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Acumen exits KopaGas

Anna Lyudvig
July 7, 2020, 2:50 p.m.
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Word count: 460

Acumen, a non-profit impact investment fund, has exited its stake in a Tanzanian-based clean cooking company KopaGas, following Circle Gas acquisition.

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Acumen, a non-profit impact investment fund, has exited its stake in a Tanzanian-based clean cooking company KopaGas, following Circle Gas acquisition.

KopaGas was founded in 2014 to bring clean cooking solutions to Tanzania, where, at the time, 96% of citizens—or 45 million people—were using dirty fuel like charcoal and wood for cooking.

With its trademarked pay-as-you-go LPG technology, KopaGas made LPG affordable to low-income Tanzanian households for the first time. With funding from grantors like GSMA, the Department for International Development (DfID) and MIT D-Lab, the company developed a smart meter technology that enables customers to buy as much or as little LPG as fit their needs and budgets with mobile money. 

Acumen recognized KopaGas’s potential for impact and invested early-stage equity in the company in 2018.

Since investing, Acumen has supported KopaGas through a seat on the company’s Board, providing a technical assistance grant, and informing its product design with a Lean DataSM customer survey.

“Despite the potential for outsized impact, many impact investors have shied away from clean cooking. We’re proud to back innovators like KopaGas that are proving the viability of scalable, profitable business models and can fundamentally improve health outcomes and financial savings for the poor,” said Acumen East Africa Director Shiru Mwangi.

KopaGas brought its proof-of-concept to market and has now connected 1,300 low-income households to LPG-fueled clean cooking, impacting 6,500 lives.

In January, Circle Gas acquired KopaGas’s technology in a $25m transaction—the largest-ever pure private equity investment in the clean cooking sector.

Sebastian Rodriguez, KopaGas Co-Founder and CEO, said: “The investment in clean cooking solutions required to match the scale of the problem are several orders of magnitude of what we have today. We are grateful to find in the Circle Gas team the vision and expertise required to crystallize the KopaGas vision and improve access to clean cooking for millions.”

Acumen has been backing cookstove innovations with pioneer patient capital since 2015.

In the last five years, the firm has invested a total of $6.2m in five clean cooking companies across Kenya, Tanzania, Nigeria and India, helping to unlock $14.4m in follow-on capital for these companies.

As Acumen turns to recycling the capital from this exit and investing in the next early-stage, high-potential innovation, Acumen is forming a new partnership with the DfID-funded Modern Energy Cooking Services (MECS) Program.

This program aims to  accelerate the transition from biomass-based cooking to modern, clean, low-carbon energy-efficient alternatives. Acumen will support investments in the electric cooking, LPG, Ethanol or Biogas sectors designed to catalyze the growth of this nascent sector.

For example, with few off-grid-enabled e-cooking appliances yet on the market, Acumen will provide Technical Assistance grants to energy investees in East and West Africa to develop and pilot distribution of  e-cooking appliances for off-grid, low-income households.

 

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