Novastar Ventures Raises $147 Million for Sustainable Growth Across Africa

Established venture firm Novastar Ventures has successfully closed its Africa People and Planet Fund III at $147 million. While slightly below the original $200 million target, this represents a significant 40% expansion from their previous fund.

Since launching in 2014, Novastar has grown to manage over $200 million across offices in Lagos and Nairobi. Fund III extends their geographic reach beyond East and West Africa to include North and South Africa, with initial investments already made in companies like Breadfast (Egypt) and Chowdeck (Nigeria).

The portfolio reflects a strategic focus on climate and sustainability sectors aligned with everyday consumption, urban mobility, and cleaner energy access—including electric vehicle solutions, device financing, and biogas infrastructure.

Addressing the Climate Finance Gap

Africa faces an estimated $2.8 trillion funding shortfall between 2020 and 2030 to meet climate goals. Novastar’s fund aims to address this gap by providing equity capital in sectors where private investment has been cautious due to currency risk, political instability, and limited exit opportunities.

The commitment from the Green Climate Fund at $40 million serves as anchor capital, helping de-risk the vehicle for other investors—a common catalyst in African venture deals.

Japanese Investors Back Sustainable Vision

A notable feature of Fund III is participation from several Japanese corporations and institutions, including SMBC, MOL, Mitsubishi Corporation, SBI Investment, and JICA. This marks a growing interest in Africa’s sustainability economy beyond traditional infrastructure investments.