Seychelles blockchain startups raised $100 million from six deals while South African startups raised $29 million from 4 deals, according to the CV VC Africa Blockchain report.  Seychelles has led blockchain funding in Africa for six consecutive years.

“South Africa and Seychelles are two of the six markets where crypto is legal in Africa and regulatory assuredness is important for investment in [blockchain startups],” Brenton Naicker, principal and head of growth of CV VC told TechCabal.

Despite the easing of crypto regulations across the continent, crypto is still banned in 12 countries, and 36 more countries have “uncertain” regulatory frameworks, per the CV VC report.

Seychelles startups that raised funding in 2023 include Beldex, which raised $28 million, crypto exchange Bitget, which raised $10 million, and Scroll, which raised $83 million. In South Africa, Momint raised $2.7 million, while NFTfi secured $18 million.

Despite the dominance of Seychelles and South Africa, other markets, including Nigeria, are on the rise. In H1 2024, Nigerian startups raised $13 million in funding from five deals, accounting for 38% of total funding by African startups.

Some funded Nigerian blockchain startups include fiat-to-crypto exchange Zap Africa and real estate tokenisation startup Seso Global which have raised $300,000 and $720,000, respectively.

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The decline in equity deals continues despite startups refocusing on becoming profitable and taking cost-cutting measures including layoffs.

“There’s no glossing over some of the difficulties the African tech ecosystem has seen in the period under review as layoffs continued and mega deals were nowhere to be found,” the report said.

The number of equity deals halved and the value of the investments reduced by 24%, year on year, according to SOTIA. Founders secured the most funding from debt deals, about $254 million.  

However, venture deals remain the most common form of funding, and most of it went to early-stage startups. In 16 rounds pre-seed startups raised about $12.9 million. As seed-stage startups raised $66.2 million in 20 rounds.  But the most venture deal funding—$155 million— came from only 4 series-B rounds. 

The least funding came from grants—$12.7 million.

In this persistent decline, most of what has remained the same is the destination of the funds. Investors continue to show confidence in the Big Four. Egypt, South Africa, Nigeria, and Kenya accounted for 65% of the funding. 

However, that may change soon, as Benin and Ghana raised—$50 million and $18.6 million respectively— more funds than Nigeria and South Africa in Q2 2024.

More new developments can be seen in the sector investors favoured in H1 2024. Fintech which got $863 million in H1 of 2023 lost its first place to the logistics and transportation sector which raised over $218 million. The fintech sector got $185 million, followed closely by the energy and water industry, which attracted about $132 million.

The telecom, media & entertainment industry was most impacted by the funding crunch,  raising only 3.5 million, its lowest since 2021, per the report.

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The fund received backing from institutions like Bpifrance and the Dutch Entrepreneurial Development Bank.  Breega plans to invest between $100,000 and $2 million in at least 40  across Nigeria, Egypt, South Africa, Kenya, Morocco, Senegal, Ivory Coast, Cameroon, and the DRC. 

Breega, self-described as one of the fastest-growing VC firms in Europe, joins TLcom Capital and Partech—major European VC firms—that closed their Africa-focused funds this year.  This signals continued VC interest in Africa’s tech ecosystem despite increased investor cautiousness as indicated in the 36% decline in VC funding in 2023. 

Africa Seed I wants to lead pre-seed and seed rounds in the continent’s agritech, edtech, health tech, fintech, logistics, mobility, energy, and climate tech sectors but also promises to support potential portfolio companies in other ways. 

 “Our goal is to be the investors we wished we had while building our businesses,” Lubega said in an interview.

The VC has previously backed nine African startups: Numida, Klasha, Socium, Coachbit Kwara, Sava, and Hohm Energy—its most recent investment. The firm also recently opened offices in Lagos and Cape Town.

The company has spent the past two years mapping African cities and identifying potential markets. It claims to be the largest operator of electric motorbikes in Africa and has mostly focused on two-wheelers. 

It has 11,000 motorbikes and 300 battery-swapping stations in Benin and Togo where it first launched. It has deployed 800 motorbikes in Kenya since its September 2023 launch in September 2023 and 300 motorbikes in Rwanda. It plans to launch 1000 motorbikes in Uganda before the end of 2024. 

“We want to do 1 million units of 2-wheelers in five years,” said Kaushik Burman, CEO in Kigali where the African CEO Forum was held. 

Burman believes a sustainable electric vehicle environment integrates all the different facets of the industry. Hence, beyond building fast battery recharge and swapping stations, the company is investing money in Internet-of-Things technology, maps, and a ride-hailing application. 

“It is like Uber but it doesn’t need bikes. But we are making bikes and we are going to be like Uber with a ride-hailing app,” Burman said. In addition, the app will integrate a payment feature and be accessible to both drivers and riders. 

The technology features will also enable the company to trace the motorbikes and the batteries, and track usage. Behind the multilayered ride-hailing platform and technology features is a team of 50 engineers working out of the company’s innovation centre in Pune, India.

Investors have funded BasiGo, Roam, Max, and Spiro, to offer electric vehicles on the continent. With an estimated market size of$15.80 billion in 2024,  it is expected to reach $25.40 billion by 2029, data from Mordor Intelligence shows. 

The logistics startup, which operates in 15 Nigerian cities, will use the funding to expand into Kenya and other Nigerian cities. 

Renda’s $1.9 million pre-seed raise continues a strong year for logistics and transport startups on the continent. According to Techcabal Insights, startups in the sector raised about $151 million in Q1 2024.

The funding round was led by Ingressive Capital, with participation from Techstars Toronto, Founders Factory Africa, Magic Fund, Golden Palm Investments, Reflect Ventures, SeedFi and Vastly Valuable Ventures.  

E-commerce companies need efficient last-mile delivery and warehousing solutions, and it may not make business sense for them to handle those parts of the business. So startups like Renda, which provide warehousing, delivery and cash collection, are valuable.

Like many other startups in the logistics space, Renda claims to be asset-light and does not own any warehouses or trucks. Instead, it fulfills orders with the help of over 5,000 warehousing, delivery and cash collection partners. 

The startup, which generates revenue through year-long contracts with businesses, is profitable, said CEO Ope Onaboye. “The growth also speaks to the kind of customers  who use our solution.” 

Renda serves businesses like Jumia, Omnibiz, LaCasera, MarketForce, and CDcare and claims to have processed 250,000 orders since it launched. 

Founded in 2021 by siblings Ope and Bimbo Onaboye, Renda began providing warehousing and logistics needs for small and medium-scale enterprises (SMEs) before moving to serve FMCG and e-commerce businesses due to higher margins. Through its app, Renda360, companies can access flexible storage, monitor and manage their inventory, process and fulfil orders, manage deliveries and returns, and receive and reconcile cash on delivery in real time.

“Joining forces with Renda as an investor is a strategic move for us. Renda’s technology solution addresses a critical need in the African manufacturing and e-commerce ecosystems, offering seamless access to fulfilment infrastructure,” Maya Horgan Famodu, Founder and Partner at Ingressive Capital, said.

Renda plans to expand into Kenya and will explore the possibility of an asset-heavy model. “Our vision at Renda is to become the largest and most trusted fulfilment partner for e-commerce and major businesses across Africa,” Onaboye told TechCabal. 

It took over two years to reach and surpass the funding target. Maurizio Caio, founder and managing partner at TLcom Capital, said the delay was because they received large investments requiring some documentation adjustments.  

TIDE Africa II is roughly two times the size of TLcom’s first fund ($71 million), which closed in February 2021. 

Startup funding in Africa has slowed since 2022 as global venture capital appetite declined. In 2023, African startups raised $3.2 billion, the lowest figure since the $2.1 billion in 2020. As foreign capital gradually disappeared from the ecosystem, led by the exodus of 400 unique investors, local venture capital firms like TLcom have stepped up.  

The VC firm starts investing at the seed stage or Series A and follow-up capital for portfolio companies that have reached their growth stages.

“The $1 to $3 million range is the range of our first check,” Caio said. 

TLcom Capital also plans to fund female-founded tech startups. With a commitment of $2 million, TLcom was an early investor in FirstCheck Africa, a female-focused pre-seed fund launched in January 2021. 

The company’s ambition is to show the global VC market in the next three to five years that the African tech ecosystem can bring in great returns. It is targeting investments in 20-25 startups.

“We are maintaining the same investment strategy for TIDE Africa Fund II as we had for our first fund, which made over 80% of its investments at Seed or Series A,” Caio said. 

Investors in the TIDE Africa Fund II include the European Investment Bank (EIB), Allianz, DEG Impact’s joint venture, AfricaGrow, Visa Foundation, and Bertelsmann.  

Apart from expanding to Egypt and South Africa, the new fund enables TLcom to partner with African founders to tackle the continent’s biggest and most complex challenges with innovative solutions. 

TIDE Africa Fund II has already been deployed in South Africa and Egypt with Cape Town-based LittleFish, a software company enabling payment and banking products for retail-focused SMBs, and Cairo-based ILLA, a middle-mile logistics company. 

The exact funding amount was not disclosed. Pharmacy Marts raised  $2 million in funding from investors since its launch.

“We are excited about having Acasia Ventures on board, given its great presence in African markets that we are planning to enter, as well as their solid network of advisors and experts in the pharmaceutical industry,” CEO and Co-Founder of Pharmacy Marts Ahmed Kadous said.

Founded in 2021, Pharmacy Marts allows pharmacists to access medical products and connect them with suppliers. It also provides access to working capital and long-term financing, including “Buy Now, Pay Later” options. Pharmacy Marts claims it currently services about 12,000 of Egypt’s pharmacies, equivalent to 20% of the total market, and boasts over 200 suppliers on its platform. The startup says it aims to digitize the pharmaceutical sector’s supply chain to improve patient access to medication.

“In a short period, Pharmacy Marts has emerged as a category leader in this space and we are confident it will continue to go from strength to strength,” Managing Partner at Acasia Ventures Aly El Shalakany said.

Rwandan-based startup Kasha, Kenya’s Maisha Meds, and Egypt-based startups Dawi Clinics and Chefaa cumulatively raised $52 million across 33 deals, and were responsible for a 2,000% increase in funding to women-led companies in Africa’s healthtech industry. 

According to Jessica Vernon, CEO of Maisha Meds, her company’s funding came from solving problems with a business model that’s different from competitors. “We’re meeting people where they first go to get care: at private drug shops, pharmacies, and clinics. And we’re using technology to make those places more digital, efficient, and accessible,” Vernon told TechCabal. 

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In 2022, women-led companies in healthcare were only able to raise $2 million across 26 deals representing 1.4% of all healthtech funding. The report from Salient Advisory noted that Kasha’s $21 million Series B funding was the largest investment ever made in a woman-led health tech company in Africa. Additionally, funding to mixed-gender founding teams rose to 21% in 2023 from 10% in 2022. 

The funding in these companies follows what the Salient Advisory report described as an impressive year for the general healthtech space, which received $167 million in 2023. While the general healthtech funding was 2% lower than what investors deployed in 2022, it was better than the broader African tech ecosystem, which saw a 39% funding decline. 

Women-led startups in Africa have, over the years, been largely overlooked by venture capital and private equity investors. But 2023 was a relatively good year for gender financing. Women-led startups raised just above $200 million, a +7% positive growth on a year-on-year basis, data from Africa: The Big Deal showed. 

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The 2,000% funding growth is the first time the gender financing gap in health tech startups —and the ecosystem in general— is narrowing. The funding accounted for 31% of the total investment in health tech companies in 2023.

Investors in Maisha Meds and most of the other women-led companies include global development institutions such as USAID and the Bill & Melinda Gates Foundation. Funding from these institutions is mostly grants. 

Maisha Meds raised $5.25 million in scale-up stage 3 funding from USAID Development Innovation Ventures (DIV). Stage 3 grants are DIV’s highest level of funding awarded to innovators who have demonstrated the ability to scale up their proven solutions to critical challenges. 

Grants from institutions like the Bill & Melinda Gates Foundation, MSD, Cencora, Microsoft, and Chemonics have contributed to setting up women-led companies in health tech and the space in general. The report noted that over half (52%) of the 145 deals for African healthtech innovators in 2023 were grants indicating the important role that grants play in bridging funding gaps for early-stage healthtech innovators. This stands out as the largest source of grant funding on the continent. However, the total ticket size of grants was only 7% of the funding raised, with the average being $168,000. 

Equity funding in comparison, accounted for 91% of funding raised, with an average ticket size of $3.2 million. Experts say there are still barriers women founders or CEOs face in accessing private equity or venture capital funding.

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These barriers are not necessarily from investors’ bias against female founders or CEOs, but they could stem from these women prioritising things like family over their business, hence they don’t show up enough for investors to see them, according to Ibijoke Faborode, founder of Africa Female Founders Collective (AFFC).  

AFFC which launched in February is planning a programme in 2024 that helps women founders or CEOs create more time for their startups and meet more investors who are interested in investing in their sectors. The goal is to help these startups focus on building the innovations that make them attractive to investors and also address problems in society.

Vermon pointed out that the specific women-led startups that were funded in the DIV round are those that are innovating on unique models for healthcare delivery, including a major emphasis on the last mile and underserved populations.  

Amaan Khalfan, CEO of Goodlife Pharmacy, East Africa’s largest private retail pharmacy chain, said investors would largely fund a business that has good record keeping and can position itself in a way that identifies the opportunities in the health tech space.

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Jenne Nwokoye, founder of Clafiya, a digital health platform that has raised  $610,000 to date mainly from venture capital, said women-led startups are not raising much from VCs because there is little intentionality behind funding women-led businesses. 

According to Nwokoye, it would help if more VC funds were run by women entrepreneurs. However, she notes that women need to be more open in sharing funding opportunities. 

“For the next funding cycle, I’m going to be more intentional with the investors I want, i.e. finding investors who understand health, consumerism, and finance in Africa or in general,” she said. 

Founded in  2021 by Tim Ohlsen and Emir Gluhbegovic Hohm Energy’s platform comprises two offerings; a way for customers to have their properties’ solar energy requirements determined digitally and a way to get access to credit financing for rooftop solar installation. The platform also allows solar installers to design, manage, finance and procure solar projects. 

Hohm Energy claims to have generated over 17,000 custom solar rooftop designs worth $190M and $90M in financing applications for the implementation of the designs. 

To facilitate financing for the designs, Hohm Energy has partnerships with several South African finance institutions for customers to secure structured financing. 

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Through the partnerships, Hohm customers can use the platform’s finance and credit scoring to apply for financing. “We realised that although there is an appetite for solar energy in SA, sometimes financing is a hurdle,” Ohlsen told TechCabal. “The fintech aspect will help to drive even more rooftop solar installations.”

The company will use the funding to scale its product offering across the board. This will include its tech, product innovation and solar installer skills development. Ohm Energy aims to facilitate rooftop solar installations for 7.7 million homes in South Africa and claims to be on track to reach profitability by the end of the year.

The $14 million Series A funding round was led by Equator Africa and participation from At One Ventures, TES Ventures, Renew Capital, The World We Want, and One Small Planet, among other prominent private and institutional investors. The $10 million debt facility was provided by the International Development Finance Corporation (DFC). 

The funding is significant and comes at a time when attention is shifting to electric vehicles as countries around the world make efforts to make the environment safer. EV sales are projected to reach 16.7 million in 2024, representing a 20% increase from the previous year, according to estimates from the BloombergNEF. Roam which designs, develops, and deploys electric motorcycles and buses said it has managed to capture or mitigate over 120,000 tonnes of carbon emissions. This is primarily the inspiration for investors like DFC in Roam. James Polan, Vice President of the Office of Development Credit at DFC said the debt facility to Roam aligns with its goals for a cleaner future. 

But transitioning to electric vehicles isn’t cheap with the price of batteries and building infrastructure for rollout making the cost for individual owners very expensive. The Kenyan government, however, is undeterred, as they have set a 5% target for new vehicles to be electric by the end of 2025. Roam and its rival BasiGo are at the forefront of ensuring the target is achieved by providing cheaper options for consumers in the country.   

Roam offers riders in the East African country payment flexibility and the option of battery ownership. This lets users charge their batteries at a standard household outlet and significantly reduces the cost of operations while increasing the ability to travel longer distances. 

“As Africa embraces the move toward electric vehicle technology, we are proud of our impact on the environment and livelihoods across Kenya and the wider continent. This funding is a critical step for Roam to achieve our strategic objectives in scaling up and increasing utility to our customers,” said Rajal Upadhyaya, chief financial officer of Roam. 

In line with the expansion, Roam will increase the utility of its motorcycles to riders through the deployment of Roam Hub stations. These are multiple open-architecture electric motorcycle charging stations that offer a wide array of after-sales services including the option to rent batteries for a flexible period.

“At Equator, we are committed to building a future with efficient, accessible, and sustainable mobility. Roam’s innovative electric mobility platform is at the forefront of this transformation, and we are proud to provide catalytic funding that will enable Roam to build a cleaner, more equitable future for African cities,” said Nijhad Jamal, partner at Equator.