There is a clear sense of renewed optimism among venture investors in Africa. The strong start to 2025 – with African VC funding up ~240% year-on-year in January and continuing robustly in February – suggests that many investors who paused in 2023 are back in the market. Global venture trends also show signs of recovery, and Africa, with its growth story, is benefitting. Fintech remains a magnet, but investors are increasingly looking for differentiation; sectors addressing Africa’s fundamental needs (finance, energy, agriculture, healthcare) with tech-enabled models are in favour.
Furthermore, large global investors (like QED, found in the Raenest deal, or Standard Chartered’s venture arm in some deals) are actively participating, bringing not just capital but also validation to the ecosystem.
Heading into March and Q2 2025, we expect the African investment momentum to continue. Key things to watch include: the impact of any interest rate changes (a Nigerian rate cut could spur even more funding by improving liquidity), the performance of mega-deals (e.g. will Gozem’s success spark more big rounds in Francophone Africa?), and the pace of exits (as some investors will be looking for IPO or acquisition opportunities for mature startups, potentially influencing late-stage funding). Additionally, any major geopolitical events or global market swings could alter risk appetite.
For now, however, the trajectory is positive – Africa’s venture ecosystem in 2025 is on track for a strong rebound, with diversification in deal geography and sectors that bodes well for the continent’s innovation-driven growth.
Funding in February was again concentrated in a few key markets – notably Nigeria, Egypt, and South Africa – but we also saw increased activity in Francophone West Africa (thanks to the Gozem deal) and the continued emergence of others like Ghana and Morocco.
Nigeria retained the top spot by total amount (boosted by large fintech rounds), while Egypt led in number of deals (multiple mid-sized rounds).
South Africa’s ecosystem showed resilience with a mix of deals in tech and venture capital (including a $15.8M pan-African fund launch).
Kenya’s lull this month appears temporary, as its fundamentals (strong tech talent and innovation hubs) remain intact.
We expect a more even distribution of deals in upcoming months as investors scout opportunities across under-tapped markets (e.g. Francophone Africa, North Africa).
