Investors in the Funding Winter age 🧤

A look at Africa's most active investors in the context of the funding slowdown of the past 12 months

A few weeks ago, Maxime mentioned to me he’d noticed that the most active investors in Africa weren’t being quite as active as they used to. So we agreed I’d dig into our database and check whether we could back his intuition with data. And as is often the case, Maxime was right.

If we compare H1 2023 to H1 2022, the number of investors who participated in at least one equity deal fell from ~650 to ~350 (-46% YoY). This drop is all the more so acute as we look at investors who participated in more deals: the number of those involved in at least two deals went down -60% YoY (from 200 to 80); -80% YoY for those active in at least 5 deals (from 46 down to 9). In H1 2022, 15 investors had been involved in 10 or more $100k+ equity deals; in H1 2023, there were only 4.

Who are these four resolute investors? Techstars is in the lead for the second half-year in a row with 26 deals (equity, $100k+) in H1 2023, and 90+ in total since 2021. They are followed by Launch Africa who is the only investor to have been involved in more than 10 deals (often a lot more!) every half-year since 2021. For more on them, check out our recent profile:

💡Spotlight on Africa's most prolific investor

The two investors who complete this group are Sweden-based Norrsken (40+ deals since 2021) and Catalyst Fund, which after 7 years of running their accelerator programme also recently started making equity investments in climate-related pre-seed startups (Full disclosure: Maxime works there).

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Why such a drop overall though? Well, there is no denying that the tougher context currently makes signing large amounts of deals trickier. But we wouldn’t want you to conclude from these numbers that Africa’s most active investors have somewhat become disinterested in the continent, or cold-feet. Context is key. The reality is, quite a few of them are simply having to stop and refuel. And by refuel I mean: raise their next fund. It was the case for Kepple Africa in the past, who dropped off the list in 2022, but is now back as Verod-Kepple Africa Ventures with a $43m fund. Launch Africa has now fully allocated their Fund I and is actively raising Fund II. LoftyInc and Flat6Labs - also in the top 5 most active investors on the continent in the past 2.5 years - are currently fundraising as well…

💸 The most active investors in Africa

Finally, a special mention goes to Google for Startups' Black Founders Fund who despite not making equity investments per se (they’re deploying ‘non-dilutive cash awards’ (read: grants)) is still playing an active role in supporting ventures on the continent with $11m deployed to 130+ organisations since 2021.

As always, our database is available to you readers at a discount if you use this link. For instance, with the dataset you could pull out for each of the investors listed above (and 1,800+ more…) a full list of the deals they have participated in. And if you think a deal might have flown under our radar, never hesitate to get in touch and let us know about it as we strive to build the most comprehensive dataset for the region… and continue to maintain our 4.9/5 star rating 💫 Ciao a tutti! Max