#sunfunder

Al heel wat jaren investeren we niet alleen in de energietransitie in ons eigen huis en eigen land, maar ook in het buitenland. Al sinds 2009 via een participatie het fonds bestaande parken van Meewind, dat in Belwind heeft geïnvesteerd. Rond dezelfde tijd zijn we begonnen met het investeren in microkrediet via het inmiddels ter ziele gegane MyC4. In 2013 zijn we begonnen met investeren in…

We are announcing a new $2 million loan facility to SolarNow that marks the launch of SunFunder’s newest product, the Structured Asset Finance Instrument (SAFI). SAFI has been specially created by our team of structured finance experts to meet the needs of the off-grid solar residential market. 

SolarNow is a solar distributor in Uganda that makes solar affordable through a 24-month payment plan. This business model ensures that  they can make high quality solar be available to low income households, but it also turns the company into an extremely working capital intensive business due to the growing receivables. SAFI provides a replicable, flexible transaction structure to finance receivables for solar home system providers selling systems on credit. The initial $2 million SAFI facility is the fourth loan facility between SunFunder and SolarNow, a leading pay-as-you-go solar home system and electrical appliance provider in Uganda.

          A small business with a SolarNow system installed

SunFunder began lending to SolarNow in 2013 with small, crowdfunded inventory loans. Through these initial loans, SolarNow established a repayment track record that helped enable SunFunder to unlock capital from accredited investors for larger and longer-term loans needed to match SolarNow’s growing working capital needs. In 2015, SunFunder extended facilities totaling over $800,000 of loans to SolarNow. The new SAFI facility builds on SolarNow’s strong track record in sourcing high-quality customers and extending credit on appropriately sized solar home systems based on customers’ energy needs and their ability to repay. The facility will scale SolarNow’s capacity to build and service such customers with contract terms in the future and multiply the positive impact SolarNow can make in the region.

“The launch of SAFI marks a new chapter in our long-standing relationship with a top-quality solar company,” said Audrey Desiderato, SunFunder’s Co-Founder and Chief Operating Officer. “Our partnership with SolarNow has grown with our own evolution as a financier. Starting with small crowdfunded inventory loans, to larger working capital facilities funded through our Solar Empowerment Fund. The launch of SAFI, marks a next step in our relationship and aims to efficiently deliver scale. We are proud to announce this market-leading transaction with SolarNow and play an important role in their continued success in the market.”

“SunFunder has been a fantastic partner throughout this process,” said SolarNow’s Managing Director Willem Nolens. “With this financing in place, the board and management believe our business is now well placed to continue our growth in Uganda and beyond.”

          A family in Uganda enjoying solar powered electricity from SolarNow

SAFI draws on well-understood and internationally proven asset-finance concepts which have been consolidated and adapted to the off-grid solar sector. It is designed to be replicable to other solar providers across a wide range of developing markets and expandable in size by permitting additional investors to join a syndicate alongside SunFunder. This structure ensures that any of SunFunder’s loan facility with SAFI can match an operator’s growth profile over the long term on consistent and fair terms, allowing the operator to concentrate on growing their business. The availability of SAFI complements SunFunder’s recently announced OPIC-backed $50 million Beyond The Grid Solar Fund, which will allow SunFunder to provide greater debt capital to companies operating along the solar off-grid and grid-deficit value chain.

SunFunder’s goal is to finance $1 billion dollars into solar loans around the world by 2020 and to prove that emerging market solar is both a profitable and impactful sector.  To this end, OPIC signed a $15 million commitment to be an anchor investor in SunFunder's Beyond The Grid Solar Fund, which will allow SunFunder to provide greater debt capital to companies operating along the solar off-grid and grid-deficit value chain. For more information on OPIC’s investment, see the official press release.

Beyond The Grid Solar Fund will enable several million individuals in low-income communities to benefit from switching from kerosene to solar energy, reducing households and businesses’ expenditures on energy and significantly reducing CO2 emissions.  The fund will be open to other investors for the remainder of the year.

“Solar energy is the most viable solution to replace dirty and unreliable fossil fuel energy sources and to increase energy access for those who really need it,” said Ryan Levinson, SunFunder’s Founder and Chief Executive Officer. “To support solar’s growth in emerging markets, access to sector-specific financing is key. OPIC’s investment in SunFunder's Beyond The Grid Solar Fund will help expand our ability to respond to the financing gap that exists for off-grid and grid-deficit solar. Getting this kind of support and validation from OPIC will open up more opportunities not only for solar enterprises but also for investors worldwide.”

Debt investors include: Iberdrola, Deutsche Bank, Ceniarth, The David and Lucile Packard Foundation, Calvert Foundation, Treehouse Investments, DOEN Foundation, Arjuna Income and Impact Fund, Etho Capital and 29 individual accredited investors

Equity investors include: Treehouse Investments, Khosla Impact, Schneider Electric and Better Ventures

In 2015, SunFunder raised over $17 million in equity and debt capital for financing solar projects. Along with the other $131 million total equity investments in 2015 that have poured into the off-grid solar sector, SunFunder’s total investments send a strong signal that this sector is growing and has tremendous potential. One estimate puts this sector’s market opportunity at $12 billion annually by 2030.

Below we provide more information about our  equity and debt fundraising in 2015:

Equity

SunFunder raised $3.3 million in a Series B investment that closed in December 2015.

The round was led by Treehouse Investments and also included existing investors Khosla Impact, Schneider Electric, Better Ventures, Radicle Capital, and several angel investors. 

On why Treehouse Investments chose to invest in SunFunder, Director Raoul Slavin says, “Treehouse seeks to promote the efficient allocation of real capital to real needs - Sunfunder does precisely that.  We began by investing in their Solar Notes, but became increasingly impressed with their team and its vision.”

The Series B investment is aimed at helping SunFunder achieve its goal of catalyzing billions of debt financing into solar projects in emerging markets in the next decade. In particular, the Series B investment will allow SunFunder to:

Expand into new geographies and solar project segments

Make investments in off-grid solar efficient and a mainstream finance product for accredited investors

Provide a variety of loan products, including inventory, to structured (asset-securitized) finance, and project finance

Build stronger processes around diligence and risk mitigation and increase SunFunder’s expertise with technology and systems

Debt

SunFunder raised $13 million of Solar Notes in 2015 for financing solar projects in emerging markets. Solar Notes are a private debt offering that gives accredited investors an opportunity to invest in a diversified, vetted and high-impact portfolio of off-grid and grid deficit solar projects.

In 2015, 44 accredited investors invested in SunFunder’s Solar Notes. More than half of Solar Notes investors are individual accredited investors from 5 countries. The others are institutional investors that represent a wide range of entities, including corporations Iberdrola and Deutsche Bank, investment firms Arjuna Income and Impact Fund, Treehouse Investments, Ceniarth and Etho Capital, and foundations DOEN Foundation, Calvert Foundation, and Packard Foundation.

To date, about 1 out every 4 of SunFunder’s accredited investors have made repeat investments in Solar Notes. Of the Solar Notes investors that have been repaid, 65% have reinvested their principal to more Solar Notes

SunFunder Progress and Goals

To date SunFunder has facilitated debt financing of $7 million to 22 solar companies in Africa and Asia while maintaining a default rate below 1%.  To investors of our Solar Notes debt offering, we have maintained a 100% repayment rate.  

SunFunder’s solar borrowers include companies such as d.light design, Greenlight Planet, SolarNow, Off Grid Electric, BBOXX, One Degree Solar, and others.

Over half a million people have gained access to clean and affordable solar energy as a result of SunFunder’s work.

By Marilu Snyders

In a time when we are at the cusp of incredible technological advances, a stark reality exists in contrast to seemingly infinite possibilities. At the same time you are reading this on your laptop or smartphone, 1.3 billion people on this planet do not even have basic access to electricity. The majority of these energy-poor communities are based in rural Asia and Africa as well as in urban areas in some less-developed nations.

While extending the electricity grid is one solution to connecting people to this vital need, it is a slow and expensive process, especially in the more remote geographies. And as the world’s population expands, the off-grid market keeps growing - often faster than the rate of grid extension. With most of the rural areas having excellent solar potential and studies indicating that there is a definite demand for rural communities to gain access to electricity, off-grid PV solutions are a much more cost-effective and realistic solution to this growing problem.

The African market has one of the the biggest global demands for solar products. Although the IEA (International Energy Agency) projects that 950 million people in Sub-Saharan Africa will gain access through mainly off-grid and mini-grid solutions by 2040, in that same amount of time 530 million in the same geography will remain in the dark. The barriers to universal energy access are multiple but access to finance across the entire supply chain remains a major concern. This is where SunFunder plays an integral part in the vision of lighting up Sub-Saharan Africa, greater Africa and other rural parts of the planet.

    Lower cost, easier access

As the demand for solar PV products increase, the cost of manufacturing and importing them is steadily decreasing, strengthening their position as a viable solution to the energy poverty problem year upon year. Financial support is required in all parts of the supply chain, from manufacturing to the end user. Realistic or not, the IEA estimates that $640 billion will be needed to ensure global energy access over the next 20 years. This is 300 to 500 per cent higher than current investments in energy access. The need for solar financing companies like SunFunder which can unlock capital to catalyze the expansion of the off-grid market is more evident than ever before.

Over and above the visible need for financial support, there are other, more  strategic factors that need to be considered in growing the off-grid market. Each geography and community has different requirements, key players and ways of conducting business. This is why SunFunder is growing its regional presence and local expertise in our focus markets (currently East Africa and parts of Asia).

By Irene Mayallah (Operations and Outreach Lead, SunFunder East Africa)

On a sunny Wednesday the SunFunder Arusha team enjoyed the view of Mt Meru on their way up the Ilboru rough road to Yohanes’ house to install a Greenlight Planet Sun King Home solar system. Yohanes is a farmer by day and a security guard by night. He has 5 children and wanted to light his home so that they could study in a bright room.

The Sun King home system is manufactured by one of our borrowers, Greenlight Planet, and distributed by another one of our borrowers, Global Cycle Solutions. Today, it was Baraka, the Financial Analyst-turned-Fundi (Fundi is the Swahili word for “technician”) that delivered the complete solar powered light system to Yohanes’ home. It is is fully equipped with three hanging lamps and wall mounts for light switches. It has a 6W solar panel and 2 USB ports for easy charging capabilities.

To set up the home system, Baraka the “Fundi” started by finding a sunny spot to place the solar panel. Elisha and Joshua held the ladder to make sure our Fundi doesn’t fall.

On the inside, Lais installed the Control Panel (with a Battery Meter) by the front door.

(Control panel)

After placement of the solar panel, it was then connected into the main control panel. Joshua went ahead to find the best spot for the first light outside, then connecting it to the control panel.

(Audrey reading the instruction manual carefully making sure the installation goes perfectly!)

The second light was placed in the sitting room; right in the middle of the room. Quite useful for the children to use when doing their homework and studying at night.

(Still counting? I’ve got four so far…..)

We went on plugging in the third light and the light switches. Each light comes equipped with a daisy chain adaptor and two wires; one that you can connect to the control panel and one leading to the light switch. Another amazing thing is that each light has three brightness modes. The battery management technology automatically switches three lamps to low-power mode when the battery is running low, yielding additional hours of light.

(Lais saying, “This switch is good to go! Who wants to light up the room?”)

(Yohanes’ eldest son doing the honor of lighting the sitting room being cheered on by Baraka. Joshua is in the next room doing his magic behind the curtains!)

(The room was not only lit up by the new solar lights, the smiles were even brighter! Audrey and Yohanes’ daughter pictured here. The Sun King home system also comes with a free Sun King Eco, the green portable light- helpful for traveling at night.)

(Well, it was my turn to see how the three brightness modes works…)

You may notice that a light switch and wires already exist on the walls. Yohannes had installed these years ago, waiting for the day that he could access (and afford) connection to the grid. He got tired of waiting and opted for a solar system instead.

[The team pausing for a photo after a hard hour’s work installing the Sun King home system…… From  Left to right top row: Yohanes’ eldest, Alycia (Head of Debt Funds), Yohanes’ 2nd son, Yohanes himself, Yohanes’ daughter, Audrey (COO), Joshua (Portfolio Manager), Elisha (Portfolio Analyst). From left to right bottom row: 2 neighbour kids, Baraka (Financial Analyst) and myself Irene (Operations & Outreach Lead) with Yohanes’ last born. Photograph by Lais (Business Development Associate).]

A year and a half after its launch, SunFunder’s first private debt note series with an 18-month tenor is now fully repaid. As of March 10, 2015, four investors received their principal plus a fixed interest return. Below are the solar customers in this series’s portfolio:

SunnyMoney

SolarNow

Fenix International

BBOXX

Global Cycle Solutions

Zamsolar