Market Overview: Energy Startup in Western Africa
As part of the due diligence service Fundie provides startups, our analysts create market analyses relevant to each startup. This article is based on a market analysis created for a social impact startup working on waste-to-energy business in Ivory Coast. Analysis written by David Fuente, Antony Roos, and Zhi Xiang Chen.
Recently, our team performed a business plan analysis of an Ivory Coast startup working in the waste-to-energy market. This startup aims to produce fertilizer, electricity, and biogas utilizing waste as inputs.
The specific startup we analyzed has a three-person leadership team, and the larger team consists of 15 industry professionals with backgrounds in science and engineering. The startup is still in the early stages of business growth, having received small grants and awards from various energy competitions. Currently, they generate revenues from their consulting services (focused on environmental studies) in order to further develop the core of their business.
Their business model operates in two market spaces, business-to-business and business-to-consumer. The business-to-business operations are expected to be their main revenue stream, attracting small and medium-sized enterprises (SME’s) through cost savings and waste reduction. However, as of March 2018, the startup had only started preparations for the distribution of 20 pilot B2C products to households with the goal of installing 100 units by year-end 2018. Their B2C product provides a social good to families and households in need of the fertilizer, electricity or biogas generated from the waste. Their core business, the B2B model, is still in the research phase and is expected to complete during the second half of 2018.
The startup operates in a high growth market with no direct competitors, with the potential to reach a high volume of households because 60% of them are off-the-grid. Their product reduces costs of gas, electricity, and fertilizer for households, which provides a huge benefit because monthly salaries in Ivory Coast averages only €300. However, traditional market research has to be done in order to accurately determine which market space to penetrate, the size of the potential market, and anticipate the appropriate demand for their products. Additionally, the startup needs to begin targeting small cities or towns and contact various businesses within to gauge demand for its B2B product.
