IFC Commits $6 Million to Catalyst Fund to Accelerate Africa’s Climate-Tech Innovation
The International Finance Corporation (IFC) has proposed an equity investment of up to $6 million in Catalyst Fund, an Africa-focused climate-tech venture vehicle aimed at supporting early-stage startups driving sustainable innovation across the continent.
The move aligns with IFC’s broader agenda to strengthen climate resilience and sustainability in emerging markets by enabling private-sector-led solutions. The investment, if approved, will contribute to Catalyst Fund’s target of raising $40 million for climate-focused technology ventures in Africa.
Catalyst Fund’s Mission and Scope
Managed by Catalyst Impact Partners, Catalyst Fund supports startups developing technologies and business models that address Africa’s most pressing climate challenges. The fund focuses on three primary verticals:
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Fintech for Climate Resilience – Solutions that help individuals and small businesses manage financial risks tied to climate change, such as weather insurance or adaptive financial products.
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Sustainable Livelihoods – Innovations that enhance agricultural productivity, land restoration, and income generation in vulnerable communities.
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Climate-Smart Essential Services – Startups delivering clean energy, water, sanitation, and waste management solutions with scalable business models.
Catalyst Fund plans to operate across multiple African markets including Nigeria, Kenya, Egypt, Tanzania, South Africa, Morocco, Senegal, Mali, and Uganda.
Transition from Grants to Equity Investment
Originally launched as a grant-based accelerator, Catalyst Fund transitioned in 2023 into a full-fledged venture capital vehicle. The new structure allows it to take equity stakes in startups, supporting them with both capital and operational expertise to scale commercially viable climate-tech solutions.
This shift reflects a growing trend among impact investors and development finance institutions to focus on market-based climate adaptation, combining profitability with measurable environmental outcomes.
IFC’s Broader Climate Strategy
The investment forms part of IFC’s broader commitment to boost climate finance in emerging markets, particularly in Africa, where climate change impacts are intensifying. IFC has been working to channel capital into technologies that can strengthen adaptation, mitigate emissions, and promote green job creation.
By backing Catalyst Fund, IFC aims to de-risk early-stage climate-tech investments and attract additional private capital into the space. The funding is expected to enable Catalyst Fund to expand its pipeline of startups developing innovations such as renewable energy access platforms, sustainable agriculture tools, and climate data solutions.
Expected Impact
The partnership is expected to provide early-stage African entrepreneurs with access to much-needed funding, technical assistance, and investor networks. With the additional support from IFC, Catalyst Fund will be positioned to scale solutions that can enhance climate resilience across vulnerable sectors like agriculture, infrastructure, and clean energy.
The proposed investment is currently under review and pending final approval by IFC’s board.
