of Royal Dutch Shell plc (“Shell”). It supports Shell’s New Energies business which was created in 2016. New Energies focuses on two main areas: new fuels for transport, such as advanced biofuels and hydrogen; and power, which includes low-carbon sources such as wind and solar, as well as natural gas. Within the power portfolio, Shell is also actively pursuing investments in scalable commercial businesses that expand energy access to communities who currently have no energy at all or unreliable supply.
There are 1.2 billion people in developing countries with no access to electricity, while another billion only have unreliable access. Solar power now offers an economic solution for people living off-grid in rural areas, providing lighting, mobile phone charging and even highly-efficient televisions and fridges. A new generation of solar companies has emerged to deploy these systems commercially, but many have struggled to access mainstream financing to fuel their growth.