- Eastern Africa startups raised $1.2 billion in 2022 a 115 percent increase compared to 2021 where startups raised $600 million.
- Western Africa, despite a small decrease in funding in the period under review, remains firmly in the lead in the continent.
- The region’s startups received funding worth $1.8 billion in 2022 from $2 billion in 2021.
Eastern Africa startups raised $1.2 billion in 2022 a 115 percent increase compared to 2021 where startups raised $600 million.
Latest data from The Big Deal indicate that this is a huge milestone as the region reached the $1 billion mark for the first time resulting in its revenue share for continental funding more than doubling from 12 percent in 2021 to 26 percent in 2022.
According to the report, Western Africa, despite a small decrease in funding in the period under review, remains firmly in the lead in the continent. The region’s startups received funding worth $1.8 billion in 2022 from $2 billion in 2021.
Northern Africa had the highest increase in the period under review receiving $1.1 billion startup funding, crossing the $1bn mark for the first time. This represents a 62 percent increase from the previous year where startups got $700 million funding in 2021. Its share of funding raised on the continent grew, from 15 percent to 23 percent.
“Southern Africa however is the region suffering the biggest loss with a 44 percent decrease from $1.1bn in 2021 to just over $600m in 2022. As a result, its share of the total funding was also about halved: 12 percent, down from 23 percent,” the report states.
Central Africa remains miles behind its neighbors with ~$50m raised – more than double the 2021 number – and a total share of funding that surpassed 1 percent for the first time.
“A caveat of course is that in each of the regions – save for Central Africa -, a ‘Big Four’ dominates. Their weight ranges from Nigeria’s 68% of Western African funding to South Africa’s 92% in Southern Africa. The Nigerian giant itself ($1.2bn) weighs as much as a full region. Interestingly though, the relative weight of the Big Four in their respective regions has been decreasing between 2021 and 2022 in Western Africa (-17pp YoY), Northern Africa (-14pp YoY) and Southern Africa (-6pp YoY); Eastern Africa is the only exception with Kenya’s share of East Africa funding growing +14 percentage points, year on year,” the report explains.
Kenya occupied the second position in the continent as start-ups raised a record $1 billion (Sh135.8 billion) from international investors in 2022.
Nigeria retained position one with $1.1 billion (Sh148.1 billion) while Egypt came in third place with $818 million ($101.2 million) and South Africa $548 million (Sh62.9 billion).
“While it has been coasting in H2, Kenya has had such a strong start of the year that it had topped 2021 numbers by March, and already records 2.5x YoY growth between 2021 and 2022,” The Big Deal data shows.
Across the continent, startups raised $4.1billion + with 1000+ deals of over $100, 000.
“It is worth noting though that Kenya is really playing catch-up after a disappointing 2021: with -24 percent Year on Year, it was the only one of the Big Four to suffer a decrease in funding raised between 2020 and 2021, while its three peers were growing – exploding rather – by a factor of 4x to 5x,” the report added.
Kenyan Startups That Received Funding in 2022
Some of the biggest gainers in the Kenyan startup scene this year include retail and distribution firm MarketForce that raised $40 million from a Series A round to introduce credit services and expand across Africa, Apollo, Agri-tech startup which in March 2022 raised $40 million in equity funding from a Series B round.
In January 2022, Poa Internet secured $28 million to grow its reach across the country and the continent at large while Tech credit platform Lipa Later raked in $12 million from a pre-Series A funding.
In February 2022, Electric Vehicle (EV) startup BasiGo raised $4.3 million in seed capital, just three months after its launch to build electric buses assembly plant in Nairobi in addition to its current charging and servicing depot.
Moreover, iProcure, a Kenyan agritech startup, closed a $10.2 million Series B round in August.to develop its own distribution infrastructure which connects major agricultural input suppliers directly to local agro-dealers.
On the other hand Turaco, an insurtech startup, raised $10 million funding in a Series A round in September 2022 to grow its strategic partnerships towards mass market insurance adoption on the continent.
Others include Kapu, that raised $8 million, Amitruck $4 million in seed funding to enter the Tanzanian and Ugandan markets, and Lami Technologies, an insurtech firm which uses a B2B2C approach to facilitate the distribution of insurance, raised $4 million seed extension in August to expand across Africa among others.