African Startups Raised $4 billion in 2021 in spite of COVID Restrictions

Based on the most recent data from Africa: The Big Deal, Nigeria, South Africa, Egypt, and Kenya represented 80% of all cash raised on the continent by the end of November, with Nigeria alone accounting for 35% of the inflow.

In 2021, Africa’s startup bolstered, bringing in a record $4 billion before the year’s close, showing a rise in investor interest in the continent’s rapidly-growing tech industry. They garnered more than 2.5 times the amount they had raised in 2020.

Africa currently has seven startup giants, according to Wee Tracker: Jumia, Interswitch, Flutterwave, Andela, Wave, OPay, and Chipper Cash.

This year, five of them became outstanding, including two in September alone, suggesting unprecedented interest in Africa’s startup industry.

The continent’s main four – Nigeria, South Africa, Egypt, and Kenya – ate up the lion’s share of the over $4 billion raised until 2021.

According to data-driven research firm Briter Bridges, African businesses raised $605 million in November 2021 alone, which is roughly half of the total amount of funding raised by African startups in all of 2020 – around $1.3 billion.

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While financial technology companies continue to receive the lion’s share of total funding, cleantech is increasingly attracting capital from local and international investors, including a growing number of corporations looking to accelerate their transition to renewable energy, according to Briter Bridges.

The firm said, “healthcare, data and IT infrastructure, and agriculture follow as more private companies reach maturity, but ticket sizes remain contained compared to those across fintech and cleantech.”

Chipper Cash, which raised a total of $250 million this year, was one of the finest success stories.

According to the Connecting Africa research, the startup’s Ghanaian and Ugandan co-founders, as well as its African HQs split between Ghana and Kenya, “make it quite pan-African,” according to the authors, Max Cuvellier and Maxime Bayen.

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“Without Chipper Cash, Ghana raised $48m in 2021; Algeria – $30m; Morocco – $29m; Tunisia – $23m; Uganda – $18m; Rwanda – $16m; the DRC – $12m and Cameroon – $11m.” they wrote.

Nigerian startups raised $1.37 billion in 2021, followed by $838 million in South Africa, $588 million in Egypt, and $375 million in Kenya. For the year, startups in Africa’s most populated country landed over 200 deals, while the remaining three countries each had over 100.

Senegal and Tanzania were two other proactive areas outside of the big four, with entrepreneurs raising $222 million and $96 million, respectively.

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