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Startup investments vary widely across Africa, VC4Africa shows

Research by startup funding platform VC4Africa indicates African countries have very different startup scenes, with investments varying widely across the continent. The research shows South Africa has the largest startup investments, Nigeria has most startup investments, and Kenya the largest total startup investments. On Wednesday, March 18, VC4Africa co-founder Ben White will share these and other insights at the 2015 Global Entrepreneurship Congress in Milan, the world’s premier annual gathering of startup champions, with attendees from over 150 countries.

VC4Africa (Venture Capital for Africa) aims to be the world’s leading online platform for entrepreneurs and investors in Africa. The VC4Africa community has over 20,000 members in 159 countries, including 600 investors. Two thousand entrepreneurs in Africa present their companies on the platform: early stage ventures that require investments less than USD 1 million.

Because there is little information available on this emerging segment, VC4Africa has recently for the second time taken the initiative to survey its community of entrepreneurs and investors. This led to VC4Africa’s 2015 Venture Finance in Africa report, tracking progress across Africa’s startup funding scenes. The community’s data sets do not represent the total African investment space, but the research certainly indicates key trends.

VC4Africa Co-Founder Ben White explains: “The research shows there are a growing number of businesses that are successfully growing their operations over time and adding much needed jobs to the African marketplace. This is a key message to investors. Now is the time to get involved in this space.”

Variety in startup investment scenes across Africa

When looking at investments in African startups, VC4Africa’s research shows a big variety in startup investments across Africa. For example, the research indicates South Africa has the largest startup investments, Nigeria has most startup investments, and Kenya the largest total startup investments. At the Global Entrepreneurship Congress in Milan, where startup ecosystems from across the world come together, VC4Africa wants to show the diversity of African startup scenes.


Number, average and total of startup investment in selected African countries
Country Investments tracked Average investment (USD) Sum of all investments (USD)
Nigeria 24 57K 1.4M
Kenya 19 250K 4.7M
Tanzania 12 66K 788K
South Africa 11 250K 2.8M
Ghana 10 65K 648K
Uganda 10 152K 1.5M
Cameroon 9 28K 251K
Egypt 9 42K 381K

The highest instance is indicated (underlined) for each column.


End of 2014, VC4Africa was able to track 104 investments in startups across Africa listed on its platform, with a total amount of USD 27 million. Out of the 104 tracked investments, most were in Nigeria (24), followed by Kenya (19), Tanzania (12), South Africa (11), Ghana (10), Uganda (10), Cameroon (9) and Egypt (9). Countries like Nigeria, Kenya, South Africa and Ghana are often named as examples of startup hotspots in Africa. Nigeria, coming out as the continent’s top startup investment destination, recently got more and more attention, for example with new incubators opening and the two most recent DEMO Africa events.

When looking at the averages of tracked startup investments in the 8 mentioned countries, we see the largest average investment in South Africa (250K), directly followed by Kenya (slightly lower, rounded off 250K as well). Behind this are Uganda (152K), and – at a distance – Tanzania (66K), Ghana (65K), Nigeria (57K), Egypt (42K), and Cameroon (28K). It is known that South Africa’s startup scene includes more mature ventures and explains the bigger ticket sizes. The research indicates this is also the case in Kenya, and that startup investments in other ‘startup hotspots’ Nigeria and Egypt are much smaller on average. Certainly the volume of deals in Nigeria points to the quick rise of the startup scene there, and the promise for much bigger deals expected to happen in this market the coming period.

The sum of all tracked startup investments is highest in Kenya (4.7M). After this South Africa (2.8M) is followed by Uganda (1.5M) and Nigeria (1.4M) at some distance, followed by Tanzania (788K), Ghana (648K), Egypt (381K) and Cameroon (251K). The high sum of investments in Kenya corresponds with this country being considered one of Africa’s ‘startup hotspots’.

What kind of startups are this?

Some African startups that have raised funding include TopCheck, Tugende, IroFit, Ubongo, Soko, Karibu Solar, Njorku, Kiro’o Games and many others. They are early stage ventures that require investments less than USD 1 million. Each venture is scalable, makes smart use of technology, or is disruptive in their application of a business model. Think innovations such as a touch sticker, a platform for social gaming, mobile payment startups, recycling waste for street lamps, edu tech ventures, messaging and other apps, and more. See 20 of Africa’s startup investment success stories from 2014 listed on VC4Africa, as inspiration for 2015.

Global Entrepreneurship Congress

At the 2015 Global Entrepreneurship Congress – held in Milan from Monday, March 16th to Thursday, March 19th – VC4Africa co-founder Ben White will share insights on progress in Africa’s startup spaces. This event is the world’s premier annual gathering of startup champions, with attendees from over 150 countries. VC4Africa is one of the main partners in the LIONS@FRICA Partnership. Wednesday, March 18th, 4:00pm to 6:00pm CET/CAT, the Global Entrepreneurship Network and the LIONS@FRICA Partnership will present the session ‘Building Cohesive Entrepreneurial Ecosystems for Africa’.

Speakers at this session include Matt Pelton (African Leadership Network), Harry Hare (DEMO Africa), Ben White (VC4Africa), Thomas Debass (US Department of State), Parminder Vir (The Tony Elumelu Foundation), Michele Rivard (U.S. African Development Foundation), Kizito Okechukwu (SEA Africa), Alicia Robb (Kauffman Foundation), Nicholas Vilelle (Global Entrepreneurship Week).

Find out more about Africa’s startup ecosystems

For those who want to read more, VC4Africa released a summary version of the Venture Finance in Africa report freely accessible from the VC4Africa website. The full report is made available exclusively to surveyed entrepreneurs and the VC4Africa Investor Network (VC4Africa Pro Account holders and partners).

The summary report gives an overview of the research results on 5 parameters (jobs created, revenue performance, investment, investors, ecosystem) and more. The full report contains more specific insights on the 5 studied parameters, includes more case studies and a comparison with last year’s results. People interested to receive the full report should register as a VC4Africa Pro Account user on the VC4Africa website or contact the team at VC4Africa.

Download a free summary of the VC4Africa 2015 Report: Venture Finance in Africa and see for yourself.

VC4Africa is the continent’s leading startup funding platform. Join as an investor to get priority access to Africa’s leading SME entrepreneurs and future research. Join as an entrepreneur to register your venture, follow 5 steps to fundraising and more.

Africa investments map - Source = VC4Africa 2015 Venture Finance in Africa Report


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