DFC invests $25 million in Novastar’s Africa People + Planet Fund

The US Worldwide Growth Finance Company (DFC) has made a $25 million fairness funding in a brand new fund arrange by Pan-African enterprise capital agency Novastar Ventures to assist founders creating agriculture and local weather options.

DFC disclosed the small print of the transaction and Novastar’s new funding automobile, Africa Individuals + Planet Fund, in its newest assertion. update detailing transactions it has accredited in the previous couple of months.

TechCrunch wasn’t in a position to determine the small print of the opposite restricted companions who made the dedication, however sources acquainted with the fund mentioned the Nairobi and Lagos-based VC agency is aiming to exceed $200 million, making it one of many largest funds within the area.

The African Individuals + Planet Fund is Novastar’s third pool after the $108 million Africa Fund II, the place it has expanded its geographic attain to incorporate West Africa. The East Africa Fund – an $80 million fund with a $12.5 million co-investment facility – was the primary cat within the area to put money into 15 startups.

Novastar’s two earlier funds have funded tech-backed startups serving the mass market in quite a lot of industries, together with agriculture, training and off-grid renewable power. Commerce Warehouse; an e-commerce scale, Turaco; an insurance coverage expertise, Moniepoint (previously TeamApt); a fintech, mPharma; a well being expertise, MoKo; a furnishings startup and iProcure; an agricultural expertise is amongst Novastar’s investments.

“Going ahead, we goal to construct on this expertise and use the identical instruments and techniques in Africa to assist sustainable, planet-positive, mass-market enterprise fashions that the remainder of the world can study from,” mentioned Novastar co-founder. managing associate Andrew Carruthers instructed TechCrunch.

With the brand new funding, the VC agency mentioned it’s going to put money into local weather applied sciences, clear applied sciences, markets and initiatives that contribute to neighborhood resilience by way of the supply of economic and provide chain providers.

“We see alternatives in all three classes pushed by clear megatrends reminiscent of huge inhabitants development, speedy urbanization and the large quantity of arable land on the continent,” Carruthers mentioned.

Goal initiatives embrace marketplaces, monetary and provide chain providers that may “present market entry and local weather change resilience for a lot of.”

Clear applied sciences that VC plans to assist embrace clear utilities, clear development applied sciences, electrical mobility, good logistics, round financial system, different supplies that may “assist decarbonize the expansion we’ll see on the continent within the subsequent 10 years”. 20 years,” Carruthers mentioned.

Novastar may also assist local weather applied sciences that use revolutionary enterprise fashions “to use regenerative forestry, agriculture and aquaculture, biofuels and biochar that preserve biodiversity, enhance soil well being and seize carbon,” whereas creating extra alternatives for small-scale farming. The VC agency is elevating extra funding for clear applied sciences in Africa, which final yr was the second most funded startup within the area after fintechs.