African energy startups to benefit from SIMA’s $68,000,000 Energy Access Relief Fund
African energy startups to benefit from SIMA’s $68,000,000 Energy Access Relief Fund
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With a focus on ensuring adequate decentralisation of clean energy globally, Social Investment Managers and Advisors’ (SIMA) has made its $68,000,000 Energy Access Relief Fund (EARF) accessible to startups in the energy sector.
Smaller to mid-sized energy companies across sub-Saharan Africa and Asia, addressing the needs of the underserved consumers. are the targets of the short-term loan. It seeks to be as inclusive as possible, with expectations on loans of less than $1,000,000, within a range of $50,000 to $2,500,000.
EARF was launched earlier this year. Development investors and financial institutions came together to raise $80,000,000 to provide energy to at least 20 million people in Sub-Saharan Africa and Asia.
The loan comes with low interest for small businesses, so they can scale operations, reaching the goal of the fund.
To access the funds, primary and secondary criteria were set up for startups in the sector:
The primary criteria include:
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Last pre-COVID fiscal year’s proportion of revenues from Energy Access Activities should be greater than or equal to 50%
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Last pre-COVID fiscal year’s annual revenues should be between $75,000 and $50,000,000 (both inclusive)
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Months of operations should be minimum of 24 months from the end of December 2020
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Total Equity divided by Total Assets as of the end of March 2020 should be greater than or equal to 20%
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Availability of unqualified audit opinion or a credible reference from either vendors, suppliers, institutional equity or debt investors, or institutional grant providers
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The startup must be operating in Africa or Asia
Secondary criteria
Smaller companies must meet at least three secondary criteria, while larger companies must meet at least four criteria. They include:
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Average of the fiscal year 2018 and fiscal year 2019 revenue growth should be greater or equal to 5% for smaller companies and 10% for larger companies
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The management’s local market experience until December 2020 should be greater than or equal to 18 months for smaller companies and 30 months for larger companies
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The company should be female-owned and/or managed
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The company should service low-income customers
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The current cash balance divided by the last two months’ operating expenses should be greater than or equal to 100% for smaller companies and 125% for larger companies
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Actual collections from customers / Scheduled collections should be greater than or equal to 65% from October 2019 to March 2020
How to apply
Are you a startup in the energy sector? Don’t miss the opportunity to accelerate your growth, thereby meeting the needs for electricity across the continent. Apply for the Energy Access Relief Fund while the application is still ongoing.
