In a significant boost for Nigeria’s clean energy sector, Earthbond, a climate tech startup, has secured investment from Madica, an Africa-focused pre-seed investment program. Earthbond is transforming how small and medium-sized enterprises (SMEs) access affordable, reliable solar energy by providing a seamless marketplace that connects businesses with solar financing and certified installers. This investment will not only help Earthbond scale its operations but also further its mission of closing the energy gap for Nigerian SMEs burdened by high electricity costs and unreliable power grids.
Addressing Nigeria’s Energy Challenges
Nigeria faces chronic power shortages, which force many businesses to rely on expensive and environmentally damaging diesel generators. The off-grid generator market is valued at a staggering $14 billion, a large portion of which is fueled by SMEs’ energy needs. Earthbond’s founder and CEO, Chidalu Onyenso, a Harvard MBA graduate and seasoned product manager, launched the startup in 2023 to address these challenges by offering solar energy as a sustainable alternative.
Grid failures in Nigeria are not only frequent but costly. According to Earthbond, businesses lose over $29 billion annually due to reliance on generators. By offering solar power solutions, Earthbond provides a clean, cost-effective energy source, but high upfront installation costs have deterred many SMEs from transitioning to solar energy.
The Earthbond Model: Simplifying Access to Solar Power
Earthbond’s platform is designed to overcome these barriers by providing embedded solar finance, which allows SMEs to spread out the cost of solar installations over time. Through its integrated marketplace, businesses can find vetted suppliers of solar systems and access loans from partner financial institutions. This business model offers a one-stop solution for businesses looking to reduce their dependence on diesel generators.
To date, Earthbond has conducted energy audits for over 100 potential customers in Lagos, with a combined value of $1 million in solar projects. The startup has also secured partnerships with four banks to facilitate financing options for SMEs. The growing demand for its services is evident, with over 1,800 SMEs expressing interest in joining Earthbond’s platform.
Scaling for Impact: Madica’s Role
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Madica’s investment will play a crucial role in Earthbond’s growth strategy. Over the next three years, Earthbond aims to enable $10 million in targeted solar loans, expand its sales and marketing efforts, and enhance its suite of tools for better customer experience. These tools include new maintenance services and payment options, making it easier for businesses to manage their solar systems efficiently.
Furthermore, Earthbond plans to introduce carbon credit discounts, providing an additional revenue stream while incentivizing businesses to adopt cleaner energy solutions. This innovative approach to financing solar projects is expected to accelerate the adoption of renewable energy among SMEs.
Madica’s Commitment to African Innovation
Madica, which launched in 2022 as an initiative of Flourish Ventures, is committed to supporting African startups with underrepresented founders. Through its pre-seed investment program, Madica provides up to $200,000 in funding to early-stage startups, along with 18 months of dedicated support. This includes mentorship, a tailored startup curriculum, immersion trips, and access to a global network of investors for future funding opportunities.
In April 2024, Madica made its first set of African investments, allocating $200,000 each to three startups: Kola Market, GoBEBA, and NewForm Foods. With its investment in Earthbond, Madica continues its mission of empowering innovative African startups to solve critical challenges.
Madica’s Head, Emmanuel Adegboye, expressed confidence in Earthbond’s potential, stating, “Earthbond is tackling critical climate challenges with innovative solutions. We believe this investment will significantly impact Africa’s clean energy future.”
A Pivotal Moment for Earthbond
For Earthbond, the partnership with Madica marks a pivotal moment in the startup’s journey. According to Onyenso, the investment will enable the company to lead Nigeria’s energy transition for SMEs, positioning Earthbond as a key player in the fight against energy poverty.
“With this support, we’re ready to lead the energy transition for Nigeria’s SMEs,” Onyenso remarked, underscoring the importance of the investment.
Conclusion
As Nigeria continues to grapple with unreliable electricity and high energy costs, Earthbond’s innovative approach to providing affordable solar energy could be a game-changer for the country’s SMEs. With Madica’s investment, Earthbond is poised to scale its operations and contribute to a cleaner, more sustainable future for businesses across Nigeria. By offering financial solutions, expert support, and reliable solar installations, Earthbond is bridging the energy gap and driving the country toward a more resilient energy landscape.
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