Africa’s foremost start up portal, Disrupt Africa, on Tuesday, released a report, which revealed that African technology startups received direct investments to the tune of about US$185,785,500. According to the report, Nigeria, South Africa, Kenya, Tanzania, Egypt and Ghana held outstanding records for tech startup funding, which indicate a progressive trend for tech startups on the continent. Both the solar and financial technology sectors each constituted 32.9 percent of total funds raised.
Of all the countries featured on the report, 36 percent of the startups that raised funding are based in South Africa, 24 percent are based in Nigeria and 14.4 per cent of the startups are based in Kenya. In general, South African startups raised US$54,568,000 throughout the year; Nigerian startups received over US$49,404,000; and Kenyan startups received over US$47,365,000. Although this is the first time Disrupt Africa is conducting this kind of research, the investment figures are pretty outstanding.
The co-Founder, of Disrupt Africa, Gabriella Mulligan expressed enthusiasm over the potential of tech startups in Africa, which show a rising trend in attracting investments.
“2015 was an exciting year for African tech startups. Our data shows the increasing vibrancy of our ecosystem, with more quality tech startups, and more investor activity than ever before. We are very pleased to make our data available in the Disrupt Africa African Tech Startups Funding Report 2015, and trust it will contribute to understanding and growing the ecosystem,” she said.
Ventures Africa spoke with Disrupt Africa’s co-Founder, Tom Jackson to address the issue of accessible funding for tech startups in this part of the world. He believes there are a few challenges in getting adequate funding for tech startups here.
“It is still tough to get funding if you are an African tech startup, but it is getting easier. International investors have traditionally been wary, either through ignorance or the perception Africa is a risky place to invest. Local investors have preferred real estate. But there is a trend towards investors realizing the opportunities in African tech, and backing startups in the sector, this will continue into 2016,” he said.
Due to little information, Jackson made his own deductions on funding figures from 2014.
“I actually think the 2014 total figure will be higher than 2015, but only because Takealot, Jumia and Konga raised huge rounds in 2014 and didn’t need to raise in 2015. More startups outside of South Africa, Kenya and Nigeria have raised than ever before. This trend will continue”, Jackson said.
