PEG completes $7.5 million round to expand activities in West Africa
Accra, Ghana – PEG, the leading off-grid solar company in Ghana, announced today that it has closed a $7.5 million Series A round. The funding will be used to expand operations in Ghana, build out the management team, and to enter Ivory Coast.
PEG provides loans for solar home systems and other useful assets to off-grid households in West Africa. PEG is able to focus on off-grid customers, who are often rural and considered risky by banks and microfinance, because it provides loans using ‘pay-as-you-go’ technology. This technology allows PEG to control assets remotely in the field while they are being repaid by customers. Importantly, by allowing customers to pay over time in small increments, PEG is able to reach many customers who would not otherwise be able to afford such life-changing products.
Hugh Whalan, CEO of PEG, says: “We are thrilled to receive the support of new and existing investors, and to continue our vision to bring pay-as-you-go financing to the massive, and largely ignored, West African market. As a market leader in this region, where there are 35 million off-grid homes, we are uniquely placed to do this.”
PEG has over 10,000 customers and operates 29 service centers in 7 regions of Ghana. The Series A investment comes from a $4.3 million USD A-2 round which closed today and follows an earlier A-1 investment of $3.2 million in September 2015. The A-2 round was led by Energy Access Ventures, and includes Blue Haven Initiative, as well as follow-on investment from existing investors, Investisseurs & Partenaires (I&P) and Engie Rassembleurs d’Energies. These investors join Impact Assets and Persistent Energy Capital, among others.
Dr. Michael Gera, Managing Partner of EAV, says: “We are immensely proud to be investing in PEG. EAV was hugely impressed with PEG’s leadership team and greatly looks forward to working with the company and its other investors.” Lauren Cochran, Director of Private Investments, Blue Haven Initiative added: “PEG represents our first investment in West Africa, a region that has been under the radar of most energy focused investors for far too long, and Blue Haven Initiative is excited to welcome PEG into its portfolio of innovative energy and fin-tech companies in Africa.”
PEG’s customers are typically farmers or fisherman living in peri-urban or rural areas, who earn $1-$10 per day. They currently spend up to 30% of their incomes on poor quality, polluting fuels like kerosene, candles or batteries which create indoor air pollution contributing to more deaths than Malaria each year in Africa. A PEG customer who takes a loan for a solar home system can not only expect to receive access to clean, convenient light, radio and phone charging, but they will also save up to $800 over the useful life of solar system. In addition, as less than 30% of PEG’s customers have access to microfinance or local banks, the loan provided by PEG allows them to start building a credit history which can transform their ability to access finance.
Existing investor, Sebastien Boye, Chief Investment Officer of I&P, commented: “I&P is very enthusiastic to participate in PEG’s new round of financing. As one of the first investors, we are strong believers in PEG’s mission and their potential” and Laure Vinçotte, Managing Director of ENGIE Rassembleurs d’Energies, concluded: “PEG’s achievements in powering people in Ghana thanks to an innovative clean solution is fully in line with ENGIE Rassembleurs d’Energies’ objective of promoting access to sustainable energy for all.
PEG is a leading pay-as-you-go financing company in West Africa, and the largest in Ghana. PEG is focused on providing credit for useful and productive assets to off-grid customers, and by doing this, we seek to enable customers to gain ownership of assets that they wouldn’t otherwise be able to afford. Importantly, as customers pay off their loan to PEG, we start to understand their credit history, which is a valuable tool we can then use to provide for additional loans for products and services.
PEG has been awarded grants by CGAP, GSMA Foundation, National Geographic and Energy4Everyone, and won the COP21 Energy Award in Paris in 2015. More information found at www.peg-ghana.com.
EAV is the first focused venture firm that invests in the growing number of dynamic and innovative companies that are taking on the challenge of energy access in Africa. With a team that has substantial investment and operating experience, and backers from industry and development finance, the firm brings a unique, hands-on approach to its portfolio companies that will ensure it has a transformative impact in its target markets. More information found at www.eavafrica.com.
About Blue Haven
Founded in 2012, Blue Haven Initiative (BHI) is a single-family office headquartered in Cambridge, MA, managing a diversified international investment portfolio. BHI’s direct investment strategy targets innovative for-profit business models that improve standards of living, create economic opportunity and better the environment for people and businesses that are underserved by or out of reach of existing infrastructure. BHI makes debt and equity investments with the dual expectation of both best-in-class financial returns and the achievement of maximum positive social and environmental impact. More information found at www.bluehaveninitiative.com.
About Engie’s Rassembleur D’energies Initiative
ENGIE Rassembleurs d’Energies is ENGIE’s €50M corporate impact investment company. Its aim is to invest in social enterprises providing sustainable access to electricity, combating energy poverty and improving cooking facilities through innovative solutions. To date it has invested in social enterprises involved in 8 countries across 4 continents.
ENGIE is a global energy player, that develops its businesses (power, natural gas, energy services) around a model based on responsible growth to take on the major challenges of energy’s transition to a low-carbon economy: access to sustainable energy, climate-change mitigation and adaptation, security of supply and the rational use of resources.
About Investisseurs & Partenaires
Investisseurs & Partenaires (I&P) is an impact investment group dedicated to African Small and Medium Enterprises. Since its creation in 2002, I&P has invested in more than 50 companies, located in 15 African countries and operating in various sectors of activity (health, transport, microfinance…). These enterprises create local “added value” and long-term employment, and generate important social, environmental and governance impact. Created by Patrice Hoppenot and headed by Jean-Michel Severino since 2011, the I&P team comprises about thirty collaborators in Paris and in its six African offices in Cameroon, Côte d’Ivoire, Senegal, Ghana, Burkina Faso and Madagascar. More information found at www.ietp.com/en.