Africa’s venture capital ecosystem has been rapidly evolving in recent years, driven by a combination of factors, including increasing economic growth, a youthful population, a rising middle class, and a growing appetite for innovation and entrepreneurship.
This has led to a surge in Venture capital in Africa, Entrepreneurship in Africa, and Investment in Innovation in Africa, with startups across the continent receiving significant funding from both domestic and international investors. In this article, we will explore the growth of venture capital in Africa, highlight some notable startups that have attracted investment, and profile key venture capital firms and angel investors contributing to this ecosystem.
Africa’s venture capital ecosystem has made significant strides in recent years. Several factors have contributed to this growth:
Startups Receiving Funding
Several African startups have received substantial funding, reflecting the growing confidence of investors in the continent’s entrepreneurial potential. Some notable examples include:
This Nigerian fintech startup has revolutionized payment processing in Africa. It has secured investments from high-profile investors, including Tiger Global and Mastercard. Flutterwave provides a payment infrastructure for merchants and payment service providers. They offer an online marketplace for businesses to list their products and services for sale. They provide payment tools, including a smart payment ordering system for businesses to accept payments.
Focused on developing Africa’s tech talent, Andela has raised funding from investors like Mark Zuckerberg’s Chan Zuckerberg Initiative. Andela is a global job placement network for software developers. Andela focuses on sustainable careers, connecting technologists with long-term engagements, access to international roles, competitive compensation, and career coaching through the Andela Learning Community.
Andela was founded in 2014 by Jeremy Johnson, Iyinoluwa Aboyeji, Nadayar Enegesi, Brice Nkengsa, Ian Carnevale, and Christina Sass. In May 2014, Andela launched their first recruitment cycle in Lagos by putting their first call for applications on Twitter. The company hired its first cohort—four Nigerian software engineers—after receiving 700 applications for 4 spots:
Often referred to as the “Amazon of Africa,” Jumia has attracted investments from giants like MTN and Rocket Internet. Jumia Group connects consumers and businesses across Africa and beyond. Through their online platforms, consumers can access a wide range of products and services, from basic consumer goods to online travel. Jumia Group helps them save time and save money.
Businesses use Jumia in order to distribute their products and services in a more efficient and scalable way, and helps them grow their business and benefit from the massive shift of consumers online.
Jumia Group aims to transform people’s lives through technology. Jumia Group is embracing the digital shift of the entire African economy and supporting the growth of African companies while expanding their horizons. More than 50,000 local African companies and individuals have partnered with Jumia.
Jumia Group is opening new opportunities for talented people by creating jobs and developing new skills in the continent. Jumia Group directly provides 3,000 jobs and many more through sellers and logistics partners. Jumia Group is committed to creating a sustainable impact in Africa.
This Nigerian payments startup gained recognition after being acquired by Stripe, highlighting the growing interest in African fintech. Paystack lets businesses in Africa accept payments by anyone, anywhere in the world via credit card, debit card, money transfer, and mobile money on their websites or mobile apps. It specializes in the fields of financial services, the Internet, and payments. The company was founded in 2015 and is headquartered in Ikeja, Lagos.
Founded in 2013, Twiga is a Kenyan agri-tech company that has received backing from organizations like IFC, Goldman Sachs, and the Omidyar Network, based in Nairobi, Kenya. Twiga is a mobile-based supply platform for Africa’s retail outlets, kiosks, and market stalls. The company is using a mobile-based, cashless, business-to-business (B2B) supply platform to access distribution into the millions of small and medium-sized vendors in African urban markets.
A Nigerian logistics platform that has secured investments from investors such as Goldman Sachs. Kobo360 is a tech-enabled digital logistics platform that aggregates end-to-end haulage operations to help cargo owners, truck owners, drivers, and cargo recipients achieve an efficient supply chain framework.
Through an all-in-one robust logistics ecosystem, Kobo uses big data and technology to reduce logistics frictions, empowering rural farmers to earn more by reducing farm wastage and helping manufacturers of all sizes to find new markets. Kobo enables unprecedented efficiency and cost reduction in the supply chain, providing 360-visibility while delivering products of all sizes safely, on time, and in full.
The Kobo mission is to build a Global Logistics Operating System that will power trade and commerce across Africa and Emerging Markets. The company is also preparing to enter the agro-trading space by creating a marketplace that links farmers with buyers all over the world. The marketplace will effectively eliminate the high cost of middlemen for smallholder farmers and significantly improve profits.
Ife Oyedele ll and Obi Ozor founded it in 2017 and is headquartered in Lagos, Nigeria. These startups represent a diverse range of industries, from fintech and e-commerce to agri-tech and logistics, demonstrating the breadth of innovation across the continent.
Numerous venture capital firms and angel investors are actively driving innovation and entrepreneurship in Africa.
Here are some of the prominent ones:
African Firms
This Venture capital in Africa, entrepreneurship in Africa, and Investment in Innovation in Africa firm focuses on tech startups in Africa. It has invested in companies like TradeDepot, Andela, and Flutterwave. Partech, the global VC firm with several funds, has reached the first close of Partech Africa II at €245 million (~$263 million), making it the largest Africa-focused fund yet.
The firm, which focuses on early- and growth-stage startups across the continent, intended to raise about €230 million (~$250 million) for its second African fund and reach a first close at €150 million, according to general partners Tidjane Deme and Cyril Collon. However, overwhelming interest from LPs meant Partech Africa II surpassed what was initially set for the entire fund at first close. To add, the African fund will now seek to reach a final close of not more than €280 million (~$300 million),
With a pan-African presence, AfricInvest invests in a variety of sectors. They have backed companies such as Sokowatch and Zola Electric. AfricInvest was founded in 1994 and is part of Integra Group, an investment and financial services company based in Tunisia.
Uniquely positioned as one of the most experienced private equity investors on the continent, AfricInvest has dedicated investment teams focused on North Africa and Sub-Saharan Africa and employs 66 professionals based in seven offices.
AfricInvest manages USD1 billion across 16 funds and benefits from strong, long-term support from both local and international investors, including leading development finance institutions in the United States and Europe.
Having co-founded the African Venture Capital Association (AVCA) as well as the Middle East North Africa Private Equity Association (MENAPEA) and the Euromed Capital Forum, the firm is an active promoter of the private equity industry in the region.
Since 1994, AfricInvest has invested in 135 companies across 25 African countries in a variety of high-growth sectors and maintains a broad network of high-quality executives across Africa, offering extensive expertise in key growth industries, including financial services, agribusiness, consumer/retail, education, and healthcare.
Focusing on financial inclusion, Accion Venture Lab has supported startups like Lidya and Pula. Accion Venture Lab, part of global nonprofit Accion, is a leading early-stage investor in inclusive fintech startups. They provide access to well-designed, affordable financial services that allow low-income individuals and small businesses around the world to grow and prosper.
Since 2012 they have invested in 60 innovative, early-stage companies operating in over 35 countries. They provide inclusive fintech startups with smart capital, taking a hands-on approach through active governance and their unique Portfolio Engagement function, which provides targeted strategic and operational support to portfolio companies.
International Firms
A UK-based venture capital firm that actively invests in African startups, TLcom has backed Andela and Terragon Group. TLcom helps finance most of the startups and companies mentioned here.
This global venture capital firm has a dedicated Africa fund and has invested in several African startups, including Paystack and Flutterwave. 500 Global and Make-IT in Africa present a 1-year program specially tailored for African tech hubs.
This is a unique and comprehensive program that includes a 1 week intensive Bootcamp for Accelerator Managers (BAM), and a 12-month “Empowering African Accelerators” Sustainability Track.
In emerging startup ecosystems, accelerators and tech hubs face the challenge of supporting startups while being ´startups´ themselves, often struggling to find their own sustainable business models. BAM: EMPOWERING AFRICAN ACCELERATORS has been specially designed to empower accelerators to amplify their impact and support the region’s future entrepreneurs.
This impact investor has supported ventures like Paga and Nomanini, with a focus on inclusive fintech. Goodwell Investments is a pioneering investment firm focused on financial inclusion, fintech, and inclusive growth in sectors providing basic goods and services and income generation opportunities to the underserved.
Since 2006 Goodwell has raised 5 funds with over $ 100 mln in capital. Goodwell has invested equity in early-stage businesses in financial services and technology companies in India and Africa, ranging from classical microfinance to mobile payments, rural banking, affordable housing finance to merchant payment networks, and public transport technology.
Goodwell’s 25 portfolio companies have reached over 12 million households with more than USD 1.7 billion in financial products and services, and employ more than 30,000 employees. African portfolio companies in the fintech field include Paga (Nigeria), Nomanini (South Africa) Musoni Systems (pan-African), and in mobility tech WhereIsMyTransport (pan-African).
Angel investors are individuals or high-net-worth individuals who provide capital to startup businesses in exchange for ownership equity or convertible debt. These investors typically have a personal interest in supporting and nurturing early-stage companies and often bring more than just financial backing.
They often have experience or expertise in the industry in which they are investing and can provide valuable advice, mentorship, and networking opportunities to the entrepreneurs they back. Angel investors play a crucial role in the early stages of a startup’s growth, helping to bridge the gap between initial seed funding and larger-scale investments from venture capital firms or other institutional investors.
They are often involved in the early decision-making process and can provide the necessary resources for a startup to develop its product, enter the market, and achieve milestones that make it more attractive to larger investors.
Co-founder of Andela and Flutterwave, Aboyeji has become a prominent angel investor in Africa’s tech scene. Iyinoluwa Samuel Aboyeji (born March 28, 1991) is a Nigerian entrepreneur. He is the co-founder of Andela and the former managing director of Flutterwave. Aboyeji was cited as one of the Top 100 most influential Africans by New African magazine in 2019
An experienced angel investor and founder of the Lagos Angel Network, Davies has been instrumental in supporting Nigerian startups. Tomi Davies (born June 9, 1955) is a Nigerian-British investor, speaker, author, entrepreneur, philanthropist and advisor to technology companies.
He is the chief executive officer of TVCLabs, a technology business accelerator based in Lagos, and also sits on the boards of Sproxil, Strika Entertainment, TechnoVision Communications, PeoplePrime, and MBO Capital. Davies is co-founder of the Lagos Angel Network and founding president of the African Business Angel Network.
Founder of CRE Venture Capital, Taukobong invests in early-stage tech startups across the continent. Founding Partner at CRE Venture Capital. Previously founded Africa Angels Network, the first angel investment group to focus on Sub-Saharan Africa. Kauffman Fellow.
What challenges do you think startups face in African Countries?
While Africa’s venture capital ecosystem is on a positive trajectory, it still faces some challenges. These include:
Despite these challenges, the opportunities in Africa are vast. The continent’s rapidly expanding consumer base, untapped markets, and increasing demand for tech-driven solutions present significant potential for investors.
By fostering an environment of collaboration, governments, investors, and entrepreneurs can work together to overcome the challenges and unlock the full potential of Africa’s venture capital ecosystem.
Conclusion
Africa’s venture capital ecosystem is experiencing remarkable growth, with Venture capital in Africa, Entrepreneurship in Africa, and Investment in Innovation in Africa attracting investments from a diverse range of local and international investors.
The examples of successful startups, along with the active involvement of venture capital firms and angel investors, demonstrate the continent’s potential for innovation and entrepreneurship.
As Africa continues to position itself as a hub for tech and innovation, it is crucial for investors and entrepreneurs to navigate the unique challenges and opportunities presented by the region. The ongoing support from governments, the investment community, and the startup ecosystem is likely to drive further growth and success in the years to come. Africa’s rise as a global entrepreneurial hub is a testament to the continent’s resilience and its potential to shape the future of innovation.
Have you considered the potential of Africa’s entrepreneurial ecosystem? What opportunities do you see for innovation and investment on the continent? At the Center for Africa’s Development and Investment (CADI), we stand as a steadfast partner in this journey of economic transformation.
With a deep commitment to inclusive policies and sustainable growth, CADI empowers governments and the private sector to drive economic development. We facilitate strategic partnerships and mobilize development finance to promote impactful investments in African industries. Reach out to us and learn more about how you can be a part of something great!
Let’s be honest—when you think of Africa’s natural resources, you probably imagine oil rigs, mineral mines, and vast potential just waiting to be tapped. And you’d be right. But a lot of African countries, despite sitting on some serious natural gas reserves, are barely scratching the surface when it comes to actually using the stuff. […]
2025 is shaping up to be a defining year for Africa—not just as a player reacting to global shifts, but as a real force helping shape them. Let’s face it, Africa’s been on the edge of a major breakthrough for a while. With its young and ambitious population, a treasure trove of natural resources, and […]
Let us discuss a place packed with possibilities in 2025—and no, it is not another overhyped market or tech bubble. It’s about Africa. Indeed, the region that had been silently on the investment sidelines is now drawing full attention from investors worldwide. And not without good reason. There’s something electric happening across Africa—driven by its […]