Equator Africa Secures $5M IFC Funding to Propel African Climate Tech Innovation
Equator Africa, a climate tech venture capital firm, has secured a $5 million investment from the International Financial Corporation (IFC). This funding aims to support climate tech innovation in Africa, especially for seed and Series A-stage startups.
The investment follows an initial $40 million close in April 2023. Equator Africa’s mission is to close the funding gap for climate tech startups across sub-Saharan Africa. The Korea Green Resilient and Innovative Development (K-GRID) Programme, a $30 million initiative by the Korean government, contributed a $1.5 million guarantee as part of this final investment. With the new contributions, the fund has now reached a total of $54 million.
Supporting Climate Tech Innovation in Africa
Climate technology represents one of the most promising areas for innovation and growth in Africa. According to Farid Fezoua, IFC’s Global Director for Disruptive Technologies, Services, and Funds, this sector is transforming economies while promoting sustainability.
“IFC’s investment in Equator Africa reflects our commitment to support businesses delivering solutions, from renewable energy to electric vehicles,” Fezoua said.
Equator Africa focuses on early-stage, tech-enabled companies developing solutions in green energy, agriculture, and sustainable mobility. While the fund primarily targets companies in Kenya and Nigeria, it has also extended support to startups in Côte d’Ivoire, Ghana, Madagascar, Senegal, Sierra Leone, South Africa, and Zambia.
Notable Investments
Among the fund’s investments is SunCulture, a Kenyan company providing solar-powered energy and irrigation systems to farmers. Another standout is Roam, which designs and develops electric motorcycles and buses in Kenya. The fund has also supported Odyssey, a platform that facilitates investment and asset management for renewable energy infrastructure.
Additional investments include Apollo Agriculture, a Nairobi-based tech company offering smallholder farmers access to input financing and advisory services. Ibisa, another portfolio company, provides parametric insurance products for climate risks, while Downforce Technologies focuses on making soil organic carbon measurement technology accessible.
The Growing Climate Tech Sector in Africa
The African climate tech sector has seen significant growth in recent years. According to an analysis by Africa, The Big Deal, climate tech startups in the region have raised $325 million in 2024 alone. This follows a steady increase in climate funding, which rose from $340 million in 2019 to $1.1 billion by 2023.
Despite this growth, reports indicate that climate funding in Africa is still far below the amount needed to meet the continent’s climate goals by 2030. Current annual climate funding stands at $30 billion, but estimates show it needs to rise to nearly $300 billion annually to meet both mitigation and adaptation goals.
Looking Ahead
Recent developments show that the momentum in African climate tech is continuing to build. In March 2024, Satgana, another venture capital firm, closed its first fund to support early-stage climate tech startups in Africa. The African Development Bank Group (AfDB) also made a $10 million equity investment in the KawiSafi II Fund to boost climate tech innovation on the continent.
With its latest IFC funding and a clear focus on sustainable growth, Equator Africa is well-positioned to continue driving the future of African climate tech innovation.
