Why We Invested: Solibrium Solar
A strong, passionate team with a customer-centric and community-based approach, offering affordable solar power appliances in Kenya.
Summary
Although Kenya has a large and thriving solar industry, there remain challenges to reaching the most remote customers. The industry in Nairobi is highly concentrated, but companies that are able to reach untapped regions of the country will have a competitive advantage and the ability to carve out a niche for themselves in the market.
Our top three reasons to back Solibrium Solar:
- They are a talented, impact driven team that have experience developing business solutions to solving social and environmental problems.
- They are customer-centric, driven by a desire to create loyal customers for a lifetime over short-term profits.
- Their diverse, highly localised team’s community-driven approach gives them a competitive advantage by building rapport and trust within communities.
Solibrium is a fantastic young company led by a great team with good hearts, a solid track record and a lot of potential. With access to a bit of inventory financing from Charm Impact, they will be able to purchase the products they need to keep up with the demand from their customers and scale their operations. We look forward to working with the Solibrium team to reach thousands of people across Kenya and beyond with clean and affordable solar products.
The Kenyan Landscape
Kenya is the fifth largest economy in sub-Saharan Africa with a population of about 51 million. The country has been developing rapidly over the last decade, achieving an average 5.9% GBP growth rate from 2010–2019 (World Bank, 2020). Through Kenya’s Vision 2030 programme, it aims to be a middle-income country by 2030.
The country is also home to one of the largest and most dynamic solar markets in the world. It is the market leader in solar home system sales in Africa, having sold more than 5 million units since 2014. The success of the solar market is largely attributable to a favourable regulatory environment, driven by the government’s goal to achieve universal energy access by 2022 (USAID, 2019).
Solar Power In Kenya
Although the Kenyan solar market is thriving, there remain several key challenges to achieving universal electrification, namely the sparse population and poor infrastructure, which make it difficult to reach people in the most remote regions of the country.
Where there is no or poor connectivity, people traditionally use kerosene lamps and / or diesel generators (a.k.a. “dirty fuel” sources) for light and power. Beyond emitting CO2 that negatively impacts the environment, these products are expensive and a hazard to people’s health and safety. Customers can save 30%-90%+ on their annual energy expenditure when they switch to solar powered lighting systems and appliances. Solar users also avoid inhaling toxic chemicals that cause respiratory infections, and they do not need to worry about burns and fires caused by fallen kerosene lanterns.
Because solar provides a low cost, safe and flexible lighting solution for remote communities, it is unsurprising that the expansion of solar solutions has arisen as a core part of a number of national electrification strategies across sub-Saharan Africa.
Introduction to Solibrium Solar
We recently decided to invest in Solibrium Solar, a solar distributor based in Kakamega Kenya, a small town of about 100,000 people in western Kenya. Solibrium is a certified B-corp that aims to bring affordable solar power to remote Kenyan communities. Solibrium works not only as a distributor and installer of solar home systems for homes and businesses, but it also aims to offer a holistic and complete sales, distribution, service and repair ecosystem to rural solar users.
Solibrium started as a spinoff of Eco2librium, a US-based company that uses business solutions to curb CO2 emissions, conserve and/or restore natural forests and improve the lives of people in western Kenya. Five Eco2librium staff joined forces to create a branch that would focus exclusively on providing solar power solutions to rural customers. Since its founding in 2016, Solibrium has grown its team to 25 people and 700 agents that have sold 4,000 solar products in 15 counties across western Kenya and along the eastern coast.
The Investment Decision
We wanted to invest in Solibrium for many reasons. They are in a strong financial position with healthy year on year revenue and profit growth rates that indicate good management and improved operations over time. They’ve received a series of grants, including the Kenya Off-grid Solar Access Project (KOSAP) Results Based Financing facility led by SNV and Sunfunder, that have allowed them to pilot their products in the market and verify customer demand.
Solibrium also embeds impact into everything they do. Empowering women and reaching underserved customers are at the heart of the company’s mission, vision and strategy. They were also chosen as a Global LEAP Solar E-Waste Challenge winner to address the emerging issue of solar e-waste through SHS life-extension activities.
Beyond the solid financials and strong impact alignment, we have decided on the following top three reasons for partnering with Solibrium: their team, their customer centricity and their community-based approach to business.
1. Why we invested: The Team
Solbrium is led by Anton Espira and Gilfine Nyangasi.
Anton Espira, co-founder and Managing Director for Solibrium Solar, is an experienced entrepreneur with a passion for preserving the environment. He was born and raised in Kenya before moving to Canada to complete a BSc in Zoology from the University of Manitoba. He then went on to secure a Ph.D. in tropical forest ecology from the University of Oxford. He has lived and worked across four continents, including extensive field work in tropical Africa and southeast Asia.
Prior to Solibrium, Anton was one of the founders of Neopeutics, a drug discovery contract research organisation (CRO) based in San Francisco, California, as well as a founding member of the Asia-e-University in Kuala Lumpur, Malaysia. He was also co-founder and Chief Operations Officer for Eco2Librium where he created and managed the successful expansion of the company in Kenya over ten years and employed more than 500 people.
Anton’s vast experience with the business, legal and cultural subtleties in Kenya is an invaluable asset to the Solibrium team.
Gilfine Nyangasi, Assistant Director for Solibrium Solar, is the face of Solibrium’s Kenyan operations.
Gilfine was born and raised in Kenya and completed her bachelors in Agricultural Economics and Resource Management at Moi University in Eldoret Kenya. After university, Gilfine went on to complete the Certified Public Accountant’s Course and applied her accounting skills working for Chestnut Farm, Lachuta Flower Firms, Kamadep Guest House, and Eco2librium.
Before joining Solibrium, Gilfine was the Manager of Human Resources, Administration and Finance for Eco2Librium. As a shrewd leader with a sharp mind for finance, a passion for sustainable resource allocation and experience managing large teams, Gilfine is well suited to lead Solibrium’s expansion across Kenya and beyond.
Beyond being an incredibly talented and qualified workforce, the Solibrium staff offer a formidable combination of a deep passion for combating climate change and improving the lives of poor people in Kenya alongside a breadth of local cultural and contextual knowledge. We are confident that they will be a force to be reckoned with in the Kenyan off-grid energy market.
2. Why we invested: Customer Centricity
What initially struck me in my first conversation with Anton Espira was his commitment to his customers. He had noticed that Solibrium’s customers were forced to purchase new products every time they wanted to upgrade their solar lighting systems. If you purchase a 3-light system and then two years later you decide you also want a television, you often need to purchase an entirely new system because the smaller system cannot support the increased load.
Solar home systems are not cheap, especially for customers from low income households. Solutions that are able to extend the lifetime of solar products and reduce costs for customers will not only reduce a significant financial burden on customers but also edge out more expensive alternatives. Furthermore, solar e-waste is an increasingly concerning problem in Kenya. There are a multitude of low-quality products with short lifespans flooding a market that has limited resources for managing the reuse and recycling of its waste products. Innovations that extend the lifespan of solar products will help reduce solar e-waste, mitigating the negative environmental impacts of these products.
Solibrium is using this loan to provide customers with higher quality products that are easily upgradable so that his customers will save more on their lifetime spending on energy. Rather than focusing on short term revenue potential, Solibirum’s team understands the challenges their customers face and is laser focused on creating customer value and building customer loyalty. We believe Solibrium’s approach, extending the lifespan of solar products and reducing their cost for customers, will have the furthest reach, biggest impact and ultimately outcompete inferior products. This is the ethos that will build trust among Solibrium’s customers and earn Solibrium loyal customers for life.
3. Why we invested: Community Based Approach
The vast majority of solar companies in Kenya are based in Nairobi, the nation’s capital, also known as the “Silicon Savannah” for its burgeoning entrepreneurial ecosystem. The concentration of large, foreign owned companies in the city make it difficult for local players to carve out their stake in the urban market. On the other hand, these large companies have a difficult time reaching remote consumers.
In contrast, Solibrium is committed to serving remote, poor and underserved communities. Breaking the mold, Solibirum is based in Kakamega, a 7.5 hr drive northwest of Nairobi. In this part of the country, there are few competitors with a strong local presence.
Solibirum is able to outpace its competitors in the region by having a strong local presence, which allows them to win over the trust and loyalty of more remote customers. Their proximity to rural consumers allows them to respond to customer needs more quickly and efficiently with repairs being completed in less than 48 hours. They also prioritise hiring sales agents that are embedded in the communities. The vast majority of their 700 person sales team grew up in the communities they work in, speak the local language and are best positioned to navigate the local context.
Solibrium’s community-driven approach has earned them the trust and confidence of the communities where they work, and we believe this will help them carve out a healthy slice of the Kenyan solar market.
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