160.000 clean stoves sold in 2.5 years! Nigerian company Green Energy & Biofuels, winner of various prizes and recently named “the best clean energy investment opportunity in West Africa”, is currently raising capital. See their VC4Africa venture profile for more info (sign up for the VC4Africa Investor Pro Account and get access to documents and full details).
Green Energy & Biofuels currently has approximately $1.5 million USD available from a $4 million Series A equity round. In addition, $3 million debt is also sought. We had a chance to catch up with Femi Oye, Green Energy & Biofuels Founder and CEO, aspiring to become Africa’s first multi-billion dollar renewable fuels company. The company is participating in the Global Social Benefit Incubator program in Silicon Valley, USA over the coming months.
How did Green Energy & Biofuels start, and what milestones did you reach to date?
“Green Energy & Biofuels grew out of a program I started to help people start green businesses in my home country, Nigeria. The mission was to lead the way for a new kind of alternative energy for the active working population in Africa and end kerosene usage. We produce a cooking gel from ethanol, and manufacture stoves specially designed to use this cooking fuel.
In the past 2.5 years, we have set up two micro-refineries and are in the process of commissioning a larger one. We aim to provide a network of entrepreneurs with exclusive, aspirational products that address the serious energy poverty needs of over 100 million people.
The consumers response to our products have been staggering. To date, we have sold over 160,000 stoves and over 800,000 liters of cooking gel. We are working night and day to keep up with the demand in Nigeria and inquiries from abroad.
We decided the cooking gel production and stove manufacturing needed to focus on scale as Green Energy & Biofuels, with the aspiration on becoming the first multi-billion dollar renewable fuels company in Africa. This past year, our biggest success was bringing down the price of the cooking fuel by more than 50% to be competitive with the street price of kerosene in Nigeria.”
What’s the essence of your business plan, and what makes you interesting for investors?
“Our business plan has three major steps. Firstly, we will focus on increasing and streamlining our ethanol production to meet the demand for cooking fuel in Nigeria. Secondly, we plan to expand to other markets for clean cooking fuel. Finally, we plan to drive the price down enough to also be able to compete in the transport fuel market. Investors are convinced because we have an established record of growth. When investors realize already over 160,000 households have purchased the stove, they are impressed there is a ready market with no serious competitors.”
What are your unique selling points compared to your competitors? Are there specific sustainability aspects?
“As far as we know, we are the only business in Africa that commercially produces ethanol cooking fuel from waste products. We have patented production processes as well as patented stove design. We were successful in creating this market in Nigeria and are working to widen our first-mover advantage.
We are the first partner of the UN Sustainable Energy for All High-Impact Initiative for Sustainable Bioenergy in Africa. Recently, we were named the best clean energy investment opportunity in West Africa and overall winner at the West Africa Forum for Clean Energy Financing Business Plan competition in Accra.
In terms of sustainability, the health, environmental and job creation impacts of our work are what keep us going. As one of the fastest growing clean cooking businesses in Africa, we know our impact can be much greater in the coming years with the right partners. Like the proverb says- ‘If you want to go quickly, go alone… but if you want to go very far, go with others’
I would like to also give appreciation to our thousands of people across West Africa who have been working tirelessly to bring cleaner, safer and cheaper cooking to their countries and their kitchens, especially our women. Their quality of life improves and they grow in numbers. It is through their efforts we will deliver energy independence, decrease the number of deaths as a result of dangerous and unsafe cooking fuels, guarantee better quality of lives and an end kerosene generation in Africa.”
What investments have you already secured, and what are you still looking for?
“The initial investment was my own from past successful ventures. However, serious local investors saw both the success and potential and quickly joined me. These initial angel investments have helped bring the company to the level it is today.
Last month, the Global Alliance for Clean Cookstoves Spark Growth Fund committed to support our scale-up. This was the first major international financial support for our 100% African owned and grown company. Currently, approximately $1.5 million USD is available from a $4 million ‘Series A’ equity round. In addition, $3 million debt is also sought. We are looking for a maximum of 2 or 3 more strategic investors or syndicates that align with the company’s vision and can enable us to scale quickly.“
Which milestones do you want to reach with your investments? And what do you hope to achieve with Green Energy & Biofuels in the long run?
“Our short term plans are to build a much larger ethanol production facility in Lagos and successfully utilize water hyacinth as a feedstock there. Also, we plan to establish 10 micro-plants around Nigeria to reduce transportation costs. We believe this two-pronged approach will give us the track record to scale and expand to other markets and, in the long term, drive the price down to the point where we have completely undercut kerosene as a cooking fuel in all markets and are competitive as a transport fuel as well. In terms of the foreseen impact after the investment, the goal is to reach over 1 million households by the end of 2017.”
What is your suggestion to other entrepreneurs who wonder what VC4Africa can do for them?
“We are very grateful to have such a resource focused on bringing investment to Africa. We had experimented with other investment websites, and found many more people looking at our company at VC4Africa, because of its unique focus and audience. We hope as many entrepreneurs as possible can benefit from the investment, mentorship and networking opportunities VC4Africa offers.”
For more information see Green Energy & Biofuels’ VC4Africa venture profile. Only registered investors get access to all details and can express their interest to invest.