African startup investment picks up pace in July

July 2024 was a good month for startup fundraising in Africa with US$420 million raised (excluding exits), the highest monthly performance for the ecosystem in 14 months.

That is according to new data from Africa: The Big Deal, which showed that more was raised in July 2024 than the whole of the second quarter of the year and 2.5 times the average monthly amount raised over the past 12 months.

(Source: Africa: The Big Deal)

Africa: The Big Deal's "Startup Deals Database" tracks all investment deals secured by startups in Africa.

Earlier this year it reported that African startup funding dropped 39% in 2023 as the global "funding winter" impacted investment into the continent.

The funding decline continued, and in the first six months of 2024, startups in Africa raised $780 million (excluding exits), a 31% drop compared to the second half of 2023, and a 57% decline compared to the first half of 2023.

Four out of five dollars invested in startups in Africa in H1 went to ventures based in the "big four" countries of Kenya, Nigeria, Egypt and South Africa – with Kenya getting the biggest portion of the pie at $244 million.

This has long been a trend and between 2019 and mid-2024, 83% of funding raised went to these four countries, with only 17% aimed at the "rest of Africa."

(Source: Africa: The Big Deal)

July investment jump

The July 2024 data shows that 47 ventures raised at least $100,000 during the month, the second-best month this year after May, and 16 startups raised at least $1 million, on a par with the monthly average in the first half of the year.

Max Cuvellier Giacomelli, co-founder of Africa: The Big Deal, said that the July numbers were heavily skewed by the two mega deals that were announced during the month: sustainability startup d.light's $176 million securitization facility and Egyptian fintech platform MNT-Halan's $157.5 million raise.

Remittance startup Nala also raised $40 million in a Series A round. Combined, these three deals represent 90% of the funding raised in the month.

Cuvellier Giacomelli said there were also four exits (not included in the numbers above), the most notable of which was ticketing company Quicket's acquisition by Ticketmaster.

July 2024 was the best month of July on record, since Africa: The Big Deal started tracking in 2019, and by quite a margin.

"This great monthly performance means that the ecosystem was able not only to comfortably cross the $1 billion mark in terms of funding raised in 2024 so far ($1.2 billion), but also to top the amount raised in 2020. The next milestone – the $1.4 billion raised in 2019 – is now within reach," Cuvellier Giacomelli explained.

These figures are, however, far below the $4 billion that African startups raised in 2021 and 2022, according to the database.

(Source: Africa: The Big Deal)

Last week, a report from Disrupt Africa and Madica highlighted a lack of gender diversity when it comes to African startup funding.

The report showed that of the $6.2 billion raised by African tech startups between January 2022 and the beginning of June 2024, only 11.9% went to startups with a female co-founder and just 4.6% to startups with a female CEO.

Last month, research from the Southern African Venture Capital and Private Equity Association (SAVCA) and VS Nova showed that venture capital investment into South Africa grew in 2023, with investments into ICT companies almost doubling compared to 2022.

— Paula Gilbert, Editor, Connecting Africa