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Greening the Silicon Savannah

Palo Alto and Bangalore may soon have to make room for Nairobi at the top of the tech startup world. Kenya, the setting for such success stories as M-PESA, is making a name for itself as the center of the “Silicon SavannahWanted: entrepreneurs who are primed to make waves in climate tech. (Credit: International Rivers, Flickr Creative Commons)”. This growth is supported by incubators, investment and policy – an ecosystem of actors committed to capturing opportunities in a promising field.

Today, the Climate Innovation Center (CIC), the first of its kind in the world, opens its doors to Kenyan startups hoping to also make waves in climate technology sectors. infoDev’s feasibility studies estimate that such companies can create up to 4,600 direct and indirect jobs over 5 years and over 24,000 within 10 years, but they require substantial support to realize this potential. To this end, the World Bank’s infoDev, in partnership with the governments of Denmark and the UK, engaged with Kenyan entrepreneurs, policymakers and financiers to determine what climate technology ventures need in order to flourish as their counterparts in other industries have done. In short, they seem to be: financing, business advisory services , networks and policies that support innovative entrepreneurship.

In my conversations with Edith Botto of Botto Solar, she lamented that “there are no products tailor made by financial institutions to promote renewable energy products.” She went on to explain how this affects both buyers and sellers: “Our biggest target market of private and public institutions (like schools and universities), that purchase our energy-saving stoves and other energy-efficient products are not able to afford these products upfront. This makes us finance some of these projects from our own internal resources, which strains business operations and growth.” Grants and investments from the CIC will alleviate these constraints, while its business advisory services will assist firms in finding the best processes and models to bring their products to market.

It is also clear that Kenyan entrepreneurs value the support and convening power of the CIC.  “It is necessary to customise technologies for the African market given the lack of infrastructure,” says Jon Bøhmer, winner of the 2009 Financial Times Climate Change Challenge. “The center will make it easier to network with investors, government and other stakeholders, and being a CIC member also raises our company profile and gives us extra credibility and visibility.” Bøhmer’s current venture, Kyoto Energy, seeks support from the CIC in perfecting and commercializing its design for a low-cost solar generator.

The CIC will assist innovations that leverage indigenous resources, manpower and expertise. For example, LaTerre Clean Energy in Naivasha is using waste from Kenya’s flower industry to produce biomass for electricity generation. LaTerre’s founder told me that while he appreciates the networking opportunities the CIC will provide, he anticipates that it can potentially make an impact on the policy level:

“The CIC provides a great forum for establishing a network of climate innovators, collaborators and advisors across multiple industries and disciplines,” notes LaTerre’s Alistair Nicklin. “This platform will be helpful in lobbying for governmental policy change [and] reform on various aspects of the energy sector, permitting guidelines, financing options and maintaining momentum to provide sustainable solutions for climate change innovations.”
 Botto, Bøhmer and Nicklin are but a few examples of the enterprising minds wishing to create jobs and profits in Kenya. But just as importantly, they also want to deliver sustainable solutions in energy access, transport, water, and agriculture – ensuring that the Silicon Savannah will be green and thriving for generations to come, and inspiring us at infoDev to support them as they pursue that mission.

The Kenya CIC will be seeded by a contribution of USD 15 million over five years and hosted by a consortium of partners led by the business school at Strathmore University. In addition to technical assistance and business incubation, the center will also house a Seed Capital Facility and the East Africa Climate Innovation Network, creating a one-stop shop for climate technology innovators.