1.0 Background

The REACT 2.0 Regional Programme – Digital Innovation Fund for Energy & Climate (DIFEC) is a three-year Sub-Saharan Africa (SSA) initiative designed to unlock the potential of digital technologies to accelerate clean energy access, strengthen climate resilience, and improve enterprise performance across multiple African markets. DIFEC targets early-stage and growth-stage enterprises developing digital solutions under the DIFEC thematic areas – refer to Annex 1.

The programme operates two funding windows:

• Window 1 – Growing Digital Innovation (early stage, MVP to validation) and
• Window 2 – Scaling Digital Innovation (growth stage with commercial traction). 

DIFEC addresses structural barriers such as limited early-stage finance, fragmented markets, and regulatory complexity by providing catalytic grants, venture building support, technical assistance, investment facilitation, and ecosystem strengthening to build a pipeline of scalable, investable digital solutions. The programme emphasizes secure, resilient, and sustainable digital ecosystems—promoting secure by design approaches, responsible data governance, cybersecurity awareness, and alignment with GDPR and the AU Malabo Convention where applicable, especially when digital systems underpin essential services.

Key objectives include improving clean energy access, strengthening climate mitigation and adaptation, enhancing gender inclusion, promoting energy efficiency, and fostering replicability and cross-border scalability of digital innovations across SSA

2.0 Objective of the assignment

The objective of this assignment is to provide support in the evaluation and comprehensive due diligence on shortlisted applicants, covering business and financial aspects, to support the preparation of investment memos that inform final selection and grant award decisions. Specifically, the assignment seeks to:

• Assess the commercial viability, scalability, and sustainability of applicants’ business models, including market positioning, customer base, competitive advantage, and organizational capacity.
• Evaluate the financial soundness of the proposed projects, ensuring financial models, projections, and capital structures are robust, and identifying financial risks and mitigation measures.
• Integrate due diligence findings into clear recommendations through comprehensive reports and investment memos that outline eligibility, risk profile, readiness for funding, and proposed conditions for grant agreements.

3.0 Scope of the evaluation

The Consultant will conduct Business and Financial Due Diligence assessments for up to 15 shortlisted applicants. The assessment areas are outlined below.

 Business Due Diligence

The Consultant will conduct an in-depth review of each applicant’s business model, with particular attention to the commercial dimensions of digital products and services targeting energy and climate markets. Activities include:

1. Assess the viability, scalability, and sustainability of the business model, including an evaluation of the digital value proposition, target users, and problem-solution fit within the energy and climate context.
2. Evaluate market demand, competitive positioning, pricing strategy, and revenue streams, with consideration of the digital distribution channels and go-to-market approach.
3. Review customer acquisition strategies, user onboarding and after-sales support models, and the operational readiness to serve customers in low-infrastructure or underserved markets, including network coverage, device compatibility, localization, and user adoption barriers.
4. Assess organizational structure, management capacity, and governance, including the enterprise’s capacity to deliver and sustain digital products or services at scale.
5. Analyze the proposed pathways for regional scaling, including the solution’s adaptability to diverse regulatory and market environments across Sub-Saharan Africa.
6. Review digital partnership models, including integrations with energy service providers, climate-data platforms, last-mile distributors, or other ecosystem actors that underpin commercial viability.

Financial Due Diligence

1. Review historical financial statements to assess liquidity, profitability, solvency, and operational efficiency.
2. Evaluate the applicant’s financial model, including assumptions, projections, sensitivity tests, and reliability of inputs.
3. Analyze capital structure, current and projected cash flows, working capital needs, and funding adequacy.
4. Assess financial risks, sustainability of projected performance, and alignment with proposed REACT 2.0 financing.
5. Determine whether the project is financially viable and whether the request is justified.

Coordination with Other Due Diligence Specialists

This consultancy focuses on business and financial due diligence. The Consultant shall coordinate with other specialists responsible for:

1. Technical and digital due diligence, including technology architecture, cybersecurity, data governance, and digital risk;
2. Legal reviews including corporate structure, licensing, contracts, and regulatory compliance;
3. Environmental and social (E&S) risk assessments.

The Consultant will flag any commercial or financial findings with implications for other workstreams and participate in cross-disciplinary moderation sessions as required.

4.0 Approach and methodology

The consultant will apply a structured approach that combines desk review, financial analysis, field verification, and consolidated reporting, including, but not limited to, the items outlined below.

Desktop Review 

1. Review applicant submissions, including business plans, digital business model descriptions, financial models, historical financial statements, and supporting documents.
2. Conduct preliminary assessment of business model viability, revenue assumptions, and commercial strategy.
3. Conduct preliminary financial assessment, including review of projections, capital structure, and funding adequacy.
4. Assess alignment of the business and financial model with programme requirements and the digital energy and climate context.
5. Identify information gaps requiring clarification or on-site verification.

Business Model Review and Analysis

1. Assess the coherence and commercial credibility of the business model, including the digital value proposition, target market, and revenue model.
2. Evaluate the enterprise’s competitive positioning, go-to-market strategy, customer traction to date, and realistic growth trajectory.
3. Review partnership arrangements, distribution models, and operational capacity to deliver at scale in Sub-Saharan African markets.
4. Identify key commercial risks and dependencies, including market adoption risks, partnership risks, and scalability constraints.

Financial Model Review and Analysis

1. Assess the robustness, accuracy, and consistency of each applicant’s financial model.
2. Evaluate key assumptions, unit economics, sensitivity analyses, and financial sustainability.
3. Review liquidity, profitability, leverage, cash flow projections, and funding adequacy.
4. Identify financial risks and determine the viability of the proposed financing structure.

Site Visits, Interviews, and Verification 

1. Conduct field visits to verify operational capacity, infrastructure, and readiness.
2. Engage management, staff, and stakeholders to validate the assumptions underlying financial models and business plans.
3. Confirm compliance with technical and operational standards where applicable.

5.0 Deliverables

The consultant will submit the following deliverables:

Inception Report 

1. Methodology, workplan, tools, and interview guides.
2. Due within 5 working days of contract signing.

Draft Due Diligence Reports (one per applicant) 

1. Covering Business Due Diligence findings, including commercial viability, market positioning, scalability, and operational readiness.
2. Covering Financial Due Diligence findings, including financial health, model robustness, projections, and risk assessment.

Final Due Diligence Reports

1. Incorporating AECF feedback.
2. Submitted in required templates.

Investment Memos (one per applicant) 

1. Concise summaries of key findings, risk ratings, financial viability, and recommendations for the Investment Committee.

Presentation of Findings

1. Presentation to AECF REACT Portfolio and Internal Investment Review Committee upon request.

6.0 Reporting and Investment memo

The consultant will:

1. Prepare detailed due diligence reports consolidating findings across business and financial workstreams, including financial viability and risk ratings.
2. Produce concise investment memos using AECF templates, highlighting key risks, mitigation measures, and readiness for award.
3. Identify technical assistance needs for each applicant.

The assignment will be implemented over 20-30 working days, distributed across April to June 2026. All reports and memos will be prepared in English and submitted using an AECF-approved format

7.0 Qualifications

The assignment is to be undertaken by a qualified individual consultant or a team of individual consultants with multidisciplinary expertise covering business and financial due diligence.

The consultant should demonstrate:

• At least 8–10 years of experience conducting due diligence, transaction advisory, or investment assessments for the development of finance institutions, venture investors, private equity funds, or challenge funds.
• Proven experience in technology, digital innovation, energy access, climate technologies, or related sectors.
• Demonstrated experience assessing early-stage and growth-stage enterprises, including startups and digital platform businesses.
• Experience conducting due diligence assignments covering business and financial assessments.
• Experience working in Sub-Saharan Africa or emerging markets.
• Strong understanding of grant-funded programmes, blended finance instruments, or innovation challenge funds.

Required Skills and Expertise 

Business and Market Specialist

Responsible for assessing the business model and market viability. Qualifications and experience:

• Degree in business administration, economics, entrepreneurship, or related field.
• At least 8 years of experience in market analysis, venture development, or startup advisory.
• Experience evaluating business models, growth strategies, and scalability of technology companies.
• Familiarity with African innovation ecosystems and startup environments.

Financial Due Diligence Specialist

Responsible for assessing financial health and financial management capacity. Qualifications and experience:

• Professional qualifications such as CPA, ACCA, CFA, or equivalent.
• At least 8–10 years of experience in financial due diligence, financial analysis, or investment advisory.
• Experience reviewing financial models, capital structures, and financial projections for startups or SMEs.
• Familiarity with grant-funded projects, venture investments, or blended finance structures.
• Experience reviewing historical financial statements, cash flow projections, capital requirements, and funding adequacy.
• Ability to assess financial risks and recommend suitable financing structures, including grants and blended-finance instruments.

Additional Advantage

• Experience with early-stage SMEs, climate finance, or blended-finance instruments.

8.0 Proposal submission

Qualified individual consultants are invited to submit a proposal that includes the following:

• A comprehensive description of the consultant’s understanding of the Terms of Reference, indicating any major inconsistency or deficiency in the Terms of Reference, and proposed amendments. Methodology and work plan for performing the assignment.
• A complete work plan for the entire review period.
• Detailed reference list indicating the scope and magnitude of similar assignments. Include signed reference letters from 3 previous institutions/programmes.
• Relevant services that have been done in the past five (5) years.
• The technical and financial proposals are to be submitted separately in PDF format. NO LINKS or Zip Files
• The financial proposal (in USD) clearly shows the budgeted cost for the work to be conducted under the scope of the work above.

All documents related to the technical proposal must be combined into a single document with a clear table of contents.

N/B: SUBMITTING THE FINANCIAL AND TECHNICAL DOCUMENT AS ONE DOCUMENT WILL AUTOMATICALLY LEAD TO DISQUALIFICATION OF THE APPLICANT.

9.0 Pricing

The AECF is obliged by the Kenyan tax authorities to withhold taxes on service contract fees and to ensure that VAT is charged where applicable. Applicants are advised to ensure they have a clear understanding of their tax position under Kenyan tax legislation when developing their proposals.

10.0 Evaluation criteria

Mandatory Requirements for individual consultants:

1. Passport/National Identification of the consultant.
2. CV demonstrating relevant qualifications and experience.
3. Valid Tax Compliance certificate (where applicable).

N/B: FAILURE TO ATTACH AND ADHERE TO THE ABOVE REQUIREMENTS WILL RESULT IN AUTOMATIC DISQUALIFICATION

An evaluation committee will be formed by the AECF and may include employees of the businesses to support. All members will be bound by the same standards of confidentiality. The consultant should ensure that they fully address all criteria for comprehensive evaluation.

The AECF may request and receive clarification from any consultant when evaluating a proposal. The evaluation committee may invite some or all of the consultants to appear before it to clarify their proposals. In such an event, the evaluation committee may consider such clarifications in evaluating proposals.

In making the final selection of a qualified bidder, the technical quality of the proposal will be weighted 70% in the evaluation. Only the financial proposal of those bidders who qualify technically will be opened. The financial proposal will be assigned a weight of 30%, and all proposals will be ranked by total points.  The mandatory and desirable criteria against which proposals will be evaluated are identified in the table below.

11.0 Application details

The AECF is an Equal Opportunity Employer. The AECF considers all interested candidates based on merit without regard to race, gender, colour, national origin, religion, sexual orientation, age, marital status, veteran status, disability, or any other characteristic protected by applicable law.

• Interested consultants are requested to submit their technical and financial proposal via the eprocurement portal https://procurement.aecfafrica.org/ by 8^th May 2026, 5 pm (EAT).
• All questions should be directed to the procurement email aecfprocurement@aecfafrica.org by 30th April 2026, 5 pm (EAT).
• The subject of the email should be “COMMERCIAL EXPERT (BUSINESS & FINANCIAL DUE DILIGENCE) FOR REACT 2.0 REGIONAL DIGITAL INNOVATION FUND FOR ENERGY & CLIMATE (DIFEC).”
• The AECF shall not be liable for not opening proposals submitted with a different subject or for not responding to questions that did not meet the indicated deadline.

12.0 Disclaimer

AECF reserves the right to determine the structure of the process, the number of short-listed participants, the right to withdraw from the proposal process, the right to change this timetable at any time without notice, and reserves the right to withdraw this tender at any time, without prior notice and without liability to compensate and/or reimburse any party.

The AECF does not charge an application fee for participation in the tendering process and has not appointed any agents or intermediaries to facilitate applications. Applicants are advised to contact the AECF Procurement Department directly.