We knew African startups were raising a lot of money but in 2018, the collective pool of money raised was mind blowing. According to a new research conducted by Digest Africa, African startups raised a total of $1.19 billion last year.
Research from @digestafrica : Technology companies across Africa raised a total of $686.4 million in funding across 336 disclosed funding deals of the 415 recorded. For details https://t.co/shxBxLGJ97 pic.twitter.com/VuS0plhiIf— ABAN Angels (@ABANAngels) January 15, 2019
According to the report, around 415 funding rounds were recorded across the continent. And these funding options came by way of debt/loans, grants/awards/prizes/non-equity assistance, venture capital, angel investment, initial coin offerings, crowdfunding and corporate funding. Only funding rounds above $10,000 were considered.
However, the report predicts that startups across the continent may have actually raised much more than the $1.19bn sum. Evidently, about how much was raised wasn’t disclosed in 103 funding rounds. That’s a whopping 22% of the total number of deals. Nevertheless 336 disclosed deals raked in $686.4 million in 2018.
Furthermore the report shows rather surprisingly that the East African region recorded the largest funding amounts. Startups from this region raised about $303.9 million, which represents about 44.2% of total funding raised on the continent.
Last year, 30 different African startups raised individual rounds higher than $5 million in the clearest sign of how the sector is maturing quicklyhttps://t.co/TYKTKZ5mfd via @qzafrica pic.twitter.com/SVxg6fwA0Y— Quartz Africa (@qzafrica) January 15, 2019
Meanwhile, Kenyan startups beat other countries to raise the most money on the continent. Kenya raised a whopping $156.5 million, representing about 22.8% of the continent’s total funding.
And across sectors, startups providing financial services carted the most sum. These companies raised $276.7 million through 92 funding rounds.
The report also highlighted that the EU’s European Investment Bank was the most active investor in the continent’s ecosystem. The bank invested in five multimillion dollar venture funds.
To be fair, five funding rounds is quite small, as some VC firms invested in over five startups last year. However, the significance of the EIB’s investment is that it was large and transnational. None of its investments was targeted at only one country.
The latest report signals another huge win for the continent’s tech ecosystem. Over the last few years, records have shown that the continent’s funding rounds were rising quickly.
In 2017, Disrupt Africa estimated that startups raised around $195 million. However, Partech estimated a much larger funding of over $500 million. Either way, the $1.19 billion reportedly raised in 2018 is by far the largest sum ever recorded in the continent.
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