Africa secured $3.6bn in venture capital funding in 2024, including $1bn from venture debt, with African investors forming the single largest group of active VC participants in the region for the first time, according to a data from the AVCA – the African Private Capital Association.
The sixth edition of AVCA’s annual report reveals that Africa experienced a market correction a year after global markets, with the continent reaching its funding low in H1 2024 – highlighting the delayed but pronounced impact on dealmaking during a period of inflation, supply chain disruptions and geopolitical shocks.
The report finds that 2024 was a challenging year for African startups, noting a 22% year-over-year (YoY) decline in deal value and 28% drop in deal volume. While global venture capital value rose 6% and volume fell 24%, Africa’s sharper contractions reflect the continent’s delayed downturn cycle. Venture debt lenders comprised only 12% of deal volume yet generated 37% of VC deal value in 2024. The 3% YoY increase in deal value and volume signals continued investor appetite for the asset class.
The geographic distribution reveals that West Africa maintained its lead as the most active region for the fourth consecutive year, accounting for 23% of total deal volume, with Nigeria leading at 16%. The ‘Big 4’ markets (Nigeria, Egypt, Kenya, South Africa) represented 55% of volume and 64% of value.
FinTech remained dominant with 116 deals raising $1.4bn (34% of all tech-enabled rounds). Clean & ClimateТech meanwhile, rose to 13% of tech-enabled deal volume, up from a 7% five-year average, while AI made its first appearance among the top four most funded verticals with 42 deals raising $108m.
The fundraising environment showed remarkable resilience, with eight funds closing at $736m in 2024 alone, a 41% YoY increase that underscores the positive, long-term growth of Africa’s VC ecosystem despite global headwinds. Since 2015, 35 fund managers across 41 funds have raised $2.7bn in final closes, reflecting a 25% CAGR.
The exit landscape is also gaining momentum, with 138 exits recorded between 2019 and 2024 – reflecting a clear upward trend over time, despite remaining flat in 2024 with 26 exits recorded. Trade sales continued to dominate that year, accounting for 84% of all exits with an average holding period of 3.8 years.
