Investment into the African tech startup ecosystem passed the US$3 billion mark for the first time in 2022, with the space withstanding global economic headwinds to post a record year.
This is according to the eighth edition of the annual African Tech Startups Funding Report released by startup news and research portal Disrupt Africa, which is available free to all as part of an open-sourcing initiative in partnership with Flat6Labs, MarketForce, 4Di Capital, Mercy Corps Ventures, Newtown Partners, and InsiderPR.
The report tells the story of an impressive 2022 in which more startups raised more funding than ever before, in spite of a global downturn in investments, especially in riskier asset classes such as venture capital. In all, 633 startups raised a combined US$3,333,071,000 in 2022. This represented incredible growth. The number of funded startups increased by 12.2 per cent on 564 in 2021, while the total secured funding jumped 55.1 per cent on US$2,148,517,500 in 2021.
Nigeria, Egypt, South Africa and Kenya remain Africa’s “big four” from a funding perspective, yet they secured a smaller share of total funding between them than in 2021, with startups from more African countries than ever before securing investment. Nigeria remained the undisputed leader, however, with 180 startups raising a combined US$976,146,000.
Though Nigeria and the rest of the “big four” remain clear leaders, there is still plenty of activity elsewhere on the continent, with startups backed in 27 African countries.
The fintech sector was, yet again, the most attractive to investors in 2022, with more startups securing funding than any other sector and a combined total that dwarfed all others. The sector raised almost US$1.5 million in funding.
Other sectors also had impressive years, however, with the likes of e-commerce and retail-tech, e-health, logistics, energy, agri-tech and transport.
The report is available for free download here. Aside from providing a full list of the funded startups, who invested in them, and, where possible, the amount raised, from the previous year, the annual reports also provide deep-dives into investment trends within key startup geographies and verticals, as well as data on African startup acquisitions.
“In spite of global pressures, 2022 was another outstanding year for the African tech space. Who knows what the future holds, and whether the sector will now enter a more fallow period, but for now the space can reflect on a very good 12 months work,” said Disrupt Africa co-founder Gabriella Mulligan.
Previously available for sale, the African Tech Startups Funding Report was previously purchased each year by leading tech companies from Africa and the rest of the world, Big Four consulting firms, banking and fintech leaders, venture capital firms, supranational investors and international trade bodies. Now, however, Disrupt Africa releases the publication for free, making it accessible to those for whom the information is most valuable – African entrepreneurs.
This year it is doing this with the help of partners Flat6Labs, MarketForce, 4Di Capital, Mercy Corps Ventures, Newtown Partners, and InsiderPR, with whose support Disrupt Africa will be distributing the African Tech Startups Funding Report 2022 to as many ecosystem stakeholders as possible.
“For too long access to crucial industry data such as this has been out of reach for active or aspiring entrepreneurs, as they are usually priced out of access,” said Disrupt Africa co-founder Tom Jackson. “It is the Disrupt Africa ethos to make as much information freely accessible as possible, and we can’t thank our partners enough for helping us with the open-sourcing of this publication.”
“Supporting Disrupt Africa’s research efforts and further spotlighting the exceptional African entrepreneurship ecosystem is an honour,” said Ramez El-Serafy, CEO of Flat6Labs. “African countries harbor exceptional innovative and disruptive energy that can transform tech-enabled industries and boost economic development in the continent. We are excited to become a larger part of these pivotal moments in its growth story.”
“In 2022, MarketForce raised a US$40 million Series A round – a significant milestone in its own right, but even more so for a startup founded by two young black men. On a continent where capital continues to pour in, it also matters where it is going. As an operator and investor myself, seeing the continued disparity in investment opportunities for growth-stage startups and underrepresented founders, including black and female founders, is disheartening. Yet, we must succeed – the impact of what we stand for and who we serve is too important not to. Let’s make this journey count,” said Muthoni Wachira, chief of staff at MarketForce.
“Well done and thank you to Tom, Gabriella and the Disrupt team for once again producing a top quality report. This information is crucial and very valuable for all players in the ecosystem,” said Anton van Vlaanderen, 4Di Capital partner.
“Africa remains one of the most exciting and diverse regions to invest in innovation globally. We see a huge impact potential with many of the continent’s startups and are pleased to partner with Disrupt Africa on their sector-leading insights report,” said Scott Onder, managing director of Mercy Corps Ventures and chief investment officer at Mercy Corps.
“As an active investor in Africa, we are eager to see the advancement of the ecosystem through knowledge-sharing and collaboration between local and international players. We are therefore delighted to support this initiative by Disrupt Africa to make this report freely available to all stakeholders,” said Newtown Partners managing partner Llew Claasen.
“InsiderPR was founded on the idea that visibility is the missing link for the entrepreneurs and investors driving innovation in African economies. We are proud to partner with Disrupt Africa to spotlight the African startup ecosystem’s successes in a year full of strong headwinds,” said Aubrey Hruby, co-founder of InsiderPR.
For more information, or to download the report, please visit disrupt-africa.com/funding-report, or email Gabriella on gabriella@disrupt-africa.com, or Tom on tom@disrupt-africa.com.
About Disrupt Africa
Disrupt Africa is the one-stop-shop for all news, information and commentary pertaining to the continent’s tech startup – and investment – ecosystem. With journalists roaming the continent to find, meet, and interview the most innovative and disruptive tech startups, Disrupt Africa is a true showcase of Africa’s most promising businesses and business ideas. Its research arm releases in-depth reports on various aspects of the African tech startup ecosystem. Details here.
About Flat6Labs
Flat6Labs is the MENA region’s leading seed and early stage venture capital firm, currently running the most renowned startup programs in the region. Flat6Labs invests in innovative and technology-driven startups, enabling thousands of passionate entrepreneurs to achieve their daring ambitions and ultimately becoming their institutional co-founders. Launched and headquartered in Cairo since 2011, Flat6Labs has multiple offices across the region; with ongoing plans to expand into other emerging markets.
About MarketForce
MarketForce is a pan-African technology company that is building the super app for Africa’s 100 million merchants. Launched in 2019, MarketForce is a fast-growing YC-backed company running an asset-light business model. Having raised the largest Series A round in East and Central Africa in 2022, MarketForce is now operational in five markets in Sub-Saharan Africa (Kenya, Uganda, Tanzania, Rwanda, and Nigeria), and has over 200,000 merchants and nearly 200 consumer brands trading on its platform.
About 4Di Capital
4Di Capital is an independent venture capital fund manager based in South Africa’s “Silicon Cape”, specialising in high-growth technology venture opportunities, at the seed, early-and growth-funding stages.
About Mercy Corps Ventures
Mercy Corps Ventures invests in and catalyses venture-led solutions to increase the resilience of underserved individuals and communities. Founded in 2015 as the impact investing arm of global development agency, Mercy Corps, we’ve supported 41 early-stage ventures to scale and raise over US$333.9 million in follow-on capital. Our portfolio is 51 per cent female-founded and centres around resilience-building solutions in adaptive agriculture and food systems, frontier fintech, and climate smart systems, so that those living in frontier markets can withstand disruption and plan for the future. Through capital and support, piloting new approaches, action-oriented insights, and rigorously managing impact, we catalyse the ecosystem toward smarter, more impactful investments.
About Newtown Partners
Newtown Partners (newtownpartners.com) is the family office of successful startup entrepreneurs, Llew Claasen and Vinny Lingham. It invests across a range of alternative and traditional asset classes, especially early-stage venture capital to back startups utilising emerging technologies and disruptive business models. Since 2019, it has worked with pan-African and European logistics player, Imperial (a DP World company) to enable their corporate venture capital programme. Newtown Partners operates out of offices in San Diego, U.S. and Cape Town, South Africa.
About InsiderPR
InsiderPR is a leading emerging market public relations firm helping visionary founders and investors across Africa and the Middle East tell their stories to the world. Using our “no-fluff” Write-Speak-Meet model, Insider has helped shape the narrative and increase the public profile of over 125 of the world’s leading emerging market companies, including Flutterwave (YC ‘16) and Swvl (NASDAQ-listed), as well as venture capital firms, funds, and government agencies. Our US and Africa-based team provides strategic communications advisory around the clock focusing on thought leadership.
