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Home Startups African tech startup funding passes $700m in 2020 despite COVID-19

African tech startup funding passes $700m in 2020 despite COVID-19

by Sam Wakoba
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The sixth edition of the annual African Tech Startups Funding Report 2020 by our friends from Disrupt Africa shows that 397 startups raised an impressive US$701.5 million in total, 27.7 percent more than 2019.

According to this year’s report, at least 370 active investors, participated in the funding, marking 42.8 per cent growth compared to the previous year and a 68.4 percent rise compared to 2018.

Kenya, Nigeria, South Africa and Egypt remain emphatically Africa’s “big four” from a funding perspective, accounting for 77 per cent of funded startups and 89.2 per cent of total investment. Nigeria (85), Egypt (82) and South Africa (81) lead the way from a ventures perspective, but when it comes to total combined raised capital it is Kenya that is Africa’s leader, with startups from the East African country raising over US$190 million in funding in 2020.

Though these markets remain clear leaders, there are signs of growing activity elsewhere on the continent, with startups backed in 24 African countries, up from 19 in 2019, 20 in 2018, and 18 in 2017.

The financial technology sector was, yet again, the most attractive to investors in 2020, with more startups securing funding than any other sector and a combined total that dwarfed all others.

In all, 99 fintech startups raised investment over the course of the year, representing 24.9 per cent of the overall total, while the combined amount raised by fintech companies over the course of the year jumped 49.3 per cent to US$160,319,065.

However, growth in fintech investment is slowing to some extent, and other sectors also had impressive years – notably e-commerce and retail-tech, e-health, logistics, energy, recruitment and HR, transport, and agri-tech.

The report is available for free download here.

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