The first half of 2024 has brought significant changes to Africa's startup landscape, marked by shifts in funding and investment. Both global economic challenges and regional political factors have influenced these changes.

Significant Drop in Startup Investments

In the first six months of 2024, the African startup ecosystem recorded 256 deals, a 24% decrease compared to the same period in 2023. Funding also saw a significant drop, with startups raising $1.06 billion, down 55% year-over-year. The first quarter was the most prosperous, attracting $661 million, while the second quarter saw a decline to approximately $400 million. This downturn is largely due to ongoing global macroeconomic challenges and regional political instability.

Kenya and Nigeria Lead in Startup Activity

Kenya and Nigeria have emerged as leaders in the African startup scene during the first half of 2024, securing the highest number of deals with 62 and 54, respectively. In terms of funding, the "big four" countries—South Africa, Kenya, Nigeria, and Egypt—dominated the landscape. South African startups led with $345 million, followed by Kenya with $245 million, Nigeria with $192 million, and Egypt with $100 million.

Fintech Dominates, Energy and Logistics Follow

Fintech continues to be the top sector for funding in Africa, maintaining its leading position from previous years. In the first half of 2024, the Energy and Water sector ranked second, followed by Logistics and Transport. These sectors have attracted significant investor interest, reflecting their critical roles in the continent's development.

DEG Tops List of Active Investors

The German Investment and Development Company (DEG) was the most active investor in Africa during the first half of 2024, participating in 18 deals. Other notable investors included Launch Africa, Mastercard, Co-Creation Hub, and iHub, each recording 12 deals during this period.

Top Funding Round and Notable Exits

The largest funding round in the first half of 2024 was a Series B round for Moove, a Nigerian-founded mobility fintech company, which raised an impressive $100 million. On the exit front, the most notable transaction was the acquisition of Payspace by Deel for $100 million. Another significant exit was Adumo’s acquisition by Lesaka for $85.9 million.

In summary, the first half of 2024 has been a mixed period for African startups, characterized by decreased funding and investment activity, yet notable achievements in specific sectors and countries. Despite the challenges, the resilience and dynamism of the African startup ecosystem continue to drive innovation and attract investment.