Funding for startups in Nigeria, S’Africa, Egypt drops by 25 per cent

• Moniepoint, Tyme Group mega deals push regional funding to $2.2b

Start-ups in Africa raised $2.2 billion in 2024 through equity, debt and grants. While the amount looks good in absolute terms, it represented a 25 per cent drop compared to the $2.9 billion raised in 2023. The region raised $1.4 billion in 2019; in 2020, $1.1 billion; in 2021, $4.3 billion and 2022, $4.6 billion.

A total of 188 ventures raised $1 million or more in 2024, which is just 10 per cent less than in 2023 though. On the exit front, there were 22 exits made public last year, versus 20 in 2023.

According to Africa: The Big Deal, the relative counter-performance of 2024 is mostly to be blamed on a slow start of the year: just under $800 million raised in H1, the slowest semester since 2020. However, there was a serious rebound in the later part of the year as $1.4 billion was raised in H2 alone (+25 per cent YoY and +80 per cent compared to H1), which made it the second-best semester since the beginning of the ‘funding winter’ in mid-2022.

The numbers were driven in part – but not in full – by the two mega deals of Moniepoint and Tyme Group in Q4, minting two new unicorns back-to-back, the first such events since early 2023.

Africa: The Big Deal said another reason to remain positive is that the YoY decline in funding is mostly attributable to a decline in debt funding.
According to the report, one positive takeaway from the 2024 funding was the decline in debt compared with the previous year.

In 2023, dubbed “The Year of the Debt,” debt funding constituted a substantial 38 per cent of total funding. However, this share declined to 30 per cent in 2024, with debt funding contracting by 40 per cent YoY. Total equity raised in 2024 reached $1.5 billion, reflecting an 11 per cent drop from 2023’s $1.7 billion but signalling a recovery after the steep 57 per cent YoY decline in equity funding seen in 2023.

The research firm noted that this stabilisation of equity funding levels is a welcome development, particularly given the challenges faced in 2023, adding that this highlighted growing investor confidence and a potential shift toward a more balanced funding landscape.

Both Moniepoint and Tyme became the newest African unicorns in 2024 after raising $110 million and $250 million respectively.
Moniepoint in October 2024, secured a $110 million investment from multiple investors including Google, bringing its valuation to $1 billion. The firm was founded in 2015 by Tosin Eniolorunda and Felix Ike.

The Series C investment was led by Development Partners International’s African Development Partners (ADP) III fund – a premier fund focused on Africa.

In December, Patrice Motsepe-backed Tyme Group also raised $250 million in a Series D funding round, which brought the fintech’s valuation to $1.5 billion.

The Series D round was led by Brazil’s Nubank, Latin America’s most valuable financial services company, which contributed $150 million.