The H1 numbers on African VC funding reveal that debt funding has shown an overall decline compared to H1 in 2023 of -56%, with equity funding still the dominant player, totaling 127 deals and a total funding value of US $489.76 million.
A significantly larger portion, almost 2.5 times more, went towards growth stage deals (38.04%) compared to early stage deals (16.95%).
The Mobility and Fintech sectors captured the most debt funding in H1-2024, at 79.90% of the total debt funding. Benin’s Spironet and Kenya’s M-Kopa raised USD 50 M & 51 M debt rounds respectively.
Non-equity rounds were the least popular funding round type, accounting for only 0.7% of the total funding raised in H1-2024, suggesting a preference among investors for funding structures that provide an ownership stake in the companies they support.
The ongoing 2-year downward trend of funding is of major concern with 2023 also having lost over 50% compared to 2022. Fin-Tech start-ups are still dominating this field with the Agri-Tech sector starting to show some growth
Block-Chain Provides VC Momentum
Although there may be a rather pessimistic outlook on VC funding overall, there are signs of growth in Block-Chain Tech developments. African block-chain funding is expanding in large parts due to regulatory advancements according to a new report released by the Swiss firm CV VC.
It found block-chain is having an impact on transparency, sustainability, data accountability, and is assisting in the development of new service and creator economies, and with the added benefit of broader financial inclusion across the region.
The report indicates that block-chain accounts for 6.4 per cent of Africa’s total venture funding value and 12,5% of all VC deals in volume in H1 2024, surpassing the global average of 3.5 per cent in venture value. This would point to positive potential growth for this sector in coming years as more African states adopt regulation permitting Block-Chain development and as Block-Chain is adopted more widely across industries.
