African Businesses Secure 487 VC Deals in 2024—Report
Amidst rising needs for fundraising, Africa’s entrepreneurs’ ecosystem secured 487 deals from venture capitalists valued at $3.6 billion, the African Private Capital Association, AVCA, said in a report, saying the total deal closed accounted for less than 1% of global capital raised.
In its Venture Capital in Africa report, AVCA expressed that funding has slowed; venture capitalists (VC) have pumped about $50 billion into the African investment ecosystem over a decade.
Last year, Africa’s venture capital ecosystem registered double-digit declines that outstripped all other regions in scale amidst a mixed global recovery. The report highlighted that 2024 reveals a venture capital landscape that is slowly inching toward stability, although progress is neither uniform nor assured.
Still, VCs welcome new founders, as the report highlighted that 34% of capital recipients in 2024 were raising their first round, with venture capital rather than debt boasting a higher frequency of inaugural funding rounds.
It said deal size rose by 32% year on year to US$2.5 million in 2024, even as overall deal activity fell below the five-year average. In total, 427 deals were recorded across US$2.6 billion in disclosed value in African markets.
Startups were noted to navigate a quicker fundraising cycle in 2024. The time taken to secure follow-on funding accelerated across every stage—averaging 14 months from Seed to Series A, 19 months from Series A to B, and 25 months from Series B to C.
Meanwhile, nearly one in five deals went to climate-focused ventures, but their aggregate value in 2024 was less than half the year prior, the report said.
The Africa VC report revealed that supersized activity dropped last year. It noted that 8 super-sized deals with a combined value of US$1.3 billion took place in 2024, down 34% compared to 2023.
Most of these deals were closed by African VCs. The report said African investors became the single largest investor group on the continent for the first time, comprising 31% of the 614 active investors in 2024.
Last year, 8 venture capital funds reached final close, raising a combined US$736 million—a record high for final closes by value, according to the report. Africa’s entrepreneurial ecosystem secured a total of 487 deals in 2024—427 as venture capital and 60 as venture debt, according to Africa Venture Capital report.
“While overall activity continued its downward trajectory, the volume of venture capital deals concluded in 2024 is particularly striking because it dropped below the five-year average”, AVCA said.
The report stated that at best, this outcome may signal increased investor judiciousness, where those on the receiving end of the year’s deal activity represented the ‘best’ of Africa’s startups, having successfully navigated sub-optimal market conditions.
Alternatively, it may indicate a sustained and unpredictable decline in investor appetite for early-stage opportunities on the continent.
Venture debt, by contrast, exhibited modest resilience, achieving a 5% year on-year increase despite an otherwise subdued market environment.
Nevertheless, the broader picture underscores this cumulative slide. Venture deal activity across Africa fell by an average of 13% every half-year since 2022 and culminated in the 2024 tally representing only 81% of the deals struck in 2023 and 57% of those in 2022.
Much of this shortfall was traced to Nigeria, South Africa, and Kenya, three of Africa’s “Big Four” markets, which together accounted for two-thirds of the decline.
The first half of 2024 saw venture funding channeled to Africa plunge by 65% to $0.8 billion compared to $2.1 billion achieved during the same period in 2023.
However, this gap eased considerably by year-end, landing at a 28% year-on-year decrease by value – thanks in large part to a number of high-profile FinTech deals in Q4, the report said.
Even so, the US$2.6 billion raised by African startups brought the continent’s share of global venture funding to less than 1% for the first time since the funding low triggered by the Covid-19 pandemic in 2020.
Despite a thinner deal pipeline, African startups demonstrated strong global competitiveness at later funding stages. At the Series B and Series C stages, African startups posted median deal sizes of US$29 million and US$38 million, respectively—surpassing the global averages of US$21 million (Series B) and US$35 million (Series C).
On the one hand, this highlights that African startups securing growth capital can compete successfully on the global stage. On the other hand, it may signify that startups in Africa require larger funding rounds at later stages compared to their global counterparts, potentially reflecting unique market challenges or higher capital needs, AVCA said.
Over the past decade, venture capitalists have deployed nearly US$50 billion to Africa, the report said. While the funding channeled to the continent is far from comparable to that in other markets, it remains a testament to both the ecosystem’s promise and its growth story.
In 2024 specifically, African ventures collectively secured US$3.6 billion, split as US$2.6 billion via equity and US$1 billion through debt. While venture debt comprised only 12% of deal volume, it assumed a far more substantial 37% of deal value in 2024— indicating a strategic shift in the capital-raising strategies employed by African founders.
Median deal sizes in 2024 stood at US$2.5 million for venture capital and US$7.5 million for venture debt, reinforcing venture debt’s increasingly important role in the startup financing toolkit.
The report said despite the insulation of venture debt’s stable performance in 2024, the US$2.6 billion raised in 2024 is a pale shadow of totals recorded in previous years; comprising three quarters of aggregate funding in 2023 and a more diminutive half of funding amassed in 2021 and 2022.
Most striking is that the entirety of venture capital raised in 2024 is nearly equal to that raised in a single quarter at the height of Africa’s bull market, which saw Q3 2021 close out at an unprecedented US$2.2 billion. Despite challenging funding conditions, Africa’s startup ecosystem marked two significant milestones in 2024, AVCA highlighted in the report.
Nigeria’s Moniepoint secured unicorn status in October after closing a US$110 million Series C, while South Africa’s Tyme Bank raised a US$250 million Series D, joining this exclusive cohort shortly thereafter.
Other notable funding successes included Egypt’s MNT-Halan and Nigeria’s Moove, both of which raised rounds exceeding US$100 million.
These funding highs demonstrated continued capital accessibility for businesses with robust fundamentals, clear unit economics, and demonstrable scale potential—even amidst global macroeconomic headwinds. #African Businesses Secure 487 VC Deals in 2024—Report
