State of Tech in Africa 2024 report 

The recently released AfricArena State of Tech in Africa 2024 report tells the stories of founders, investors and ecosystem builders - it also includes, as in the previous 4 years, a section providing a forecast of the investment (equity & venture debt) in #african #tech #startups

In our inaugural late 2019 report we had predicted that by 2022 investment in african tech startups would more than double and hit $4.5b - the actual was even better at $5b.

This year we foresee that, in spite of fairly depressed global VC markets, investments in African tech startups will start a rebound by mid 2024 and foresee a moderate growth in investments for the year, returning to above $4b. The driver for this are multiple from the amount of deployable capital in recently raised new funds (e.g. second funds for Partech, Novastar Ventures or TLcom Capital LLP Capital and new entrants such as Norrsken22), the fundraising cycle of startups needing to raise capital in 2024 (we expect the demand for capital to well exceed $5 billion), the continuous growth of capital intensive climate tech and energy startups and a strong grant cycle driven bv USAID to execute on the Prosper program by November.

We further believe that we will see increased activity on the M&A side, in particular an increased number of acquisitions of startups by corporations as part of their innovation plan or other startups as part of their scale-up strategies around the continent, particularly in fintech. Our model for subsequent years, indicates an upper range of $7.5 billion in 2025 with an accelerated rebound of the market and an expected 40% - 50% growth, driven in part by return of North American investors post US elections. but will soften in 2026 with another slower cycle from mid 2026. Total investment may exceed for the first time $10 billion by 2027. While the growth in these numbers may appear significant, it should be noted that this remains a very small fraction of the overall VC activity in tech globally and as of 2023, less than 1% of the global VC market and $3 per capita.

Discover more insights reading our State of Tech in Africa report, a free ecosystem research resource downloaded over 1,000 times and available on www.africarena.com

The article by Christophe Viarnaud, CEO at Methys