The Dutch development bank FMO has approved a €2.5m development contribution to support early-stage climate tech startups backed by the Persistent Africa Climate Venture Builder Fund (ACV Fund), a new closed-ended vehicle managed by Persistent Energy Capital LLC.
The grant will capitalise a dedicated Venture Building (VB) Facility within the fund — a ring-fenced, grant-based structure designed to provide hands-on operational and strategic support to 25–30 clean technology companies across Sub-Saharan Africa.
Building a bankable pipeline
The VB Facility will deliver pre- and post-investment support to startups operating in sectors including distributed solar, energy efficiency, electric mobility, agritech and circular economy solutions. Support will cover finance and legal structuring, governance, ESG integration, reporting systems and milestone tracking — areas that development finance institutions (DFIs) often cite as weak points in early-stage African ventures.
FMO says the objective is to improve financial performance, investment readiness and scalability among early-stage companies, while strengthening climate mitigation and gender outcomes. The project is classified as “Climate Mitigation (principal)” and “Gender (significant)” under FMO’s internal labelling framework.
Early-stage climate ventures in markets such as Nigeria, the Democratic Republic of Congo, Ethiopia, Ghana, Senegal, Côte d’Ivoire, Kenya and Cameroon face structural constraints, including limited access to equity capital, shallow technical talent pools and high perceived risk. Several of these markets are categorised as low-income countries (LICs) or fragile and conflict-affected situations (FCAS).
By separating venture building activities from the fund’s commercial capital, FMO argues that its grant delivers “financial additionality” — funding advisory and ecosystem-building services that private investors are unlikely to finance on a standalone basis.
The ACV Fund has already secured backing from the African Development Bank, which in 2024 committed $10m through its Sustainable Energy Fund for Africa (SEFA). That investment is intended to help mobilise up to $70m in total capital for African climate ventures.
According to projections shared by the fund, the portfolio could contribute to the deployment of 200MW of renewable energy capacity, extend energy access to more than 420,000 households and 31,000 businesses, avoid roughly 17m tonnes of CO₂e emissions and support the creation of over 66,000 jobs. As with most impact forecasts at fund level, these figures depend on successful deployment and follow-on capital.
SEFA, a multi-donor special fund housed at the African Development Bank, provides concessional finance and technical assistance to crowd in private investment into renewable energy and energy efficiency projects. Its mandate aligns with Sustainable Development Goal 7 on universal energy access.
A venture builder model
Founded in 2012, Persistent positions itself as a climate-focused venture builder rather than a traditional venture capital firm. The company provides early-stage equity alongside operational support, particularly in off-grid solar and e-mobility. It says it has managed or advised on more than $265m in climate-related assets across advisory mandates and balance-sheet investments.
The venture builder model — which combines capital with embedded operational expertise — has gained traction in African climate tech, where founders often require deeper hands-on support than peers in more mature ecosystems.
Persistent’s investment criteria are aligned with the 2X Challenge framework on gender lens investing, and the VB Facility will include targeted support for women-led and women-managed enterprises.
For FMO, the grant sits within its 2030 strategy and Market Creation Programme, which aims to strengthen local investment ecosystems and reduce structural barriers to private capital.
DFIs have increasingly sought to improve the “pipeline quality” of early-stage companies before they reach institutional investors. In climate tech — where hardware risk, regulatory complexity and long payback periods are common — that gap is particularly acute.
Whether the ACV Fund can convert grant-funded venture building into commercially scalable exits will be closely watched. What is clear is that development finance institutions are doubling down on blended structures to address Africa’s early-stage climate funding gap — combining concessional support with equity capital in an attempt to make the numbers work for both impact and returns.