SunFi, the Nigerian clear tech startup that connects individuals and companies who need photo voltaic power entry to cost plans that match their wants, has raised $2.325 million in seed funding.
The self-described power monetary tech platform obtained backing from lead buyers Nairobi-based Issue[e] and Sterling Financial institution’s SCM Capital Asset Administration and collaborating buyers resembling Voltron Capital, Norrsken Affect Accelerator, Ventures Platform and Sovereign Capital.
On a name with TechCrunch, CEO Rotimi Thomas mentioned the funding will assist SunFi develop its operations and enhance its capabilities to suggest one of the best programs on the lowest price to prospects.
SunFi isn’t Thomas’ first rodeo on the helm of an power startup. In 2018, he co-founded Aspire, a photo voltaic set up firm based mostly on the data he acquired in school on renewable power and dealing in a number of roles regarding power, fuel and energy tasks throughout Nigeria and different African nations, together with a five-year stint at Siemens as head of market improvement. Although this enterprise morphed into SunFi three years later, launching Aspire was the primary of a lifelong journey that Thomas had envisioned in attempting to repair the electrical energy points people and companies face in Nigeria, he mentioned on the decision.
Nigerian households and companies have little or no entry to reasonably priced and dependable photo voltaic expertise, which reduces their reliance on grid-based energy that suffers from inadequate technology capability and fails to serve most of Nigeria’s 200 million individuals who reside in rural areas. Turning to off-grid options that use photo voltaic power is an possibility for these individuals who want electrical energy for easy requirements like lighting, heating and communication. And that’s what Rotimi’s earlier upstart did. Aspire ran a power-as-a-service enterprise mannequin that helped set up greater than 500 photo voltaic programs for people and companies. However regardless of being marketed as an affordable possibility, rural electrification within the type of microgrids and photo voltaic programs may be costly to those sub-consumers due to their low spending energy.
“Prospects would at all times ask us if there was a method for them to pay for the photo voltaic programs in installments,” Thomas mentioned. “Due to that, we went to the banks and tried to work with them to finance this type of cost, however we realized that banks additionally had an issue: they couldn’t sprint out credit score to prospects to finance retail photo voltaic programs once they didn’t perceive the technical dangers concerned in proudly owning them.”
Additional market analysis revealed that different photo voltaic suppliers confronted the identical problem of consumers requesting to pay in installments. Thomas and his co-founders — COO Tomiwa Igun and CTO Olaoluwa Faniyi — determined to offer credit score and commenced leasing these programs in what later turned SunFi. They believed that as an outfit, they might handle the technical danger concerned with photo voltaic programs and that it was extremely seemingly that prospects would pay as a result of they valued photo voltaic programs and noticed them as important items of energy infrastructure.
Give it some thought. Retail photo voltaic programs are marketed by way of phrase of mouth, however with distribution being fragmented and minimal avenues to offer financing, platforms like SunFi that act as aggregators turn into interesting to prospects.
“The problem prospects face with photo voltaic suppliers is that they need options they will pay small for; nevertheless, these photo voltaic platforms can’t supply. As a result of banks are afraid of the technical danger concerned, they want one thing in between to speak with good photo voltaic suppliers and do the set up work whereas offering good capital to prospects searching for the proper answer. We’re the fellows in the midst of all this,” Thomas mentioned.
SunFi creates worth for these clear power buyers by de-risking the technical and credit score danger concerned in financing portfolios of photo voltaic options, opening avenues for lending as a service play for clear power suppliers. Since its official launch final February, SunFi has onboarded over 40 photo voltaic system distributors to its platform at numerous levels of vetting; 10 are its core suppliers, which have served greater than 129 prospects. Throughout the previous 12 months, the one-year-old power startup has deployed greater than $600,000 to those prospects by way of its partnerships with monetary establishments.
The Nigeria-based power firm gives prospects with two cost strategies: a lease to personal, the place after an preliminary deposit, prospects make funds in installments earlier than owing the photo voltaic system, and a subscription mannequin, the place prospects pay to make use of the photo voltaic system month-to-month. SunFi’s revenues are from the margin on the lease-to-own mannequin and subscription charges from the latter. The corporate mentioned it’s engaged on a 3rd income stream the place it’s going to help photo voltaic suppliers with stock financing.
Some startups already finance photo voltaic programs with one or a number of entities, resembling Carbon. However Thomas doesn’t regard them as rivals; the identical goes for photo voltaic system suppliers. As an alternative, most of those platforms are companions since they already fill a necessity available in the market and SunFi’s job aggregates them. “As a result of we’ve got a novel expertise having been a photo voltaic supplier initially and seeing the frustration and challenges of installations in Nigeria, we’ve taken all that technical and credit score data to construct a system that hopefully works for purchasers, photo voltaic suppliers and banks,” mentioned the chief government.
“SunFi additionally has a portal for the photo voltaic supplier to log in, observe and handle their enterprise of constructing a number of varieties of merchandise to market to prospects and get entry to financing. Traders have their dashboard to handle their portal to trace how their cash is spent by way of being deployed to handle portfolios or retail prospects. So we’re constructed as a fintech for the clear tech house, which doesn’t exist in Nigeria.”
The SunFi workforce. Picture Credit: SunFi
The clear tech with fintech options will probably be seeking to improve its platform over the subsequent 12-18 months with this financing. It additionally intends to transform greater than 4,000 prospects inside that very same time-frame because the 29-person workforce continues to develop. The clear tech is in talks to lift extra third-party capital, most probably debt, from business banks and different financing companions to channel that cash by way of the system and finance all of the power platform’s calls for to care for this 12 months.
“SunFi has the flexibility to remodel the best way clear power is accessed by households and companies throughout Nigeria by making a market of fresh power merchandise mixed with versatile cost choices — all of that are customized to the shopper’s monetary and power wants,” mentioned Lyndsay Holley-Handler, accomplice and chief enterprise builder at Issue[e] on the funding. “Platforms like these have unlocked entry to scrub power in different markets however don’t but exist in Africa. This sort of innovation and disruption is why we determined to be a part of SunFi’s journey…”
