VC funding of African tech startups dips by 54% in H1 2023 as funding crunch continues.
According to knowledge from analysis agency MAGNiTT, VC corporations invested $951 million in the African tech ecosystem in H1 2023. It’s a 54% drop in comparison with H1 2022. VC corporations additionally accomplished 214 offers, a 50% decline from the 2022 numbers. Exits proceed to be few and much between in 2023 with solely 15 exits thus far.
Fintech continues to be the VC darling even in a downturn, with fintech startups clocking 29% of the whole funding. Ecommerce and transport and logistics startups full the high three receiving 12% and 11% of the whole funding respectively.
By nation, Nigeria lead the pack in phrases of deal quantity, adopted by Kenya and South Africa. In phrases of deal worth, Egypt leads the continent, primarily pushed by the $260 million MNT Halan deal in February, adopted by South Africa which noticed a 3% discount in deal worth and Nigeria.
Interestingly, accelerators, and never VCs, led most of the cheque-writing by quantity in this half of the yr, accounting for 5 of the high 10 investments in the time interval. Accelerators made up the high 4 of the most energetic buyers, with ARM Labs Lagos, Catalyst fund, The Baobab Network, and Norrsken Global main the way with 13, 19, 9, and eight offers respectively.
In phrases of worth, the whole high 10 comprise worldwide funding, with Chimera Capital, Tencent, Blue Earth Capital, Sumitomo Corporation, and Apis Partners main the way. Exits smart, 15 represents 25% of the whole 2022 whole of 60 exits on the continent , with Kenya main the way with 4 exits.
As the VC funding crunch continues, buyers appear to be focusing their consideration on making early-stage bets, with 57% of all funding into the continent going to early-stage startups, a 5% enhance in comparison with 2022 figures.
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