French leader in the distribution of solar home systems in West Africa and Madagascar, Baobab+ announces that it has raised €4 million in financing for the expansion of its activities in Côte d’Ivoire and Senegal, respectively from the Energy Entrepreneurs Growth Fund (EEGF), managed by Triple Jump, and the Facility for Energy Inclusion Off-Grid Energy Access Fund (FEI-OGEF), managed by LHGP Asset Management.
Baobab+, a social enterprise operating in Senegal, Côte d’Ivoire, Mali, Madagascar and currently being deployed in Nigeria and the Democratic Republic of Congo, supports households and microentrepreneurs in their energy autonomy and digital access, a prerequisite for their financial inclusion. In order to expand its range to new products and therefore to promote socio-economic development in rural areas, the company has obtained dual financing of €2 million to support its growth in Senegal and Côte d’Ivoire. This is a strong signal of the confidence investors have in the company, as Baobab+ managed to maintain a 60% growth in its “Pay as you go” (progressive payment) energy and digital distribution business in 2020, despite the pandemic context.
Alexandre Coster, founder and CEO of Baobab+, declared: “While in rural areas, only half of the Senegalese population has access to energy and this proportion is under 40% in Côte d’Ivoire, these two rounds of financing will greatly contribute to addressing this situation by allowing us to expand our distribution network of solar kits in these two countries while targeting micro-entrepreneurs further through the distribution of kits for productive use”.
Baobab+ has been operating in Senegal since 2015, where the company has distributed some 100,000 products, particularly in rural areas thanks to the “Pay as you go” system. In Côte d’Ivoire, where it has been operating since 2016, over 50,000 products have already been distributed to households and
Mathilde Sergent, Senior Investment Manager at Triple Jump, stated: “We are very pleased to team up with Baobab+ for EEGF’s first investment, and work towards our shared mission of providing clean and affordable energy to off-grid families and entrepreneurs in line with the United Nations’ Sustainable Development Goal 7. Baobab+ is a leading provider of energy access, digital and financial inclusion solutions in Côte d’Ivoire and we are glad to support the company’s further expansion in a country where over 6 million people live without access to sustainable energy”.
Commenting on the investment, Alban Deheunynck, Investment Officer leading the transaction for FEIOGEF at Lion’s Head added: “Baobab+ has established itself the SHS market leader in Senegal thanks to a strong team and a unique and dynamic business model that serves individual and SME clients. OGEF’s investment will enable Baobab+ to expand operations to throughout Senegal while increasing the product offering to include more appliances, digital products and financial inclusion. With this loan we are delighted to build on Lion’s Head’s wider relationship with Baobab Group, the parent company of Baobab+.”
Launched in 2015 and operating in six African countries, Baobab+ is a social enterprise that supports households and micro-entrepreneurs in their energy autonomy through the distribution of solar kits, which already equip 220,000 households (1.2 million beneficiaries), mostly in rural areas. In addition to this primary vocation, Baobab Group’s subsidiary offers digital devices for educational and professional purposes, with more than 80,000 households (300,000 beneficiaries) already equipped. These products benefit from financing facilities to make them accessible to all.
The Energy Entrepreneurs Growth Fund provides financing to early stage and growth stage companies operating in the energy access ecosystem in sub-Saharan Africa. Launched by the Shell Foundation and FMO, EEGF is managed by Triple Jump and advised by Persistent. The fund has been designed to provide patient, risk-tolerant and flexible capital in the form of equity, mezzanine capital and debt to meet the evolving needs of growing energy companies. EEGF seeks to fill the significant financing gaps in the sector to attract commercial investors on a larger scale. In addition, EEGF provides targeted, practical and operational technical assistance to energy companies, such as interim financial management services, IT and process improvements, portfolio management and HR support, to help them scale up.
The Facility for Energy Inclusion Off-Grid Energy Access Fund provides flexible financing solutions to companies in sub-Saharan Africa providing affordable renewable energy to off-grid communities. The Fund invests through a range of debt instruments, including debt loans, inventory financing, other working capital loans and unsecured corporate debt, to increase the availability of local currency debt and build the capacity of local capital markets. FEI OGEF is sponsored by the African Development Bank and has been funded by the Nordic Development Fund, the European Union, All On and KfW who have provided additional capital from public and private sector investors, including the Global Environment Facility, Calvert Impact Capital and Prudential Insurance.