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In the First Quarter, Nigerian Startups Raise $160 Million Despite a Lack of Funding

Despite the slowdown in investment across Africa, Nigerian companies managed to receive $160 million in capital in the first three months of this year, according to a new analysis published by Africa: the Big Deal.

The research states that throughout this time, 87 percent of all startup investments made in Africa went to Nigeria, Kenya, South Africa, and Egypt.

Of the Big Four, Nigeria has the most funding ($160 million), followed by Kenya ($110 million), South Africa ($72 million), and Egypt ($53 million).

“Eighty-seven percent of the investment was channelled to startups headquartered in these four countries, with Nigeria and Kenya attracting the lion’s share. Only a handful of other African nations managed to secure more than $5 million in funding,” According to the research.

African entrepreneurs raised $370 million in disclosed investment across 120+ deals in Q1, according to Briter Bridges’ first-quarter analysis report. This is a 61 percent decrease in funding volume from Q1 2023.

African startups are tenacious in the face of adversity; many are still innovating and developing fresh business strategies to propel the industry’s expansion.

According to the research, “The key now is for investors to recognise the potential of the African tech ecosystem and provide the necessary support for these startups to thrive,”

According to Prashant Matta, SP of Panache Venture, speaking to BusinessDay, the reduction in investment is a global problem that is made worse by persistent economic difficulties such as recessions, inflation issues, and downturns.

Nonetheless, given the large acquisitions that were reported in Q1, investors have high hopes for Nigerian businesses.

“The $100M+ deal into Nigerian mobility fintech startup Moove. Similar to other mega-deals, this funding came from outside of Africa. Two investors from the Middle East participated in the mega-rounds in both quarters, Mubadala and Chimera Investments.” it read.

first quarter of this year, with a total of 14 deals for $151 million.
“Transport and logistics snatched the number one spot in terms of the total amount raised. Africa Moove’s startup raised $110 million in Q1 2024, and Uber’s $100 million series B round attracted more than 24 percent of the funding on the continent in Q1.”

With $105 million, fintech received the second-highest amount of capital. Subsequently, $50 million was raised for food and agriculture, $49 million for energy, and $45 million for healthcare.

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