Investors were in no hurry to sign cheques in March, and the African startup funding space felt it. After a good start in 2025, with nearly $300 million secured in January, the rate didn’t just slow down—it collapsed.
By the end of March, only $50 million had been raised, one of the worst months for African startup funding since late 2020.
As revealed in the latest report by Africa: The Big Deal, the impact was a first-quarter total of $460 million—just 5% lower than Q1 2024’s $486 million, but that’s hardly reassuring.
The previous year wasn’t great either, and this quarter now ranks as the second-worst since 2020. The number of startups raising at least $1 million remained stable at 52, keeping pace with the 2023–2024 average. But the bigger issue is no big deals, no momentum, and no sign of improvement in March.
As usual, the bulk of the money flowed into the continent’s established tech hubs. Kenya, Nigeria, and South Africa each pulled in roughly $100 million (24%, 24%, and 22% of the total, respectively).
Egypt followed with $61 million (14%). Togo made a rare appearance in the top five, solely due to Gozem’s $30 million Series B round.
Fintech, the usual magnet for funding, held its grip on the market, attracting 46% of the total investment. Notable deals included LemFi’s $53 million and Naked Insurance’s $38 million. Energy startups secured 18% of the funding, while logistics and transportation claimed 10%.
Female Founders Get Just 1% of the Money
The gender funding gap refuses to close. Startups with female CEOs raised only $10 million in Q1—just over 2% of the total. Strip out grants, and that figure collapses to an abysmal 0.7%. The single largest funding round for a female-led startup was a $6.2 million grant awarded to South African biotech firm African Biologics.
Meanwhile, the industry is still overwhelmingly male-dominated. Solo male founders took 11% of total funding, and all-male founding teams pocketed 67%. Diverse teams—those with at least one female co-founder—secured 20%. But solo female founders or all-female teams? Just 1% of the pie.
The most striking feature of Q1 2025 wasn’t just the drop in funding—it was the absence of major deals. In March, not a single startup announced a funding round exceeding $10 million. That’s unusual, and it raises serious questions about investor confidence.
So, what happens next? The market isn’t in free fall, but it’s not thriving either. Investors seem hesitant, large-scale bets are disappearing, and if this trend continues, African startups could be in for a rough year.
It’s not all doom and gloom, though. The long-term trend still shows resilience, and startup activity hasn’t dropped dramatically. But without major deals to drive momentum, the ecosystem is running on fumes.
