Uganda-based Dutch solar asset finance firm SolarNow has received $2.5 million from Novastar Ventures and Acumen as equity funding to help promote solar technology in East Africa.
Providing a range of modular 50-500 watt solar home systems and direct current appliances through a franchise model to mainly rural customers in Uganda, the Fund will also help the firm expand into Kenya, Tanzania and Rwanda next year.
SolarNow chief executive Willem Nolens said the firm plans to focus on fulfilling the growing demands of its customers and expand to underserved areas of the country, as well as into other East African markets.
“Our business has high working capital demands. The more we sell, the more money we need,” Mr Nolens said.
Renewable energy products
He said the funding from the two equity firms is an acknowledgment of SolarNow’s business model, and a shared assessment of the future plans in bringing together affordability and distribution of renewable energy products to consumers.
Duncan Onyango, East Africa director at Acumen, said they are excited over SolarNow’s investment aimed at improving the lives of rural households in Uganda.
The Mauritius-based Novastar Ventures plans to invest $80 million in equity and near-equity investments in East Africa in early-stage businesses serving the mass market and with the potential of growing rapidly. The US-based Acumen has invested more than $87 million in 81 companies across Africa and South Asia.
SolarNow Services (U) Ltd, a subsidiary of SolarNow BV from the Netherlands, distributes solar energy solutions to off-grid customers with an 18-month credit facility.
So far, the firm has distributed more than 5,000 solar systems across Uganda, and plans to extend its network to the 112 districts countrywide by end of next year