Electric two-wheelers (E2Ws) are beginning to be cost-competitive across Africa. Yet there is no dedicated capital source to help local and regional EV companies grow at the corporate level, nor is there a dedicated project or asset finance source to help scale necessary pilots and ancillary infrastructure. The E2W Africa is a pioneering financing platform that would address the lack of sizable growth equity capital to move from Seed and Series A to multi-country second-stage Series B growth. 

E2W will focus on over US$ 5 million investments in growth equity and small-scale asset finance around 2-wheelers, 3-wheelers, charging or swapping infrastructure to overcome the charging infrastructure obstacle, and small-scale manufacturing, primarily final assembly. By providing growth capital, both debt and equity, it can create a founder-friendly finance instrument to help grow this asset-heavy industry.

E2W Africa aims to address barriers to the rapid scaling of electric two-wheelers:

• Limited asset and growth finance;

• Cash constraints related to importing;

• Sufficient equity buffer to weather the negative cash flow in the early years of deployment and building of generation, charging, and battery infrastructure.

Blended finance will be used at both AssetCo and DevCo as per the figure below, but the AssetCo structure (debt) is the focus of this piece of work for which CAP funding is requested.

How does it work?