The Partech Africa annual report on the financing of African startups has revealed that tech startups raised over $1.16 billion in equity funding in 2018, with Nigeria, Kenya and South Africa leading with the largest chunk of the fund. The report discloses that equity deals in tech and digital spaces, and funding rounds were higher than $200,000 and lower than $10 million. Deals covered are both disclosed and undisclosed. The report only includes African start-ups with their primary market in Africa itself, in terms of operations and revenues.
In 2018, the report notes that 146 African startups raised a total of $1.163 billion in equity through 164 rounds, this is a +108 per cent growth YoY, compared to +33 per cent in 2016 and +53 per cent in 2017. This also represents x4.2 growth multiple over the last 36 months. It is quite simply astonishing. When we started our journey to create the Partech Africa Fund in 2015, we had anticipated the $1 billion mark to be broken by 2020. We are now already two years ahead of our projection. “The Partech Africa report tracks a total of 164 rounds raised by 146 start-ups compared to 128 rounds from 124 start-ups last year, a +28 per cent growth YoY. What is interesting is that the number of Series A & B stage start-ups attracting funding are massively accelerating with 70 rounds (+46 per cent YoY), and that the number of large venture growth deals have increased as well, with 14 rounds (+100 per cent YoY), totaling $ 602 million (+120% YoY). Regarding investors, PE investors and major corporate players are now joining the game earlier, investing early & growth stage tickets in African tech start-ups.
“Kenya, Nigeria and South Africa received 78 per cent of the total funding with Egypt close behind, an exact repeat of last year. Kenya took the lead attracting $ 348 million (+136 per cent YoY) in funding over 44 deals (+76 per cent YoY), Nigeria has attracted $ 306 million (+167 per cent YoY) in funding over 26 deals (+53 per cent YoY) and South Africa slowed down compared to Kenya and Nigeria, with US$ 250 million (+49% YoY) in funding over 37 deals (-12% YoY),” the report reads in part.