Seth Onyango, bird story agency….
Kenya continued its impressive investment run for the third consecutive semester, hauling in US$244 million in startup funding in the first half of 2024.
In the review period, the East African nation captured almost a third (32%) of all funds raised by startups in Africa, according to the startup tracker, Africa: The Big Deal.
Kenya’s share of total funding grew by 5 percentage points compared to 2023 as other ‘Big Four’ markets, Nigeria, South Africa and Egypt struggled.
In East Africa, Kenya accounted for 86% of the region’s total funding, down slightly from 89% in 2023 while overall, the region led the continent by attracting 37.5% ($285 million) of total venture capital.
Uganda was the only other East African nation to surpass US$10 million, raising US$19 million, while Tanzania narrowly missed this threshold with US$9 million. The remaining countries, including Sudan, Ethiopia, and Rwanda, each garnered less than US$5 million.
Nigeria emerged as the second most attractive market for VC funding, securing US$172 million, which equates to 23% of Africa’s total.
This marks a significant rebound from its 14% share in 2023, propelling the continents most populous nation from fourth to second place.
Despite the recovery, Nigeria has not reclaimed the top spot it held in 2021 and 2022. S a region, West Africa closely followed East Africa with $270 million in funding, representing 35.5% of the continent’s total.
However, Nigeria’s share of regional funding was lower at 64%, down from 68% in 2023. Benin attracted US$50 million through a single deal (spiro), while Ghana and Senegal raised $29 million and $11 million, respectively.
Historically, Nigeria has raked in the lion’s share of Africa’s startup funding, a testament to its large population, entrepreneurial spirit, and significant market potential. South Africa, Kenya and Egypt make up the rest of the “big four” investment destinations on the continent.
Kenya’s and East Africa’s successful fundraising trend could be signalling a shift in investor interest outside the traditional market leader.
Investors might be recognizing the burgeoning opportunities in East Africa, driven by robust economic policies, growing tech ecosystems, and increasing digital adoption across the region.
Egypt ranked third in the survey, with US$101 million in funding, though its share of the continent’s total dropped significantly to 13% in H1 2024 from 22% in 2023.
Nonetheless, Egypt still attracted 87% of Northern Africa’s total funding, similar to the previous year.
Morocco was the only other Northern African country to exceed $10 million in startup investments, raising $14 million. Tunisia and Algeria saw limited startup activity since 2023, a stark contrast to their stronger performances in 2021 and 2022, driven largely by Algeria’s Yassir.
South Africa fell to fourth spot, raising US$85 million, which accounted for 11% of Africa’s total startup funding in H1 2024, down from 21% in 2023.
Despite this decline, South Africa continued to dominate its region, accounting for 98% of funding, up from 96% in the previous year. This regional total represented 11.5% of all the funding on the continent.
Meanwhile, the report highlights that 22 African countries recorded at least one deal exceeding US$100,000 in H1 2024.
