Here’s how Q2 2023 started across Africa’s tech ecosystem.
Roughly 20 equity fundraises were announced in April, totaling ~$86M in disclosed funding, according to Afridigest’s weekly tracking. (This excludes mega-rounds from now-global companies Zipline and TerraPay, despite their origins in Africa.)
- Fintech remained the dominant sector, accounting for 40% of deals and just under 50% of funding raised in the month.
- In terms of region, Nigeria led the way in terms of deal count, accounting for six of the twenty deals announced in the month (30%), but South Africa’s four deals accounted for 50% of the funding figure. Notably, however, no equity deals were announced in Egypt in April.
- With Egypt missing, one might expect the historical dominance of NEKS (Nigeria, Egypt, Kenya, and South Africa) countries to have been tested in April, but three countries — South Africa, Kenya, and Nigeria — accounted for 96% of the disclosed equity funding and 13 out of the 20 deals (65%).
Here’s a look at the deals announced in April across Africa’s tech ecosystem.
In addition to the equity funding rounds above, there are three trends worth watching: an uptick in M&A, the continued impact of the market downturn on African startups, and the rise in dry powder across the ecosystem.
Relative to M&A, there were a number of interesting acquisitions in April:
- Nigerian automotive solutions provider & marketplace Autochek continued its acquisition spree as it purchased a majority stake in Egyptian used car marketplace AutoTager.
- Identity verification & digital KYC platform Smile Identity acquired its Ghanaian counterpart Appruve.
- Sun King, an American/pan-African provider of off-grid solar energy products, acquired pay-as-you-go smart meter provider PayGo Energy.
- And Ghanaian savings-focused digital bank BezoMoney acquired Ghanaian microfinance provider Tiger Force Micro Finance.
Aside from acquisitions, some startups faced challenges:
- Nigerian crypto payment gateway Lazerpay shut down, citing an inability to raise funding.
- Hover, the Kenyan/American parent company of USSD automation & offline payments platform Stax, transitioned to an open-source platform, also citing an inability to secure funding.
- E-commerce company Copia Global shut down its Ugandan operations and laid off 350 employees in order to focus on the “short-term profitability and long-term success” of its Kenyan business.
- And in a blow to the peer-to-peer crypto trading community across the continent, global Africa-focused P2P crypto exchange Paxful suspended operations indefinitely.
On the plus side, however, monied investors continued to bet on the ecosystem’s long-term potential:
- New sub-Saharan Africa-focused climate-tech VC firm Equator announced the first close of its first fund with $40M in commitments.
- Nairobi and Lagos-based VC firm Novastar Ventures secured a $25M investment into a new Africa People + Planet Fund that’s said to have a +$200M target.
- And Capria Ventures, an American firm whose portfolio includes Nigeria’s Max.ng and Egypt’s Paymob, announced the first close of a $100M fund focused on tech startups across Africa and other areas of the Global South.