Africa’s start-up ecosystem raised $2.2 billion through equity, debt, and grants in 2024 despite a 25% decline from the $2.9 billion raised in 2023, Africa’s start-up showed resilience.
While the total funding figure reflects a contraction, the stabilisation of equity funding and a strong rebound in the second half of the year have provided a cautious sense of optimism.
According to data from Africa: The Big Deal, the decline in funding was primarily attributed to a slow start in the first half of 2024, which saw just under $800 million raised, the lowest semester since 2020.
However, the second half witnessed a sharp recovery with $1.4 billion raised, a 25% year-on-year increase and an 80% improvement compared to the first half.
This late-year resurgence was buoyed by two landmark deals in Q4, where Moniepoint and Tyme Group emerged as Africa’s newest unicorns.
Moniepoint secured a $110 million investment led by Development Partners International’s ADP III fund to achieve a $1 billion valuation.
Meanwhile, Tyme Group, backed by Patrice Motsepe, raised $250 million in a Series D round led by Nubank to put its valuation at $1.5 billion.
Commenting on the trends, Africa: The Big Deal said “the relative counter-performance of 2024 is mostly to be blamed on a slow start of the year,” but the rebound in the latter half signals growing investor confidence and a potential shift in the funding landscape.
Debt funding, which had played a significant role in 2023—accounting for 38% of total funding—declined to 30% in 2024, reflecting a 40% year-on-year drop.
The contraction in debt funding contributed significantly to the overall decline, while equity funding showed signs of stabilisation.
Total equity raised reached $1.5 billion, an 11% dip from 2023’s $1.7 billion but a marked improvement from the 57% decline observed in 2023.
“This stabilisation of equity funding levels is a welcome development, particularly given the challenges faced in 2023,” the report noted. “It highlights growing investor confidence and a potential shift toward a more balanced funding landscape.”
A total of 188 ventures raised $1 million or more in 2024, just 10% fewer than the previous year.
Also, the exit market showed positive momentum with 22 exits made public in 2024 compared to 20 in 2023.
While 2024 did not match the highs of earlier years, including the record-breaking $4.6 billion raised in 2022, the late-year rally and stabilisation of equity funding offer hope for continued growth and recovery.
With the successes of Moniepoint and Tyme Group and a shift in funding dynamics, analysts remain optimistic about the region’s potential.
