Investing to Support the Growth of Climate-Resilient Agriculture
2nd April 2024
Nairobi, Kenya: InfraCo Africa, part of the Private Infrastructure Development Group (PIDG), has signed an agreement with Savant Group Ltd, committing US$12 million to scale SunCulture’s solar irrigation offering across sub-Saharan Africa. The equity investment, made through InfraCo Africa’s dedicated investment arm, forms part of an oversubscribed US$27.5 million Series B fundraise set to deliver access to Internet-of-Things (IoT)-enabled solar powered irrigation systems to hundreds of thousands of smallholder farmers by 2030. The majority of these farmers currently rely on rainfed agriculture or on the use of CO2-emitting diesel or petrol irrigation pumps.
SunCulture CEO, Samir Ibrahim, said of today’s announcement, “This is an important milestone for SunCulture, and not just from a financial perspective - it signifies a powerful vote of confidence in our vision, team, and the potential of our company. There's a lot of work to do, and we couldn't be more excited to build with our investors."
SunCulture offers farmers a more sustainable route to managing climate-induced variability of rainfall and displaces the need to use expensive, polluting fuel-based pumps. The company’s unique offering involves the design, manufacture, financing, installation, and maintenance of comprehensive solar irrigation systems with safe, low-voltage DC pumps. Capable of pumping up to 1,200 litres of water per hour, the affordable systems are targeted at smallholdings of approximately 1-3 acres. The solar PV systems include sprinklers, drip irrigation and battery storage which maximise efficiency of water use by enabling farmers to irrigate their land in the early morning – minimising evaporation – and to target water to individual plants, avoiding waste. The IoT-enabled systems include remote monitoring and predictive maintenance. The battery systems also including domestic lighting and enable farmers to charge small devices such as mobile phones.
InfraCo Africa’s Chief Investment and Risk Officer, Claire Jarratt, said, “We are pleased to be joining Savant Group Ltd.’s other Series B investors to achieve financial close for SunCulture’s latest fundraise. Alongside our investment, InfraCo Africa’s involvement will support the company to further develop its HSES and governance frameworks as the company grows and seeks to enter new markets. SunCulture’s unique approach to leveraging consumer financing and carbon credits to reduce the upfront cost of its systems for farmers also aligns well with the PIDG strategy. With access to irrigation, farmers can increase their yields, ensuring greater food security for themselves and their families in the face of the impacts of climate change, and increased agricultural incomes can support wider sustainable economic growth and prosperity in rural areas.”
The ‘total cost of ownership’ for a SunCulture pump is 40-60% lower than the cost of a fuel-based pump, depending on payment plans.i SunCulture offers its pumps to smallholder farmers through a Pay-As-You-Grow model. In a further effort to improve the affordability of its pumps for smallholder farmers, SunCulture is the first African solar water pump provider to have registered for a carbon credit programme, having its emissions reductions independently verified by VERRA, thereby reducing the upfront cost of its pumps for smallholder farmers.
InfraCo Africa is supported by
EKTA Partners acted as the exclusive financial advisor for this transaction, building on the team’s track record in raising capital for tech companies driving positive change globally.
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Notes for editors
Agriculture represents 35% of the Gross Domestic Product (GDP) in Africa and is the continent’s largest employment sector.ii
Seven hundred million people in Africa live on smallholder farms which lack reliable access to water.iii
Just 4% of sub-Saharan Africa’s cultivated land is irrigated, compared with 37% in Asia.iv
Voluntary carbon credit demand is growing with an estimated US$30-50 billion market anticipated by 2030v
SunCulture’s offering is contributing to the achievement of the UN Sustainable Development Goals SDGs 2 – Zero Hunger and 13 – Climate Action.vi
The Private Infrastructure Development Group (PIDG) PIDG is an innovative infrastructure project developer and investor which mobilises private investment in sustainable and inclusive infrastructure in sub-Saharan Africa and south and south-east Asia. PIDG investments promote socio-economic development within a just transition to net zero emissions, combat poverty and contribute to the Sustainable Development Goals (SDGs). PIDG delivers its ambition in line with its values of opportunity, accountability, safety, integrity, and impact. Since 2002, PIDG has supported 211 infrastructure projects to financial close which provided an estimated 222 million people with access to new or improved infrastructure. PIDG is funded by the governments of the United Kingdom, the Netherlands, Switzerland, Australia, Sweden, Germany and the IFC www.pidg.org
InfraCo Africa: InfraCo Africa is part of the Private Infrastructure Development Group (PIDG) and seeks to alleviate poverty by mobilising investment into sub-Saharan infrastructure projects. It does this by investing directly into early-stage projects and by providing development leadership. Through its investments arm, InfraCo Africa can also provide equity to close a financing gap and start construction or fund innovative solutions that need support to scale-up, to pilot new products or enter new markets. InfraCo Africa is funded by the governments of the United Kingdom (through FCDO), the Netherlands (through DGIS) and Switzerland (through SECO). To find out more visit: www.infracoafrica.com
SunCulture: SunCulture is a climate-smart agriculture company for smallholder farmers. SunCulture designs, manufactures, finances, and services IoT-enabled solar energy systems and irrigation equipment, and is the market leader in solar water pumping solutions for smallholder farmers in Africa. SunCulture’s mission is to bring affordable, renewable energy to smallholder farmers in emerging markets to improve productivity and income, enhance resilience, and reduce greenhouse gas emissions. For more information, visit: https://sunculture.com