A new report has revealed interesting trends in African startup funding, with Kenya and Egypt leading the pack in 2024 so far. However, the data also highlights a persistent gender gap in investment.
According to reports by The Big Deal Africa report dubbed Wrapping up the Q3 Round, Egypt and Kenya emerged as the top destinations for funding in the third quarter of 2024, collectively accounting for 75% of all investments made on the continent during this period.
The large deals secured by d.light and MNT-Halan significantly skewed the numbers, with Egypt attracting $272 million (43%) and Kenya receiving $201 million (32%).
While these two countries dominated the funding landscape, four other markets also managed to secure substantial investments: Tanzania ($43 million), South Africa ($40 million), Ghana ($35 million), and Nigeria ($26 million).
However, the report suggests that a significant number of markets, totaling 38, did not attract any significant startup funding activity during the quarter.
Continuing the trend observed in Q3, Kenya and Egypt maintained their top positions in the overall funding landscape for 2024. Together, these two countries accounted for a remarkable 58% of all funding raised on the continent year-to-date.
This represents their highest share on record since 2019, surpassing even their previous full-year and Q1-Q3 performance.
“The dominance of Kenya and Egypt has led to a relative underperformance by their “Big Four” peers. Nigeria, despite securing $218 million (15%) of the funding raised in 2024, has seen a decline compared to its previous year’s share of 14%. South Africa, with only 9% ($125 million) of the funding raised, is currently experiencing its worst performance since 2019 in terms of its share of continental funding,” the report highlighted.
While the Big Four countries have captured a significant portion of the funding, the remaining 18% has been distributed across the rest of Africa.
A total of 23 markets have recorded at least one deal exceeding $100,000 since the beginning of the year. Among these, Tanzania, Ghana, Morocco, Uganda, and Rwanda have demonstrated particular growth, securing at least ten such deals each.
Furthermore, three markets – Benin, Tanzania, and Ghana – have witnessed significant funding inflows from single deals.
“Benin’s Spiro received $50 million out of its total funding, while Tanzania’s Nala secured $40 million out of $53 million. Ghana’s Fido, although receiving $30 million out of $64 million, is also showing promising signs of growth and maturity.”
Gender Gap Remains a Challenge
Despite the positive developments in the African startup funding landscape, the gender gap in investment continues to be a pressing issue, the report stated.
“In 2024, less than 5% of the funding has gone to startups led by female CEOs, marking a decline from the 5.6% average observed between 2019 and 2023.”
Moreover, funding for all-female founding teams has also decreased, falling to less than 1% compared to 2.1% in previous years. Teams with at least one woman founder have experienced a similar decline, receiving 9% of the funding in 2024 compared to 17% in the 2019-2023 period.
“While the data paints a concerning picture, it is important to acknowledge the achievements of the few women who have managed to secure funding despite the headwinds.”
