Did SunCulture, a company that produced and sold solar-powered water pumps to Kenyan farmers represent a good investment opportunity for the PanAfrican Investment Company?
In 2015 the PanAfrican Investment Company, a New York-based venture capital fund focused on making impactful investments across Africa, considered investing in SunCulture. SunCulture, an early stage start-up in Kenya that produced and sold solar-powered water pumps to famers, was looking to sell a 20% equity interest in order to raise $750,000—$1 million. Despite having won a number of high-profile awards, SunCulture had taken on a family loan but had yet to raise any third-party investment funding. Although PIC was interested in the company, there remained significant challenges, including SunCulture’s historical dependence on grant funding and the relatively high price of its product. This case presents students with information about the country, the product offering, the competitive environment, and historical company financials, asking them to consider how PIC should vet SunCulture—taking into account both the opportunity for impact and the challenges to overcome—in order to determine whether it represented a viable investment.
Case ID: 200302