African tech startups raised $560 million in VC funding in 2017, a 53% YoY Growth as African entrepreneurs leverage tech and digital to tackle the continent’s fundamental challenges, said a new report from Partech Ventures.
The report, says 124 African tech start-ups raised a total of US$ 560 Million in equity through 128 rounds, compared to US$ 366.8 Million in 2016, a +53% growth YoY and 14 times growth multiple since 2012.
Investment in digital-only (minus off-grid) start-ups in Africa almost doubled $ 440 Million in 2017 from $ 231 Million in 2016.
According to Cyril Collon, General Partner at Partech Ventures, “The ongoing transformation of the VC tech space translates in the number of start-ups that were funded. In 2017, it has jumped to a total of 128 rounds (Seed+ to Growth stages) from 124 African tech start-ups, compared to 77 rounds last year from 74 start-ups; a +61% growth YoY in the number of VC-backed tech start-ups.”
The report adds that South Africa, Kenya and Nigeria were the top three investment destinations with 76% of the total funding, down from 81% in 2016. Off-Grid Tech, Fintech & E/M/S-Commerce led the pack with 61% of the total funding, down from 72% in 2016.
Off-Grid Tech raised $120M in 13 deals and 21% of total funding in 2017 from $134 Million in 2016. Debt financing for growth capital added $117 Million to the sector. Fintech stood at $119M in 29 deals and a 21% of total funding while InsurTech raised $14M in 4 deals and a 2.5% of total funding.
The report shows that Online & Mobile Consumer Services raised $236 Million, accounting for 42% of the total raised. The 4 main sub-verticals included E/M/S-Commerce at $105M with 19 deals at 19% of funding, EdTech at $65M with 5 deals at a 12% of total funding while Personal Services raised $41M in 16 deals amounting for 7% of total funding and HealthTech raised $21M in 7 deals at 4% of total funding.
Related posts
B2B & Tech Adoption accounted for 13% at US$ 71 Million, compared to 3,3% last year, across 20 transactions. Enterprise startups raised $60M in 3 deals amounting for 11% of total funding, 23 deals while connectivity startups raised US$10M in 3 funding deals amounting to 2% of total funding.
The total funding going to Seed+ and Early Stage (Series A & Series B) grew by 86% YoY to reach US$ 371 Million in 2017. In 73 transactions, the Seed+ round size is US$0.91M in 2017 compared to US$ 0.83m in 2016. Series A round is $4.5M in 2017 while Series B is US$10.5M
