Q3 Venture Capital

2024 Activity in Africa

Global Venture Capital
Despite early signs of stabilisation in the second quarter that fostered cautious in the UK and France which affected regional totals in Q3. Latin America, Africa’s
optimism for industry recovery, global venture capital continued its downward closest economic and developmental comparator, closed out Q3 with just under
trajectory in the third quarter of 2024. Total funding declined to US$67 billion US$0.9 billion deployed, driven by capital deployed at the early-stage.
across approximately 5,300 deals, representing a 15% decrease in value and a
One of the most prominent trends in Q3 2024 was the reduced number of
30% decrease in volume compared to the same period in 2023.
mega-rounds (deals exceeding US$500 million), which contributed significantly
North America remained the dominant region for venture capital, accounting for to the year-on-year reduction in global deal value. Despite the overall cooling
61% of global funding with US$40.6 billion invested in Q3 2024. While dominant, of venture capital activity, artificial intelligence (AI) continues to be a sector of
it has not been immune to the broader market slowdown, with deal volumes notable interest, particularly in North America. In Q3 2024, AI companies in the
continuing to shrink. Although Asia secured US$13.2 billion in venture capital during region raised US$15 billion, underscoring the ongoing belief in AI’s transformative
the quarter, the region’s grip on second place grows increasingly tenuous following potential across industries 1. While AI is one of the few sectors experiencing growth,
significant contractions in both deal value and volume. Coming in third, Europe saw its impact has not been sufficient to reverse the broader market decline. These
US$10.2 billion invested and is on track to outpace Asia, despite market fluctuations shifts highlight an increasingly discerning investment climate, where investors

Figure 1: Volume and Value (US$bn) of Global Venture Capital, 2021- Q3 2024
190 15000
173 176 171
155 12000

VC Deal Volume
128 Quarterly Average (’21-’23)
9000
86 81 79
78 79
71 66 68 67 6000

3000

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2021 2021 2021 2021 2022 2022 2022 2022 2023 2023 2023 2023 2024 2024 2024

Volume Value (US$bn)

Source: Crunchbase 2024 Global Funding Report

1 Crunchbase, 2024. North American Startup Funding Weakened In Q3 As Largest Deal Took Longer To Close

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
are prioritising low-risk, operationally sound companies with clear, demonstrable Africa and Asia, on the other hand, suffered twin trajectories in the third quarter.
paths to profitability. In the face of ongoing macroeconomic uncertainty, there is Both regions recorded nearly 50% declines in venture capital deal value compared
a heightened focus on startups with strong business fundamentals, raising capital to Q3 2023. In Asia, the drop was largely attributed to a sharp fall in late-stage
not out of operational necessity but to support long-term growth. and growth deals, which raised just US$5.8 billion: a 62% decrease from the
previous year2. Bilateral tension with the United States, the subsequent exodus
of foreign investment, dwindling valuations of Chinese companies, and the
Africa in the Global Context lasting effects of government crackdowns on Big Tech have collectively created a
subdued environment for entrepreneurial and venture capital activity in China3—
Q3 2024 revealed significant disparities in global venture capital activity, with traditionally a growth engine for the Asiatic region.
North and Latin America standing out as the only regions to record increases in
deal value year-on-year. North America’s 14% YoY increase translates to US$3 For Africa, the reduction in venture capital flows is largely due to the retreat of global
billion increase in Q3 2024 compared to Q3 2023, while Latin America’s modest investors (particularly from North America) who had opportunistic rather than
13% increase amounted to just US$100,000 more than the previous year. Despite dedicated mandates for African investments. Additionally, capital is increasingly
the positive year-on-year comparison for both geographies, funding margins being concentrated in already-backed startups led by more established founders.
between Q3 2023 and Q3 2024 in Latin America were marginal, indicating that This shift toward doubling down on existing investments has resulted in fewer
the region’s funding environment has seen little improvement. deals overall and a notable decline in aggregate funding, further amplifying the
region’s challenges in attracting capital amidst global economic uncertainty.

Figure 2: Global Comparison of YoY Changes to VC Deal Volume & Value, Q3 2024

Global North America Europe Latin America Asia Africa

14% 13%
YoY Change (Q3'23 vs. Q3'24)

-15% -17%
-23%
-30%
-36% -37% -39%
-47% -44% -46%

Volume Value (US$bn)

Source: AVCA Database & Crunchbase 2024 Global Funding Report

2 Crunchbase, 2024. Asia Venture Funding Hits 10-Year Low In Q3

3 Financial Times, 2024. How China Has ‘Throttled’ Its Private Sector

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
2024 YTD IN REVIEW

A Measured Year: 2024 On Track For Lowest Performance remains relatively insulated, benefiting from the historical abundance of seed-
Since 2020 stage investments that have created a steady pipeline of companies transitioning
to the early stage.
Venture capital activity in Africa has slowed considerably in 2024. In Q3, venture
capital funding reached just US$507 million across 108 deals in a steep decline
by both volume and value compared to previous years. This brings the total for West Africa Dethroned, North Africa Surpasses All Regions By
2024 YTD to US$1.2 billion raised over 313 deals and paints a sobering picture for
the continent’s startup ecosystem in what is shaping up to be a year of modest
Both Volume & Value
performance for venture capital. North Africa emerged as the top performer in 2024, claiming a total US$368 million
from 78 deals by the end of Q3. After a mixed performance in the first half of 2024,
Looking ahead, 2024 is on track to deliver a conservative three quarters of the
North Africa was buoyed by several high-value funding rounds in Q3, particularly in
deal volume reached in 2023, should the present dealmaking pace continue into
Egypt’s financial services sector. Notable deals included US$34 million pre-Series
Q4. In terms of deal value, the bigger picture is even bleaker: the continent may
A raised by FlapKap and US$22 million Series B extension secured by Paymob.
end the year with only half of the venture capital flows it recorded in 2023. For
This surge helped dethrone West Africa, which typically leads the continent, but
context, Africa’s venture capital market raised US$3 billion across 405 deals by
slipped by 32% YoY to stand at 73 deals by Q3 2024. West Africa’s decline by deal
the end of Q3 2023, underscoring the notable decline in investor activity to date
volume is mirrored in its shrinking deal value, which has fallen to US$185 million
in 2024.
year-to-date in 2024, compared to US$327 million in 2023.
East and Central Africa have both remained stable in 2024, with East Africa
A Pinch at the Early Stage, A Punch at the Late maintaining consistency quarter-over-quarter, while Central Africa held steady
year-over-year. East Africa secured 75 deals year-to-date, reflecting sustained
Venture capital activity across all investment stages have witnessed significant investor interest, though the region saw a decline in deal value, raising US$196
contractions in the year to date. The late stage was the hardest hit with only two million in 2024 compared to US$480 million in 2023. Similarly, Central Africa
deals completed by September 2024, down from seven such deals that took maintained stability with 7 deals so far in 2024, in line with previous years.
place within the same period in 2023 (a 71% YoY decline). This drop reflects the However, the region continues to struggle in attracting significant capital, raising
increasing difficulty of and need for more mature startups to demonstrate growth, just US$6 million in 2024, primarily from seed-stage companies securing their first
profitability, and a judicious burn rate of operational capital in order to secure rounds of funding.
follow-on funding. Compounding this challenge is the increasingly competitive
fundraising environment for fund managers, which has reduced the availability of
deployable capital in the market and further contributed to the scarcity of funding.
FinTech Expands Dominance in African VC, AI Crosses Verticals,
The seed stage also saw a 43% decline in deal volume, with 87 deals closed and CleanTech Gains Momentum
in 2024 YTD. Despite this contraction, median deal sizes at the seed stage are
trending upward, now averaging US$1.9 million, compared to US$1.2 million FinTech and Digital Banks remain the beating heart of venture capital in Africa,
in 2023. Similarly, the early stage shrunk by approximately a third by both deal encompassing innovations in cryptocurrency, digital payments, mobile wallets,
volume and value. 37 early stage deals totalling a combined US$530 million were and embedded finance solutions tailored to the continent’s unique needs. One in
completed in 2024 by the close of Q3 - falling shy of the (still modest) US$857 three tech-enabled startups (32%) that raised funding in 2024 operate within this
million raised within this market segment the previous year. However, this stage vertical, collectively attracting US$564 million in venture capital to date.

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
While FinTech dominates, the rise of Artificial Intelligence (AI) is shaping multiple despite the overall decline this year, investors are still deploying capital at scale for
sectors. AI’s cross-vertical applications—spanning from predictive analytics in startups with stable fundamentals and demonstrable growth. The rise in average
FinTech to optimising grid management solutions in Clean and ClimateTech— deal sizes across some market segments reflects this trend, with seed-stage deals
have fuelled its growth. AI deals now account for 13% of venture capital activity increasing from US$1.8 million in 2023 to US$2.4 million in 2024, and early-stage
directed to tech-enabled startups, placing it alongside CleanTech as one of the deals rising to an average of $16.1 million. Even the late-stage segment, where
most funded verticals. This composition of capital flows highlights the growing the funding pullback has been most pronounced, saw some high-value rounds for
investor preference for sectors that combine sustainability, scalability, and resilient companies. Examples include Egypt’s MNT-Halan and Nigeria’s MoniePoint,
technological sophistication. which secured $160 million and $110 million respectively. These trends hint at
continued capital access for high-performing startups, and in the medium term
may result in a gradual return to growth for both deal volumes and values.
Venture Debt Grows in Size and Frequency
Q3 2024 saw 9 venture debt deals completed in Africa, totalling US$317
million. This brings the cumulative value for 2024 to US$755 million across 40
A New Normal?
deals, highlighting the growing prominence of venture debt as a key funding As venture capital navigates this funding downturn, a key question lingers: is
mechanism for African businesses. Notably, the deals in Q3 exhibited strong the current landscape here to stay? Today’s figures—just under US$2 billion
sector concentration, with recipients primarily operating in the Financials (56%), raised so far in 2024, with the inclusion of venture debt—already surpass the
Utilities (33%) and Consumer Staples (11%) sectors. industry’s performance in pre-boom years like 2019 and 2020. However, the
soaring deal activity of 2021-2022, driven by abundant capital in late-stage
One unique trend in 2024 has been the rise of repeat venture debt investments
deals, appear increasingly distant in today’s risk-averse climate. As investors
within the same year. Venture debt is typically leveraged by more established
evaluate opportunities more conservatively, founders may face a reality where
companies raising follow-on rather than initial funding, and is typically raised in
the heightened pace of dealmaking seen in previous years is unlikely to return
successive years. However in Q3 2024 companies like d.Light, One Acre Fund,
soon. With more questions than answers on everyone’s minds, the future for and
UsPlus, and ValU have raised their second or even third venture debt round
direction of Africa’s startup ecosystem remain to be seen.
within the same year—a deviation from the norm. This unusual frequency may be
attributed to the increased availability of tailored credit solutions, or the result of
specific capital needs to support product or geographic expansion.
Venture Debt: A Lifeline For The Road Ahead
In addition, median venture debt deal value continues to rise, standing at US$9.5
Though the duration and long-term impact of the funding slowdown remain
million for 2024 year-to-date, compared to US$5 million in 2023 and US$5.8 million
uncertain, venture debt offers a viable path forward, providing an essential lifeline
in 2022. This upward trend reflects both the growing demand for larger debt deals
as the industry struggles toward the light at the end of the tunnel. By Q3 2024, 40
and the increasing maturity of the companies seeking this type of funding.
venture debt deals totalling $755 million were concluded—steady in volume and
up notably from $633 million across 43 deals at this point last year. For founders
hoping to ride out the downturn, this steady source of capital could be the
The Road Ahead: What’s Next for VC in Africa? strategic cushion needed to navigate the months ahead and position for success
Reflections & Outlook for 2024 when the venture capital market regains momentum.

The venture capital landscape in Africa has faced undeniable challenges in 2024,
yet room for (some) optimism remains. As we move into Q4, a modest rebound
in deal activity could narrow the year’s overall decline in volume. Turning to value,

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
A Measured Year: Deal Counts Remain Below The Quarterly Average
Figure 3: Volume of Venture Capital Deals in Africa, by Year & Quarter
250

200

150
Quarterly Average (’19-’23) 112 108
100 93

50

0
2019 2020 2021 2022 2023 2024
Q1 Q2 Q3 Q4

Figure 4: Volume of Venture Capital Deals in Africa by Year, Q1-Q3 vs. Q4

786

650

543

319 313

140

2019 2020 2021 2022 2023 2024 YTD

Q1-Q3 Q4

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
A Measured Year: 2024 On Track For Lowest Performance Since 2020
Figure 5: Value of Venture Capital Deals in Africa, by Year & Quarter
2.5

2.0

1.5

1.0
Quarterly Average (’19-’23)

0.5
0.5 0.4
0.3

0.0
2019 2020 2021 2022 2023 2024
Q1 Q2 Q3 Q4

Figure 6: Value of Venture Capital Deals (US$bn) in Africa by Year, Q1-Q3 vs. Q4

5.3 5.2

3.6

1.5
1.1 1.2

2019 2020 2021 2022 2023 2024 YTD

Q1-Q3 Q4

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
A Pinch at the Early Stage, A Punch at the Late
Figure 7: Annual Evolution of VC Deal Volume by Stage, 2019 – Q3 2024 Figure 8: Annual Evolution of VC Deal Value by Stage, 2019 – Q3 2024
786

5.3 5.2
650

543
3.6

405 3.0

319 313

1.5
1.2
140 1.1

2019 2020 2021 2022 2023 2023 Q1-3 2024 Q1-3 2019 2020 2021 2022 2023 2023 Q1-3 2024 Q1-3
Seed Early Stage Late Stage Series Unknown Seed Early Stage Late Stage Series Unknown

Figure 9: Annual Evolution of Median Deal Size (US$mn) by Stage, 2019-2024 YTD

35.4

7.5
2.5
1.9
2019 2020 2021 2022 2023 2024 YTD

Seed Early Stage Late Stage Median (All Deals)

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
West Africa Dethroned, North Africa Surpasses All Regions By Both Volume & Value

Figure 10: Evolution of VC Deal Volume in Africa, 2021-2024 YTD Figure 11: Evolution of VC Deal Value (US$mn) in Africa, 2021-2024 YTD

North Africa
179 North Africa
132 1160
104
78 642 532 368

2021 2022 2023 2024 2021 2022 2023 2024

West Africa
235 East Africa
208 West Africa
165
142 128 1342 East Africa
114
73 75 815 877
431 380 480
185 196
2021 2022 2023 2024 2021 2022 2023 2024 2021 2022 2023 2024 2021 2022 2023 2024
Central Africa Central Africa
8 8 7 7 18 49 46 6
2021 2022 2023 2024 2021 2022 2023 2024

Multi-Region
Southern Africa 2102
1856
126 120 112 1540 Southern Africa
Multi-Region
672
80 60 51 481 577
47 152
29 326
2021 2022 2023 2024 2021 2022 2023 2024
2021 2022 2023 2024 2021 2022 2023 2024

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
Driving African Consumerism: Financials, Information Technology, and Consumer Discretionary
Dominate in Volume and Value
Figure 12: Share of VC Deal Volume by Sector, 2019 – 2022 vs 2023 vs 2024 YTD Figure 13: Share of VC Deal Value by Sector, 2019 – 2022 vs 2023 vs 2024 YTD

2019 - 2022 2023 2024 YTD 2019 - 2022 2023 2024 YTD

47% 48% 49%

Financials 29% 23% 29%
Financials

Information Technology 16% 20% 19% Information Technology 15%

10% 9%

Consumer Discretionary 15% 17% Consumer Discretionary

14% 9% 10% 12%

Industrials 14% 12% 12% Industrials 16% 12% 9%

Health Care Utilities

8% 9% 8% 7% 9% 4%

Consumer Staples Communication Services

5% 5% 7% 4%
3% 2%

Communication Services Health Care

5% 5% 6% 4% 5% 3%

Utilities Consumer Staples

4% 5% 3% 2% 3% 3%

Materials
1% 2% 1% Real Estate
<1% 1% <1%

Real Estate Materials

2% 2% <1% 1% 1% –

Energy Energy
<1% – <1% <1% – –

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
FinTech Expands Dominance in African VC, AI Crosses Verticals, and CleanTech Gains Momentum

Figure 14: Top Verticals Amongst Tech-Enabled Companies, 2019 - 2023

Rank 1 2 3 4 5

FinTech & Digital Banks E-Commerce HealthTech Clean & ClimateTech EdTech

29%

9% 8% 7%
5%

Figure 15: Top Verticals Amongst Tech-Enabled Companies, 2024 YTD

Rank 1 2 2 3 4 5

FinTech & Digital Banks Artificial Clean & HealthTech AgTech E-Commerce
Intelligence (AI) ClimateTech
32%

13% 13%
9% 8% 7%

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
 Venture Debt Grows in Size and Frequency

Figure 16: Volume of Venture Debt Deals in Africa, by Year & Quarter Figure 17: Value of Venture Debt Deals in Africa (US$mn), by Year & Quarter

20 18
500

400
15
13 317
305
300
10 9

200
133
5
100

0 2022 2023 2024

0 2022 2023 2024
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Figure 18: Evolution of Median Venture Debt Deal Value (US$mn), 2022 – 2024 YTD

2022 5.8

2023 5.0

2024 YTD 9.5

Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org
 Research Methodology
This report maintains the same methodology used in
the full year Venture Capital in Africa series. A detailed
overview of the Research Methodology used can be
accessed here, on pages 45-46.

Championing Private Investment in Africa

Contact AVCA The African Private Capital Association is the pan-African industry body
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programmes and exceptional networking opportunities.
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Venture Capital Activity in Africa Q3 2024 © 2024 AVCA | October 2024 | www.avca-africa.org