Tuesday, 26 January 2021 06:03

Tech start-up funding surpasses $700m in Nigeria, others

The year 2020 was a record-breaking one for African tech start-ups, with 397 companies securing $701.5m worth of investments.

According to the sixth edition of the annual African Tech Start-ups Funding Report 2020 released by Disrupt Africa, 2020 was a record year for investment into the African tech start-up ecosystem, with more start-ups raising more money from more investors than ever before.

The report found that despite the COVID-19 pandemic, the number of startups and the total funding gathered were up substantially on the previous year, with the number of funded start-ups increasing 27.7 per cent as against 2019, and the funding total growing by 42.7 per cent.

This year’s edition of the report also counted at least 370 active investors, marking 42.8 per cent growth on the previous year, when the data tracked 261 investors.

The research indicated that the Nigerian tech space was on an upward trajectory, revealing that the country recorded significant growth in the number of start-ups securing funding in 2020.

According to the report, Nigeria, Kenya, South Africa and Egypt remained Africa’s ‘big four’ from a funding perspective, accounting for 77 per cent of funded start-ups and 89.2 per cent of total investment.

 “Nigeria (85), Egypt (82) and South Africa (81) lead the way from a ventures perspective, but when it comes to total combined raised capital, it is Kenya that is Africa’s leader, with start-ups from the East African country raising over $190m in funding in 2020,” the research stated.

It added that though these markets remained clear leaders, there were signs of growing activity elsewhere on the continent, with start-ups backed in 24 African countries, up from 19 in 2019 and 20 in 2018.

Co-founder of Disrupt Africa, Gabriella Mulligan, noted that the growth in funding seen across the continent’s tech ecosystems in 2020 was extremely strong, and all the more impressive given the circumstances of the year.

“As African start-up funding passes the $700m mark for the first time, and more investors pump more money into more markets than ever before, there are no signs of the sector slowing down,” she added.

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