Ned Tozun - Afrikan Heroes

Africa-focused Solar Firm d.light Raises $50M To Expand Further In Africa

July 21, 2022

d.light, a pioneering manufacturer and provider of renewable energy solutions, has received a new $50 million investment from an international lender consortium comprised of Mirova SunFunder, TDB (Trade and Development Bank), and FMO, the Dutch entrepreneurial development bank.

The investment is structured as a balance sheet debt facility and will allow the company to continue expanding its solar and pay-as-you-go consumer finance business across Africa, as well as develop new creative products.

“The investment underpins the catalytic role of the company in making available clean, reliable solar energy solutions through the pay-as-you-go business model that enables off-grid customers to pay for solar lighting products in affordable instalments using various mobile payment options. Significant amounts of capital are required to enable us to continue providing these financing plans for our customers as we grow. We are thankful for the continued support of our funding partners to enable us to create a brighter future for the families we serve as we continue on our journey to impact a billion lives,” Ned Tozun, d.light CEO and Co-founder said.

In addition to the $238 million off-balance-sheet facility and other financings completed in the last six months, the total money raised for d.light in 2022 now exceeds $300 million.

Why The Investors Invested

“d.light and SunFunder have been partners for nearly 10 years. We have seen d.light transform over 125 million lives with their products and are happy to have been part of their journey of building a future of clean energy for all. We are delighted to have co-led this syndicate of proactive lenders who worked together with one common goal: to provide d.light with additional capital to transform the lives of 1 billion people with sustainable products by 2030,” Collins Kuindwa, who led the transaction for Mirova SunFunder said.

“TDB is pleased to be supporting d.light on their journey to impacting 1 billion lives. Through our triple bottom line approach, we ensure that every transaction we finance is sustainable in economic, social, and environmental terms in our member states. With ongoing CO2 emissions reductions for every household reached, this transaction will create significant environmental impact, while contributing to critical outcomes such as access to electricity, job creation, economic growth, increased health benefits, improved quality of education and more,” Michel Awori, CEO of TDB said.
Read also:Visa Backs Fintech Startup Bloom In $6.5M Seed Round, One Year After Issuing Its First Card In Sudan

“The lack of access to energy continues to hold back social and economic development, particularly in Sub-Saharan Africa. As such, supporting off-grid renewable energy solutions is key to FMO’s strategy. As one of the leading providers of solar home systems and an existing FMO equity investee, we are happy to continue to support d.light on its future growth trajectory. By denominating part of our commitment in local currency, our financing is intended to de-risk the company’s balance sheet, and make it more resilient to potential shocks,” Marina Pannekeet, Manager Energy Eastern & Southern Africa at FMO.

A Look At What d.light Does

d.light has delivered solar electricity to over 125 million people in 70 countries since its inception. Their vast product portfolio includes anything from low-cost portable solar lights to solar home systems and products including TVs, fans, and cellphones.

Africa-focused Payment Startup Bizao Raises $8M Series A Backed By AfricInvest

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexperts.com/view_expert/charles-rapulu-udoh

Kenyan Off-grid Energy Firm d.Light Secures $15m From Norfund

February 8, 2021

d.Light, a Nairobi-based solar firm has been financing its off-grid energy project in Kenya through a special purpose vehicle called Brighter Life Kenya 1 (BLK1), in conjunction with Solar Frontier Capital. Last year, it closed $65m in receivables financing from the United States International Development Finance Corporation(DFC). Now, d.Light’s Brighter Life Kenya 1 project has secured additional funding to take the total amount raised under the project so far to $127m. Norfund, the Norwegian government investment fund, partly provided USD 15 million of the newest financing.

“BLK1 provides us with the flexible local currency receivable financing we need to make our Kenyan business sustainably cash flow positive. Being cash flow positive is a key metric of business sustainability and will enable us to grow and to impact many more lives in Kenya for the long term,” d.light chief executive Ned Tozun said in a statement.

Here Is What You Need To Know

The off-balance sheet financing vehicle is dedicated to acquiring pay-as-you-go solar home system accounts receivables from d.light’s Kenyan subsidiary to provide the company with flexible, working capital to finance its continued growth.

BLK1 is expected to finance the provision of improved energy access to 1.2 million people in Kenya, coming on the heels of d.light celebrating its 100 millionth customer.

Part of BLK1 is being financed by a Sh2 billion ($18.7 million)senior debt commitment from US International Development Finance Corporation (DFC).

Solar Frontier Capital, a wholly-owned subsidiary of African Frontier Capital (AFC, Mauritius), acts as the subordinated lender and the master servicer under the transaction.

The project has been structured to provide d.light Kenya with local currency financing over a two-year commitment period and is intended as the first in a series of vehicles designed to provide d.light with continuing access to sustainable and affordable local currency receivable financing.

“We look forward to continuing to support d.light with on-going access to affordable and sustainable financing for its mission to impact so many lives in Kenya and around the world,” said African Frontier Capital chief executive, Eric De Moudt.

d.Light At A Glance

Although started by the Americans Sam Goldman and Ned Tozun, the Kenya-based startup provides solar-powered solutions — ranging from lights, phone chargers, radios, and even televisions — which are sold in over 60 countries.

In April, it opened a regional office and service center in Eldoret, Kenya as part of the company’s expansion strategy to reach and impact 100 million lives globally by 2020.

The center offers sales services and after-sales services for d.Light’s products including solar home systems and portable solar powered lanterns.

In 2019, the startup received up to $18 million capital injection from a consortium of lenders to help accelerate its growth in Africa.

What Does Receivable Financing Mean?

According to Velotrade, receivables financing takes place when a business receives funding based on purchases that have been made but haven’t been paid for by the clients (accounts receivable).

“A business sells kitchen equipment. They receive a big purchase order by a national restaurant chain (the client). The client is interested in buying equipment worth $400,000. However, even though the restaurant chain needs the equipment right now, it can only make the full payment in the next 4 months. The supplier accepts the terms, delivers the kitchen equipment, and issues an invoice for $400,000 due in 4 months.

Understandably, if this type of purchase is repeated by several other clients, the supplier might run into a cash flow shortage while waiting for payments to be made, jeopardising the company’s ability to function.

The supplier, who wants to avoid cash flow issues, decides to sell the invoice to an invoice factoring company. After checking, among other things, the creditworthiness of the debtor and the length of the commercial relationship, both parties agree terms. The invoice factoring company will advance them $316,000 on the same day the supplier sells the invoice. Then, when the client pays off the full amount due, the invoice factoring company will release the remaining $84,000 minus a factoring free.

By doing this, the supplier gets access to cash immediately after the purchase, the client gets the equipment it needs and gets to pay later, and the factoring company profits from the factoring fees. It’s a win-win situation,” Velotrade illustrates.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer

d.Light Norfund d.Light Norfund d.Light Norfund

Kenyan Solar Startup d.light Secures $65 Million Debt Funding From Solar Frontier Capital

June 14, 2020

Solar Frontier Capital Limited and solar energy startup d.light, a leading global innovator of solar energy products, have jointly announced the establishment of a KSh6.5 billion ($65 million)financing vehicle to be known as Brighter Life Kenya 1 (BLKI) Limited.

“We are excited to announce this innovative funding structure in partnership with SFC,” said d.light CEO Ned Tozun.

“BLK1 provides us with the flexible local currency receivable financing we need to make our Kenyan business sustainably cash flow positive, which is an important milestone for sustainability for d.light and the off-grid energy industry as a whole.”

Here Is What You Need To Know

The off-balance sheet financing vehicle is dedicated to acquiring pay-as-you-go solar home system accounts receivables from d.light’s Kenyan subsidiary to provide the company with flexible, working capital to finance its continued growth.
BLK1 is expected to finance the provision of improved energy access to 1.2 million people in Kenya, coming on the heels of d.light celebrating its 100 millionth customer.
Part of BLK1 is being financed by a Sh2 billion ($18.7 million)senior debt commitment from US International Development Finance Corporation (DFC).
SFC, a wholly-owned subsidiary of African Frontier Capital (AFC, Mauritius), acts as the subordinated lender and the master servicer under the transaction.
The project has been structured to provide d.light Kenya with local currency financing over a two-year commitment period and is intended as the first in a series of vehicles designed to provide d.light with continuing access to sustainable and affordable local currency receivable financing.

Why The Investors Invested

Eric De Moudt, founder and CEO of AFC, said:

“We have been very impressed with d.light as a leading innovator in the distributed energy access sector, and SFC is delighted to be partnering with them on this high impact receivables financing structure. We are greatly looking forward to supporting d.light with on-going access to affordable and sustainable financing to continue impacting so many lives in Kenya and around the world.”

“DFC is proud to team up with d.light and AFC to expand affordable energy to more than a million Kenyans living in off-grid communities,” said DFC Managing Director for Africa Worku Gachou. “This innovative collaboration will deliver reliable electricity access that individuals depend on to live, cook and learn and businesses require growing, investing, and creating jobs.”

d.Light At A Glance

Although started by the Americans Sam Goldman and Ned Tozun, the Kenya-based startup provides solar-powered solutions — ranging from lights, phone chargers, radios, and even televisions — which are sold in over 60 countries.
In April, it opened a regional office and service center in Eldoret, Kenya as part of the company’s expansion strategy to reach and impact 100 million lives globally by 2020.
The center offers sales services and after-sales services for d.Light’s products including solar home systems and portable solar powered lanterns.
In 2019, the startup received up to $18 million capital injection from a consortium of lenders to help accelerate its growth in Africa.

What Does Receivable Financing Mean In Startup Funding?

According to Velotrade, receivables financing takes place when a business receives funding based on purchases that have been made but haven’t been paid for by the clients (accounts receivable).

“A business sells kitchen equipment. They receive a big purchase order by a national restaurant chain (the client). The client is interested in buying equipment worth $400,000. However, even though the restaurant chain needs the equipment right now, it can only make the full payment in the next 4 months. The supplier accepts the terms, delivers the kitchen equipment, and issues an invoice for $400,000 due in 4 months.

Understandably, if this type of purchase is repeated by several other clients, the supplier might run into a cash flow shortage while waiting for payments to be made, jeopardising the company’s ability to function.

The supplier, who wants to avoid cash flow issues, decides to sell the invoice to an invoice factoring company. After checking, among other things, the creditworthiness of the debtor and the length of the commercial relationship, both parties agree terms. The invoice factoring company will advance them $316,000 on the same day the supplier sells the invoice. Then, when the client pays off the full amount due, the invoice factoring company will release the remaining $84,000 minus a factoring free.
Read also:https://afrikanheroes.com/2020/03/18/a-new-160m-energy-inclusion-fund-launched-for-solar-energy-startups-in-africa/

By doing this, the supplier gets access to cash immediately after the purchase, the client gets the equipment it needs and gets to pay later, and the factoring company profits from the factoring fees. It’s a win-win situation,” Velotrade illustrates.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer.