April 2024 ...🐌

With only $75m raised through 25 $100k+ deals, April was a pretty slow month

You know what, let me jump straight to some of the ‘silver lining’ data points for once. To begin with, two new exits happened in April 2024: Ghanaian health tech Rivia acquired SaaS provider Waffle, and Kenyan transport tech BuuPass* acquired QuickBus to accelerate their expansion to Nigeria and South Africa. And there were also two Series B in Africa last month, while there had only been one in Q1 altogether: Kenya-based SunCulture - which markets solar irrigation systems - disclosed its $27.5m round on April 12. Three days later, it was Pula‘s turn - an insurtech also based in Kenya - to announce their $20m round. Combined, these two deals represented 63% of all the funding raised on the continent last month…

Indeed, start-ups in Africa only raised $75m in April 2024 (exc. through exits), a -47% drop YoY. It is the second-lowest amount raised in a month since 2021 (after March 2023, $69m). In stark contrast with previous periods, almost no debt funding was disclosed last month ($1m, vs. $74m in equity). There were only 25 deals $100k+ and over publicised last month, the slowest monthly activity in terms of deal numbers since we started to track $100k+ deals in 2021.

Given that numbers can fluctuate quite a bit on a monthly basis, it is more relevant to compare ‘year to date’ (YTD, i.e. Jan-April) data. In 2024YTD, start-ups in Africa have raised $542m through 153 deals $100k+. This is considerably less than in the past three years. YoY, it represents a -22% decrease in deal number and -47% drop in deal value. Of the funding raised in 2024YTD, 85% have gone to start-ups headquartered in one of the Big Four (30% Nigeria, 29% Kenya); 28% went to Logistics & Transport ventures, 25% to fintech and 14% to energy. In number of deals though, fintech continues to be in the lead.

To end on a more positive note (three, actually): First, climate tech-tagged investments represented a third of both the number of deals and the amount raised in 2024YTD, an all-time high for comparable periods. Second, while the number of $100k+ deals has fallen -22% YoY, the number of $1m+ deals has gone up (+9%, from 69 in Jan-April 2023 to 75 in 2024YTD). Third, 10% of the funding in 2024 so far has gone to start-ups with a female CEO (vs. 6% and 3% during the same period in 2023 and 2022 respectively).

OK, the overall numbers aren’t very encouraging, but as you can see, if you scratch the surface, you can always find some silver lining…Defiant optimism is a common trait of many entrepreneurs and investors on the continent, so it doesn’t hurt to look on the bright side of data sometimes. While we hope for better numbers in the coming months of course. Au revoir, Max

* Full disclosure: Maxime and I are both early-stage minority investors in BuuPass