African startups raised a total of $2.2 billion in 2024, a 25% decrease from the $2.9 billion secured in 2023. The funding included equity, debt, and grants, but excluded exits. Despite the overall decline, 188 startups managed to raise $1 million or more, just a 10% drop from the previous year.
The first half of 2024 was particularly slow, with African ventures raising less than $800 million, the lowest amount since late 2020. However, the second half of the year saw a significant rebound, with startups raising $1.4 billion, an 80% increase from the first half and a 25% year-over-year rise. This made the second half of 2024 the second-strongest semester since the beginning of the funding slowdown.
Two major deals in the fourth quarter, involving Moniepoint and Tyme Group, contributed to the uptick in funding and created two new unicorns. These were the first back-to-back unicorns since early 2023. Africa’s tech ecosystem has become a center of innovation, attracting global attention for its rapid growth and ability to address pressing issues through technology.
African startups funding trends
However, the sector faces challenges, particularly due to global economic conditions that have affected funding progress. Despite these obstacles, the ecosystem’s resilience is evident in its continued ability to attract significant investment, highlighting the potential and dynamism of African startups.
Debt funding saw a decline in 2024 compared to the previous year. In 2023, debt funding made up 38% of total funding, but this share dropped to 30% in 2024, with a 40% year-over-year contraction. Total equity raised in 2024 reached $1.5 billion, an 11% decrease from 2023’s $1.7 billion.
However, this stabilization in equity funding levels is seen as a positive development, especially considering the 57% year-over-year decline in equity funding experienced in 2023. This suggests growing investor confidence and a potential shift towards a more balanced funding landscape. Moniepoint and Tyme became the newest African unicorns in 2024, raising $110 million and $250 million, respectively.
Moniepoint’s Series C investment was led by Development Partners International’s African Development Partners (ADP) III fund, while Tyme Group’s Series D round was led by Brazil’s Nubank, which contributed $150 million.
