Novastar Ventures has secured an equity commitment of up to US$40 million from the Green Climate Fund (GCF) for its new vehicle, the Africa People & Planet Fund III (Fund III).
The fund, with a target size of approximately US$200 million, will back early- and growth-stage companies across Africa focused on climate tech, adaptation, resilience and natural-resource management. Novastar, headquartered in Nairobi and Lagos, already manages more than US$200 million in assets, and this latest commitment is intended to act as a catalytic anchor that de‑risks the fund for other private investors.
According to statements from Novastar and independent reports, the fund will prioritise investments in Kenya, Nigeria, Rwanda, South Africa and Egypt and will deploy capital into three core themes: (1) climate‑adaptation and resilience services, (2) clean technologies to decarbonise economic growth, and (3) climate‑technology for natural‑resource management.
The GCF’s US$40 million commitment forms a significant part of the fund’s opening investor support, which also includes backing from institutions such as British International Investment (BII), Sumitomo Mitsui Banking Corporation (SMBC) and Mitsui O.S.K. Lines (MOL), signalling a growing investor interest in Africa’s climate‑tech landscape.
Analysts say the move addresses one of the major impediments in climate finance for Africa namely, the limited flow of private capital into early‑stage ventures operating in challenging markets. By anchoring such a fund, the GCF hopes to mobilise additional institutional and commercial investors into the continent’s climate‑tech ecosystem.
Novastar’s Fund III now enters its deployment phase and will begin sourcing and investing in qualifying enterprises. The success of the vehicle and the ability to attract private follow‑on capital will be closely watched as a barometer of investor confidence in Africa’s climate‑tech potential.
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