Africa : Fundraising carried out by African start-ups recorded a drop of 36% in 2023 to stand at $3.2 billion

Fundraising carried out by start-ups operating in Africa recorded a drop of 36% in 2023 to stand at 3.2 billion dollars compared to 2022 (5 billion dollars), according to data published on Wednesday 3 January 2024 by the digital economy consulting firm TechCabal Insights.

This amount is the lowest since 2020 ($2.1 billion), the same source said.

Over the past year, fundraising overall saw a quarter-over-quarter decline, from $1.2 billion in the first quarter to $877.8 million the following quarter, then to $492. 7 in the third trimester. However, a slight increase was recorded in the fourth quarter ($551.2 million) compared to the previous quarter.

The distribution of fundraising carried out by African start-ups in 2023 by sub-region shows that North Africa holds the upper hand with 33.67% of the total financing mobilized ahead of East Africa (26 .22%), Southern Africa (19.94%), West Africa (17.89%) and Central Africa (1.92%).

As in previous years, four countries (Kenya, South Africa, Egypt and Nigeria) captured the majority of fundraising. Nicknamed the “Big Four”, they monopolized 74.9% of the total amount mobilized by all the countries on the continent.

The sectoral breakdown of fundraising also reveals that start-ups operating in the field of financial technology (fintech) remain the best financed nuggets in Africa, with 45% of the total financing raised last year.