⚡ Revolutionizing Public Transportation in Africa

Podcast’s Essential Bites:

[4:56] JB: “[BasiGo is] a company that's looking to bring electric public transit to Sub-Saharan Africa. […] Introducing this technology into this part of the world is particularly impactful from a climate perspective.“

[5:57] AR: “[Moxxie VC is] a seed stage venture capital firm. We invest globally, predominantly the United States […]. We're a generalist firm, but really interested in climate tech. […] We invested in BasiGo in the recent round.”

[7:08] JB: “E-mobility is just getting started in East Africa. And most of the focus has been on micro mobility. But while I was working as an investor, I was really interested in how this could be applied to buses or what we call public service vehicles here. […] We are a bus dominated culture here in Sub-Saharan Africa. […] We don't have a formal bus sector. It's a private sector market that really is now growing up into being a bus sector. It started as these minibus taxis […] and now it's becoming a formalized bus sector. […] When you're driving behind them, at any given moment, you will find that you're just flooded with black smoke. That's because these are diesel buses and oftentimes, the particulate emissions filters are just cut off in order to improve fuel efficiency. […] The toxic air pollution from them is just [really] bad.”

[8:56] JB: “Unlike places like India and China, where […] transit has been electrified, […] there's a problem. These cities that China is electrifying transit in, they're surrounded by coal plants. But here in Kenya, […] we have the benefit of 90% of our electricity already comes from renewables. […] If we electrified transit here, it would have a greater marginal impact on climate emissions and that air pollution problem than almost anywhere else in the world.”

[12:39] AR: “The biggest companies are built from solving real problems. And we tend not to invest in areas that to me look more like solutions looking for problems. Climate is the number one problem facing the whole planet. Not only that, […] but […] refugee flows, war, access to water, housing insecurity, food insecurity, the widening rich-poor gap, all of that gets worse with climate change. So this is the biggest problem that we're facing. And it also touches every single part of the economy. […] We think this is just a massive economic opportunity.”

[16:49] JB: “There's over 20,000 buses in the city of Nairobi alone. […] Every single bus that we can displace with electricity, because the grid is so green, would mitigate 50 tons of CO2 per year of operation. […] Africa right now is home to six of the fastest growing economies in the world. […] We talk a lot about how Africa is only 3% of global emissions. […] And yet, what we know is that Africa is growing so fast, it is going to become the China and India of the next decade. If we don't solve the emissions problem now, something the world has never done before, which is find a true path to sustainable development. All we're doing is kicking this can down the road. And we're going to be facing another emissions crisis from emerging markets like Africa in 10 years.”

[26:18] JB: “In 2021, 50% of the electricity generated in Kenya came from geothermal. […] But not just in East Africa, also in places like West Africa, there are heavy reserves of renewables. […] And, by the way, we have an under consumption problem. So all these renewables on the grid, at night we have massive oversupply. These renewables get burned away, because not enough people and industry and factories are actually consuming electricity at night. And so if we actually pull this business model off, we're solving two problems at once. We're mitigating emissions and air pollution, but at the same time, we're actually bolstering the utilities here, which is a good thing, because a lot of the utilities in Sub-Saharan Africa are struggling.”

[27:31] JB: “[BasiGo can enter the market now, because of] the confluence of three trends. The first trend is the reduction in cost of batteries and then the resulting reduction in cost of electric vehicles. The cost of something like an electric bus has fallen 50% since 2010. […] So the second is this problem of financing. But one of the things that we have seen here in Sub-Saharan Africa across the renewable energy sector is that if you bring financing to bear, if you can move some of the Capex over to Opex, and actually provide a net economic benefit, then there is a market that is hungry to adopt these renewable technologies and these clean technologies. […] And then the third is, when you're talking about something like buses and passenger cars, you're talking about now working with the global OEMs, who are producing these vehicles. […] The electric vehicle market here is nascent. The leading manufacturers who are providing this market are folks like […] Toyota. These are not companies that have been pushing EVs. […] And that's frankly, where we come in. The people who combine the technical expertise around electric vehicles, with the financing expertise to actually pull off a business model like this.”

[35:58] JB: “At our core, […] we're a software enabled financing company. […] We weren't trying to invent a new electric bus, we weren't trying to be a huge manufacturing company. We are fundamentally a commercial electric vehicle finance company, powered by software, especially around battery management and battery prediction. And so along those lines, we're basically proving our model, proving the demand exists for the product and then proving that repayment rates and everything that we need in order to prove that financing model is going to match what we've been projecting. And then from there, ideally, take this to scale.”

[46:44] JB: “We found that almost 80% of operations here can be met with 250 kilometers of range in a given day. […] 80% of the buses here in Nairobi can work from 5am till about 10 or 11pm, without having to stop to charge. And if you do that, then you'll have implemented zero behavior change, because they're basically bringing the bus back at the end of the day, we recharge our bus in less than four hours, and yet we have six hours to charge. […] The goal is to address that 80% of the market as a starting point with that 250 kilometers of range.”

Rating: ⚡⚡⚡⚡

🎙️ Full Episode: Apple | Spotify | Google (Original Title: "Startup Series: BasiGo")
🕰️ 56 min | 🗓️ 03/31/2022
✅ Time saved: 54 min

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