A recent report by ‘Africa: The Big Deal’ reveals that African startups raised a total of $56 million in August 2024. Nigeria accounted for 14% of this amount, thanks to a single raise by fintech company Waza, which secured $8 million in funding.
Waza’s funding consisted of a $3 million seed equity round and $5 million in debt funding. This deal was one of the three largest in August, alongside Dutch DFI FMO’s $10 million investment in Ghanaian fintech Fido and Solarise Africa’s $9 million announcement.
However, August saw a significant decline in funding compared to July’s record $443 million. This represents an 87% drop and makes August the second-slowest month in four years.
The report highlights that the majority of funding raised in August was in equity (87%), with debt and grants making up the remaining 13%. A total of 27 startups announced funding in August, below the monthly average of over 40.
Nigeria’s startup scene has experienced a slow year in terms of fundraising. In July, only one major funding deal was recorded, and August saw only one deal as well. This is a significant decline from previous years, with Kenya now leading the continent in startup funding.
In the first half of 2024, Kenyan startups raised $244 million, while Nigeria secured $172 million. Egypt and South Africa followed with $101 million and $85 million, respectively.
Despite this decline, Nigeria still accounts for 29% of the total $15 billion invested in African startups over the last five years.
The report suggests that surpassing the July record may be challenging for African startups in the remaining months of the year, given the global funding drought. However, the continent’s startup scene remains promising, with innovative companies like Waza leading the way.
