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Africa’s startup ecosystem is roaring back, with January 2025 figures shattering past funding records, according to the latest analysis from Africa Big Deal, an African startup funding tracker.
According to market watchers, the surge marks a sharp pivot from cautious investing and is fueled by market maturity, investor confidence, and bold innovation.
“The four largest deals — alone representing nearly 60% of all the funding raised on the continent last month — were all originating in one of the Big Four, though three out of four have to do with extension to other geographies,” the tracker’s analysts explained in an update on February 10.
African startups kicked off 2025 with a funding surge, raising US$289 million in January which is 3.5x the US$85 million from the same time last year. It’s the second-strongest January since 2019, trailing only the 2022 funding boom.
Equity financing took center stage in January 2025, accounting for 90% (US$262 million) of total funding. Soaring 4.4x from 2024, this surge reflects rising investor confidence in Africa’s startup potential, shifting from short-term, risk-averse bets to sustainable, growth-driven investments.
January 2025 saw fewer deals (40), but bigger bets. 26 surpassed US$1 million, outpacing January 2024’s 21 deals. The trend signals rising investor confidence and Africa’s startup ecosystem scaling fast.
January 2025’s four biggest deals, making up nearly 60% of total funding, spotlight Africa’s hottest investment sectors—those primed for global expansion—energy, fintech, insuretech, and edtech.
Renewable energy leader PowerGen secured $US50 million to scale distributed energy solutions across Africa. This milestone advances sustainable power access for underserved regions, driving economic growth, education, and quality of life in off-grid communities.
LemFi, a Nigerian-born pan-African fintech, raised US$53 million to expand into Asia and Europe, highlighting surging global interest in African fintech. Its growth underscores Africa’s rising digital influence and the power of local startups to compete worldwide.
Last month, LemFi secured the Central Bank of Ireland’s approval to acquire Buttercrane, strengthening its global footprint. This follows its recent expansion into Brazil and Mexico, accelerating its international payment services.
Elsewhere, Naked, a South African insurtech, secured US$38M in Series B to scale its automated insurance solutions. Naked leverages AI and automation, allowing customers to get insurance quotes in less than 90 seconds, purchase policies online, file claims, and even pause accident coverage—all without requiring a phone call.
As African insurtechs continue to evolve in Africa, Naked is reshaping the market with affordable, accessible coverage for underserved populations—proof of growing investor confidence in tech-driven industry disruptors.
The last startup that secured funding last month is an edtech. Enko Education, an educational network with 16 international baccalaureate schools across 10 African countries, raised US$24 million in a funding round that will fuel its expansion across Africa.
The institution, which currently has schools in Cameroon, Zambia, South Africa, Togo, Cote d’Ivoire, Botswana, Mali, Mozambique, Burkina Faso, and Senegal, aims to grow its student body from 7,500 learners to 20,000 by 2029, according to its website.
According to Eric Pignot, co-founder and CEO of Enko Education, “The investment from ACW and Adiwale will focus our strategy on acquisitions to expand our family of schools.”
The significance of the January 2025 figures cannot be understated considering they mark a shift in the African startup funding landscape. After a 2023 dip, the market is not just recovering but thriving, with a surge in equity financing and larger deals. This marks a maturation of the market as investors increasingly back high-potential, scalable ventures.
The January funding figures are a continuation of a positive trend that started in the second half of 2024 when African startups raised US$1.4 billion—a 25% year-on-year jump. Notably, this was the second-best semester since the funding slump began in mid-2022, nearly doubling the US$800 million raised in the first half of the year.
