Investment into the African tech startup ecosystem passed the US$3 billion mark for the first time in 2022, with the space withstanding global economic headwinds to post a record year.
This is according to the eighth edition of the annual African Tech Startups Funding Report released by startup news and research portal Disrupt Africa, which is available free to all as part of an open-sourcing initiative in partnership with Flat6Labs, MarketForce, 4Di Capital, Mercy Corps Ventures, Newtown Partners, and InsiderPR.
The report tells the story of an impressive 2022 in which more startups raised more funding than ever before, in spite of a global downturn in investments, especially in riskier asset classes such as venture capital. In all, 633 startups raised a combined US$3,333,071,000 in 2022. This represented incredible growth. The number of funded startups increased by 12.2 per cent on 564 in 2021, while the total secured funding jumped 55.1 per cent on US$2,148,517,500 in 2021.
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Nigeria, Egypt, South Africa and Kenya remain Africa’s “big four” from a funding perspective, yet they secured a smaller share of total funding between them than in 2021, with startups from more African countries than ever before securing investment. Nigeria remained the undisputed leader, however, with 180 startups raising a combined US$976,146,000.
Though Nigeria and the rest of the “big four” remain clear leaders, there is still plenty of activity elsewhere on the continent, with startups backed in 27 African countries.
The fintech sector was, yet again, the most attractive to investors in 2022, with more startups securing funding than any other sector and a combined total that dwarfed all others. The sector raised almost US$1.5 million in funding.
Other sectors also had impressive years, however, with the likes of e-commerce and retail-tech, e-health, logistics, energy, agri-tech and transport.
The report is available for free download here. Aside from providing a full list of the funded startups, who invested in them, and, where possible, the amount raised, from the previous year, the annual reports also provide deep-dives into investment trends within key startup geographies and verticals, as well as data on African startup acquisitions.
“In spite of global pressures, 2022 was another outstanding year for the African tech space. Who knows what the future holds, and whether the sector will now enter a more fallow period, but for now the space can reflect on a very good 12 months work,” said Disrupt Africa co-founder Gabriella Mulligan.
Previously available for sale, the African Tech Startups Funding Report was previously purchased each year by leading tech companies from Africa and the rest of the world, Big Four consulting firms, banking and fintech leaders, venture capital firms, supranational investors and international trade bodies. Now, however, Disrupt Africa releases the publication for free, making it accessible to those for whom the information is most valuable – African entrepreneurs.
This year it is doing this with the help of partners Flat6Labs, MarketForce, 4Di Capital, Mercy Corps Ventures, Newtown Partners, and InsiderPR, with whose support Disrupt Africa will be distributing the African Tech Startups Funding Report 2022 to as many ecosystem stakeholders as possible.
“For too long access to crucial industry data such as this has been out of reach for active or aspiring entrepreneurs, as they are usually priced out of access,” said Disrupt Africa co-founder Tom Jackson. “It is the Disrupt Africa ethos to make as much information freely accessible as possible, and we can’t thank our partners enough for helping us with the open-sourcing of this publication.”
“In 2022, MarketForce raised a US$40 million Series A round – a significant milestone in its own right, but even more so for a startup founded by two young black men. On a continent where capital continues to pour in, it also matters where it is going. As an operator and investor myself, seeing the continued disparity in investment opportunities for growth-stage startups and underrepresented founders, including black and female founders, is disheartening. Yet, we must succeed – the impact of what we stand for and who we serve is too important not to. Let’s make this journey count,” said Muthoni Wachira, chief of staff at MarketForce.
“Well done and thank you to Tom, Gabriella and the Disrupt team for once again producing a top quality report. This information is crucial and very valuable for all players in the ecosystem,” said Anton van Vlaanderen, 4Di Capital partner.
“Africa remains one of the most exciting and diverse regions to invest in innovation globally. We see a huge impact potential with many of the continent’s startups and are pleased to partner with Disrupt Africa on their sector-leading insights report,” said Scott Onder, managing director of Mercy Corps Ventures and chief investment officer at Mercy Corps.
“As an active investor in Africa, we are eager to see the advancement of the ecosystem through knowledge-sharing and collaboration between local and international players. We are therefore delighted to support this initiative by Disrupt Africa to make this report freely available to all stakeholders,” said Newtown Partners managing partner Llew Claasen.
“InsiderPR was founded on the idea that visibility is the missing link for the entrepreneurs and investors driving innovation in African economies. We are proud to partner with Disrupt Africa to spotlight the African startup ecosystem’s successes in a year full of strong headwinds,” said Aubrey Hruby, co-founder of InsiderPR.