African startups raised $1.4 billion in the first half of 2025
Meanwhile, fintech continues to dominate.
After a bruising 2024, Africa’s startup ecosystem entered 2025 cautiously, hoping for a rebound, but not betting on one. Now, with the first half of the year behind us, the signs are clear: investors are writing bigger checks again.
Startups across the continent raised $1.4 billion in H1 2025, according to Africa: The Big Deal, up 78% from the $800 million posted a year ago. June alone accounted for $365 million, the best single month since 2022, and lifted the six-month average to $237 million, compared to just $133 million in H1 2024.
But what looks like a comeback on the surface is more complex under the hood. A deeper look reveals that funding is flowing faster, yes, but mostly toward a handful of countries, sectors, and deal structures. This isn’t a rising tide lifting all boats. It’s a wave of momentum concentrated in specific corners of the ecosystem.
One of the clearest shifts is the return of big checks
H1 saw 39 deals worth $10 million or more, the most in two years, and 21 exits, nearly matching the combined total of 2023 (20) and 2024 (22). Those are signs of maturity and renewed investor appetite, but they’re clustered: South Africa and Egypt each crossed the $300 million mark for the first time since 2023.
South Africa led with $344 million, powered by deals like hearX’s $100M merger and Stitch’s $55M Series B. Egypt followed with $339 million, largely through alternative financing routes, including a $75M raise by proptech Nawy that combined equity and debt, a $59M sukuk by Bokra, and a $50M bond from Tasaheel.
These deals hint at another subtle but important trend: the growing role of debt.
Kelechi Edeh
Of the $1.4B raised, about $950 million came from equity — up 79% YoY — but debt deals also rose 55% to $400 million, driven by a sharp uptick in June. Wave’s $137M debt raise in Senegal helped make it the strongest debt month in over two years. The shift matters because it reflects how startups, particularly in fintech and mobility, are accessing capital in different ways, often without dilution, and with more complex deal structures that signal a maturing ecosystem.
That said, not all markets are sharing in the upswing.
Kenya raised $227 million, its lowest half-year total since 2021, but managed to hold third place thanks to big clean energy plays like Burn Manufacturing ($85M) and PowerGen ($55M). Nigeria, long the continent’s funding leader, dropped to fourth place for the first time since 2020, pulling in just $176 million. That’s a stark fall, especially given that Nigeria tied Egypt for the most $100k+ deals and ranked second in $1M+ rounds. The activity was there, but not the scale: its top raises, LemFi ($53M), OmniRetail ($20M), and Arnergy ($18M), were outshone continent-wide.
Meanwhile, fintech continues to dominate.
The sector attracted 45% of all capital in H1, around $640 million, and many of the top deals, from Wave’s debt round to Bokra’s sukuk and Stitch’s Series B, show just how much fintech has grown up. It’s no longer just about mobile wallets and payment rails; today’s fintech startups are blending revenue models with flexible financing structures that banks and private credit funds are finally willing to back.
Still, the funding landscape is diversifying. Energy brought in 20% of the total funding at $220 million (mostly in Kenya), healthcare was buoyed by hearX’s landmark deal to take up 11%, and proptech showed rare strength with Nawy’s $75M raise. Climate tech, a broad but rising category, captured 21% of total funding and nearly a third of $100k+ deals. That’s no coincidence as climate-related bets are drawing increased global attention, and African startups in this space are beginning to see more follow-on capital.
Yet despite the gains, this isn’t a return to 2022 euphoria.
Investor participation remains muted: only about 330 investors backed deals in H1 2025, up slightly from last year (300+ investors), but still less than half of 2022’s peak (700+). And the mid-market, especially growth-stage startups looking for $10M–$50M rounds, remains underserved.
So while the numbers are trending up, the rebound isn’t evenly distributed. Africa’s startup ecosystem is showing pockets of resilience, with strong performances in South Africa, Egypt, and fintech.
But investor caution hasn’t fully lifted. The second half of 2025 could solidify the recovery, especially if Nigeria’s rumored megadeals close and capital keeps flowing into scalable climate and energy bets. For now, though, it’s a comeback stitched together by bright spots, not yet a full-blown surge.
Kelechi Edeh
