African startups raised $2.2 billion in 2024 through equity, debt, and grants (excluding exits), marking a nearly 25% drop compared to the $2.9 billion raised in 2023, according to the latest data from Africa, The Big Deal.
The report highlighted a 10% decline in the number of ventures raising $1 million or more, with 188 such deals in 2024 compared to 2023. However, exit activity showed slight growth, with 22 exits announced in 2024, up from 20 in 2023.
The downturn mirrors a trend from the previous year, which saw African startup funding fall 39% between 2022 and 2023. Despite this, Max Cuvellier Giacomelli, co-founder of Africa: The Big Deal, noted reasons for optimism.
“The relative counter-performance of 2024 is mostly to be blamed on a slow start to the year,” Cuvellier Giacomelli explained. The first half of 2024 saw just under $800 million raised, marking the slowest semester since 2020. However, a strong rebound in the second half of the year brought in $1.4 billion, up 25% year-over-year and 80% higher than the first half.
The late-year funding surge was bolstered by major deals, including those from Moniepoint and Tyme Group, which achieved unicorn status with valuations exceeding $1 billion.
Tyme Group became Africa’s ninth unicorn in December 2024 after securing a $250 million Series D round and reaching a valuation of $1.5 billion. Moniepoint joined the ranks in October 2024, following a $60 million Series C round that pushed its valuation beyond $1 billion.
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The funding decline in 2024 was primarily due to a 40% contraction in debt funding, which accounted for 30% of total funding compared to 38% in 2023. In contrast, equity funding displayed encouraging stability, with $1.5 billion raised in 2024, just 11% below the $1.7 billion recorded in 2023.
Cuvellier Giacomelli remarked on this trend, saying, “It is encouraging to see equity levels stabilizing after taking a big hit in 2023 when this type of funding contracted 57% year-over-year.”
While challenges persist, the resilience shown in the second half of 2024 and the emergence of new unicorns demonstrate the enduring potential of Africa’s startup ecosystem, even amid a global “funding winter.”
