Breega’s Post

Africa's Startup Surge: A Year of Record-Breaking Growth and Enduring Challenges Africa's tech scene continues its meteoric rise, captivating the world with its potential for innovation and disruption. 2023 proved a pivotal year, marked by exhilarating leaps and sobering stumbles. Let's delve into the data and unveil the story of African startups in this year of record-breaking growth and enduring challenges. Growth Spurt: 📍VC funding soared to a record high of $4.4 billion, a 35% jump from 2022. (Partech Africa) 📍The number of active tech startups crossed 7,000, a 20% increase. (GSMA) This booming ecosystem is projected to create 3.5 million jobs by 2027. (Briter Bridges) 📍Fintech reigned supreme, attracting 31% of all VC funding ($1.4 billion) with its focus on financial inclusion and digital payments. (Partech Africa) 📍Clean energy startups saw a 50% surge in investments, reaching $600 million, fueled by the continent's renewable energy potential. (BloombergNEF) Market Potential: Africa boasts the fastest-growing middle class globally, which is expected to reach 2.6 billion by 2030. Mobile internet penetration is projected to touch 50% by 2025, creating a vast market for mobile-based solutions. (GSMA) Africa presents immense investment opportunities, with a projected GDP growth of 4.7% over the next five years. (World Bank) Investor Optimism: 60% of investors plan to increase their African startup investments in 2024, signaling continued confidence in the continent's potential. (Briter Bridges) Global giants like Google Ventures, Facebook Ventures, and SoftBank actively invest in promising African startups. Challenges Remain: Talent gaps, limited access to finance, and inadequate infrastructure pose significant hurdles. Navigating diverse regulatory landscapes across African nations can be complex. Resilience and Ingenuity: Despite these challenges, African entrepreneurs are forging ahead with innovative solutions and strategic partnerships. The rise of mini-grids and off-grid energy solutions is a testament to their commitment to providing energy access to underserved communities. The future of Africa's startup ecosystem hinges on collaboration. Governments, investors, entrepreneurs, and the international community must come together to create a supportive environment, address critical challenges, and unlock the full potential of this dynamic ecosystem. #startupecosystem #Africa

Having crisscrossed this vast continent, from the bustling markets of Lagos to the tech hubs of Cape Town, I've witnessed firsthand the resilience, creativity, and sheer determination of African founders. In these transformative times, as we stand on the cusp of 2024, let me share with you why investing in African founders is not just a wise choice—it's an imperative. The African Renaissance: A Continent in Flux Our population is surging, with projections indicating that by 2050, one-third of Africans will be under 35. This demographic wave offers immense opportunities for startups to cater to a booming market. But it's not just about numbers; it's about the spirit of possibility that permeates the air—the belief that tomorrow can be better than today. The African Entrepreneurial Spirit Picture this: A young entrepreneur in Accra, armed with a laptop and a dream, building an e-commerce platform that connects artisans from Mali to Morocco. Or a health tech startup in Lagos, leveraging telemedicine to bridge the healthcare gap in rural communities. These stories are not outliers; they are the heartbeat of Africa's entrepreneurial ecosystem. Why African Founders? 1. Resilience: African founders thrive amidst adversity. They navigate power outages, bureaucratic hurdles, and infrastructure gaps with unwavering determination. When the road ends, they build bridges. 2. Local Insights: African founders intimately understand their markets. They know that mobile money is more than a buzzword—it's a lifeline for millions. They grasp the nuances of cultural diversity, tailoring solutions that resonate with local communities. 3. Innovation: From fintech to agribusiness, African startups are rewriting the playbook. Take BezoMoney (Techstars ‘23) in Ghana, revolutionizing digital banking for the underbanked. Some Key Deals and Lessons from 2023 1. Founders Factory Africa: In 2023, they invested in startups like Lipa Later Group, KudiGo Inc, and Eazyhire. These deals taught us that collaboration between traditional financial institutions and nimble startups can yield powerful results. 2. Google for Startups Fund: The 2023 cohort included Akoma Health, BezoMoney (Techstars ‘23) and Chargel. These startups, led by visionary African entrepreneurs, received non-dilutive cash awards, Google Cloud credits, and mentorship. Their impact on healthcare, fintech, and logistics is profound. 3. Visa Accelerator: Visa has selected 23 African startups for the inaugural cohort of its Visa Africa Fintech Accelerator including Amazing Startups like Chari and Weego. Looking Ahead: 2024 and Beyond As we step into 2024, expect even greater strides. Waste-to-energy plants will rise, addressing Africa's waste crisis. Agri-tech will flourish, connecting small farmers to global markets. And blockchain will empower transparency and trust. Investing in African founders isn't just about returns; it's about shaping a brighter future. 💙 Cole

Funding Freeze Frigid for African Startups: Boom Goes Bust, Some Battle On African tech's boom times are officially on ice. 2023's "funding winter" has frosted over VC coffers, and the "startup graveyard" is filling up faster than anyone likes. Let's have a look at the casualties and survivors. The Bad News: Some of the African Startups that closed their doors this year owing to the funding freeze include Sendy, 54gene, Dash, WhereIsMyTransport, Lazerpay, zumi, Zazuu,Hytch, OkadaBooks, and Pivo – all shutdown, frozen by funding chills. Growth grinds: Copia Global retreats from Uganda, MarketForce scrambles for cash, Twiga Foods juggles debt amid new investment. Most of these implications were ignited by global trends. Funding has halved globally, and African tech is down 48% year-on-year. Fast-growth "burn at all costs" strategies hit hardest. While casualties bore the brunt, survivors are also adapting to the new wave. Paystack refocuses on Africa, while others pivot, innovate, and squeeze out learners. All this is a test of resilience: Can African startups weather the storm and emerge stronger? 2024 might hold answers. Once abuzz with optimism, the African tech scene faces a harsh reality check. But amidst the closures, there's also grit and determination. The continent's tech story isn't over yet – it's just rewriting its chapters in a colder climate. #startup #funding

The POLL results are out 👀 The winner is... 𝐊𝐞𝐧𝐲𝐚! The most funded African country of 2023 is also where most of our LinkedIn community comes from! Let's take a tour around Africa, starting with Kenya (based on 2023 data): 🚀 𝐆𝐫𝐨𝐰𝐭𝐡 Despite a decrease in the number of startups funded, Kenya's tech sector showed remarkable resilience in 2023. The total funding surged to an impressive $673.78 million, marking a 17.2% increase from the previous year, and accounting for 28% of Africa's total funding. 🌱 𝐒𝐞𝐜𝐭𝐨𝐫-𝐒𝐩𝐞𝐜𝐢𝐟𝐢𝐜 A substantial portion of the funding was dominated by energy startups, with M-KOPA and Sun King raising over $465 million. This propelled the average deal size in Kenya to $10.87 million, a significant rise from $6.32 million in 2022. This sector alone contributed 74.2% of the total funding, showcasing a strong focus on sustainable and renewable energy solutions. 🌍 𝐃𝐢𝐯𝐞𝐫𝐬𝐢𝐭𝐲 Kenya also demonstrated strong gender diversity and inclusion, with 41.9% of the funded startups having at least one female co-founder, and 22.6% led by a female CEO. This outpaces many other regions, emphasizing Kenya's commitment to inclusive economic growth. 📈 𝐄𝐦𝐩𝐥𝐨𝐲𝐦𝐞𝐧𝐭 𝐚𝐧𝐝 𝐄𝐜𝐨𝐧𝐨𝐦𝐢𝐜 𝐈𝐦𝐩𝐚𝐜𝐭 The startup ecosystem not only attracted funding but also created substantial employment, with 9,517 people employed across various startups, averaging 154 employees per company. This is a sharp increase from 88 employees per startup in 2022, indicating robust growth and the expanding impact of these enterprises. 🌟 𝐋𝐞𝐚𝐝𝐢𝐧𝐠 𝐒𝐞𝐜𝐭𝐨𝐫𝐬 While energy startups led in funding, the fintech sector saw the most startup activity, with 16 fintech companies funded. This was followed by e-commerce and agritech, showing a vibrant mix of sectors thriving in Kenya's market. 📊 What do you think drives the unique success of Kenya's tech ecosystem, especially in sectors like energy and fintech? #dreamvc #venturecapital #africa #kenya #startups (Source: Disrupt Africa, Partech, and Startup Stash)

Kenya's startup funding accounted for 28% of startup funding in Africa in 2023! Kenya managed to raise $673.78 in startup funding, representing a 17.2% increase in funding from 2022. Kenyan startups have employed more than 9,517 people. Energy startups led in funding in 2023 but fintech, e-commerce and agritech startups respectively saw the most activity. Interesting statistics for the Kenyan startup scene 👏🏾

AFRICA TREND: Technology Landscape Dynamics – Wasoko Highlight African tech startups raised US$4.8 billion across 1,000 deals in 2022, which is a considerable increase from US$4.33 billion across 820 rounds in 2021. However, in the first half of 2023, African tech startups raised only US$1.19 billion, which is down by more than half of the total from the corresponding period in 2022. Global economic slowdown, rising inflation, ongoing war in Ukraine and tightening monetary policies have contributed to the decline in funding. Despite the slowdown, startups such as Wasoko, known as "people of the market" in Swahili, are one of Africa's rapidly growing startups. The company links small retailers with manufacturers or large distributors, creating a beneficial system for all parties. Leveraging technology, Wasoko distributes goods to countries such as Kenya, Rwanda, Uganda, Tanzania, Zambia and the Democratic Republic of Congo. Last year, investors infused Wasoko with US$125m in a Series B round, marking the highest funding for a non-fintech African startup. There are still some bright spots in the African tech ecosystem with South Africa, Kenya, Nigeria and Egypt leading funding rounds in 2022, making up 75% of total investments. Contact Lynne Martin at [email protected] if you are interested in opportunities on the continent. #helpingafricagrow #tech #startup #market #dynamics

There's a quiet shift underway across Africa's tech ecosystem. While Africa-focused investors have generally focused on four main hubs — Nigeria, Egypt, Kenya, and South Africa — Francophone Africa continues to rise, slowly but steadily. Last year, startups in Francophone Africa accounted for 15% of all equity raised by Africa-focused startups — up 3x from five years ago. Read more about the emergence of Francophone Africa in this brief article that also spotlights 28 founders building tech companies in/from French-speaking Africa. __________________ 🚨 Afridigest is the intelligent guide to #tech in #Africa that's trusted by tens of thousands of founders, investors, and executives from Cairo to Capetown, Lagos to Lusaka, and around the world. Subscribe to the newsletter today as a free reader or paying subscriber to get smarter about tech in Africa: afridigest.com/subscribe.

Here's a recap/roundup of what happened in Week 35 2023 (August 27 - September 2) across #Africa's tech and startup ecosystem: 𝗦𝗧𝗔𝗥𝗧𝗨𝗣 𝗙𝗨𝗡𝗗𝗥𝗔𝗜𝗦𝗜𝗡𝗚 • Seven deals were announced for a total of ~$7M in disclosed funding this week. 𝗜𝗡𝗩𝗘𝗦𝗧𝗢𝗥 𝗔𝗖𝗧𝗜𝗩𝗜𝗧𝗬 • Los Angeles-based Black Ostrich Ventures announced the launch of a $20M-target pre-seed and seed-stage fund focused on African startups in the cleantech, supply chain, ag-tech, and edtech sectors across Tanzania, Zambia, Morocco, and Uganda. (Ajani Windsor-Areago) 𝗡𝗘𝗪𝗦 𝗢𝗙 𝗧𝗛𝗘 𝗪𝗘𝗘𝗞 • Uber launched an electric bike fleet in Kenya, its first in Africa. (Electric vehicles — motorcycles and buses in particular — are trending across Africa right now, and this is the latest proof point.) • Nigerian agrifintech Tingo finally published its quarterly report as well as a formal response to allegations from short seller Hindenburg Research. Hindenburg, in return, pointed out a number of inconsistencies and deficiencies. 𝗢𝗧𝗛𝗘𝗥 𝗧𝗢𝗣𝗜𝗖𝗦 • 600 or so companies across Africa generate annual revenues of over $500 million. Do you know which sectors lead the continent? • It's said that fortune favors the bold. But being too bold can backfire. This newsletter highlights an example. This week's edition also features Tosin Eniolorunda, Ikpeme Neto, Jason Njoku, Eghosa Omoigui, and others. __________________ 🚨 Afridigest is your intelligent guide to Africa's tech ecosystem. Subscribe to the newsletter today as a free reader or paying subscriber to get each edition in your inbox: afridigest.com/subscribe _________________ #africatech #africa #africanstartups #techinafrica #tech #vc #startups #fundraising #venturecapital #deals #weekinreview #emergingmarkets

As an established business, we don't always track what happens in the business startup space. It was with the pride of an African-domiciled business that I recently saw some statistics about the African business startup ecosystem and how it is experiencing a definite uptick in digital investment opportunities. In the third quarter of 2023 alone, African tech startups secured $1.4 billion in funding — that is quite a number! There is quite a bit of investor interest in digital startups in Africa. This influx of funds presents a significant strategic opportunity for both early-stage and more mature startups to secure the capital they need to expand and realise their potential. The sector isn't just growing; it's thriving with resilience, showcasing a robust 28% uptick in capital raised by these ambitious entrepreneurs. Digital investment "hotspots" are emerging across the continent, with Morocco, the Democratic Republic of Congo, Rwanda, Tunisia, Senegal, Ghana, Benin, and Tanzania leading the way in attracting the lion's share of these investments. With our rapidly growing footprint in the Business Process Outsourcing space, it is clear where our investment focus will be for the next few years. We will also track the activity of the regional accelerators and incubators and their investment focus. Africa has a vibrant investment climate, and we salute those early-stage ventures, innovative startups, and digital solutions that are leading the way in unlocking the continent's growth potential. Are you as excited as I am about Africa's emerging tech boom? I've left a link in the comments; have a look! #VintonGroup #AfricaTech #AfricanStartUps

It is great to see the movement heading to West Africa in 2024! Well done McKevin Ayaba and your team. Looking forward to interacting with more ecosystem builders this year. The 2023 summit and awards brought even more ecosystem builders together in Nairobi. Thanks for Africa Startup Ecosystem Builders Summit & Awards(ASEB) for recognising ecosystem builders in the continent! These are exciting times to be involved in entrepreneurial ecosystem building in Africa. I see endless opportunities for all if ecosystem actors pooled data and resources to collaboratively support entrepreneurs. Having focused conversations around what we already have can help entrepreneurs access information and resources within and between different ecosystem actors - locally and across the continent. Where can entrepreneurs go for resources, information, and support within and between entrepreneurial ecosystems?