Africa’s Unicorn Momentum: Why the Engine Stalled and How We Reignite It

In the last few years, Africa dazzled global capital with flashes of brilliance with young founders building billion-dollar companies (also called unicorns), cities buzzing with innovation, and the continent showing glimpses of its latent greatness. But in 2025, that momentum slowed. The unicorn engine, once roaring, began to sputter. And the message from the market was unmistakable: Africa is still struggling to consistently breed and scale unicorns into durable, global companies.

With two unicorns Moniepoint and Tyme minted in the final quarter, optimism surged with predictions that the continent had entered a new era of rapid scale and significant investors funding.

It was the first time since early 2023 that more than one unicorn had been minted in a single quarter, raising hopes that the momentum would continue into the new year. Analysts viewed them as symbols of resilience and renewed confidence in the African tech ecosystem, amid a challenging funding winter.

Across the continent, venture funding experienced what I call a bottom-heavy recovery. Investors kept writing seed cheques, but growth capital, the oxygen required for scale, evaporated. Late-stage funding plunged to its lowest point since 2020. Without scale capital, even the finest innovations struggle to break orbit. You cannot build dragons when the fuel tank is filled with droplets.

But there is a deeper matter here. Eight out of Africa’s nine unicorns sit in fintech, a brilliant sector, but also a reflection of structural confinement. Limited patient capital, fragmented regulations, small domestic markets, and weak exit corridors have kept our startups from expanding into the global theaters where valuation, defensibility, and IP-scale moats are forged.

Africa is blessed with innovators but constrained by the scaffolding required to turn innovation into enduring enterprises. We have entrepreneurs who can build amazing products, but the pathways to compound those products at scale are narrow. In Tekedia, we have noted repeatedly: a great idea without a scale pathway is like a seed trapped in a bottle, it cannot grow into a tree.

Some say, “We do not need unicorns.” I disagree. Not because a unicorn is a trophy, but because a unicorn is a marker of an ecosystem capable of supporting world-class enterprises. If Africa must rise, it must learn how to produce giants, not just mere startups.

The solution is not to shrink ambition; it is to fix the pipes of capital.

A major lever is our pension funds. If we reform the pension ordinances, responsibly, to allow a defined, prudent portion of pension assets to participate in private capital, we will unlock a catalytic force. No foreign investor can out-muscle Africa’s pension funds if those funds are allowed to dream beyond treasury bills. Israel did it; Singapore mastered it; America institutionalized it. Africa can do the same.

Good People, the capital is already here. In Nigeria alone, by November 2025, about N4.91 trillion, over 93% of all physical cash, sat outside the banking system. That is capital sleeping in lockers, bags, pockets, and homes. If anyone can organize that idle money into productive capital, Nigeria and indeed African SMEs and startups would soar, and the unicorn drought would end. Indeed, to breed unicorns, the challenge is not the absence of money but the translation of turning money into capital, to fuel ideas into industries, and startups into scale-ups.

Connect via my LinkedIn | Facebook | X | TikTok | Instagram | YouTube