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As VC activity has slowed globally over the past year, Kenya missed opportunities to record the strongest growth in funding raised in Africa. According to reports, the deal count and price for the country will exceed the 2021 figures, increasing the interest of investors.
According to the data obtained from the market intelligence firm Briter Bridges and The Big Deal, Kenya in 2015 It is more than double the $1.1 billion raised by East Africa’s largest economy in 2021, when the continent is set to collect $5 billion.
Another Partech report, which does not include Sun King’s mega tour, shows that Kenya’s funding rose by 33 percent last year.
Partech ranks Kenya fourth in its list of top VC destinations after Nigeria, South Africa and Egypt. The four markets account for more than 70% of all VC funding in Africa.
Briter and Big Deal, which rounded out the country rankings this year, put Kenya in first place after Nigeria, raising $1.2 billion, despite a decline in the number and value of deals. Compared to last year, the amount invested in Nigeria has dropped by more than 36%, according to Partech and 20% according to Big Deal data. South Africa’s funding stagnated as Participating, while Big Deal data showed a 42 percent decline.
The reports show that Kenya has made strong progress on the continent with Egypt’s VC funding growing modestly. Overall, Africa reported an increase in investment rates last year. Partech put up $6.4 billion, Briter Bridges put up $5.4 billion and Big Deal put up $4.8 billion.
Clean technology and e-commerce
VC interest has increased in almost all sectors in Kenya; But cleantech, e-commerce, fintech, and food and agriculture verticals have accounted for the lion’s share of the activity.
The cleantech sector has received the most VC interest in Kenya, with private venture-backed companies accounting for nearly half of the total capital raised in Kenya – with funding from Sun King’s mega round and M-Copa. Both are providers of PAY-Go scale-ups solar home systems, but the M-Copa platform now includes financing for a variety of products and services.
Other clean-tech ventures that have attracted venture backing include Basigo, an EV startup trying to electrify Kenya’s public transport sector, which is currently dominated by fossil-fuelled buses.
Investors’ clean tech ventures match a global trend over the past year of more capital being pumped into businesses that reduce climate change. The heights of clean and climate technology and the narrow financial slowdown in Africa are expected to continue to attract VC dollars.
scale-ups in the e-commerce sector such as Wasoko and MarketForce; B2B platforms allow informal traders to source goods directly from manufacturers and distributors. And Copia, an e-commerce platform, has also brought in investors by tapping its network of agents to serve rural customers. The large rounds mentioned above saw vertical emergence as one of the most positive effects of VC funding.
As Africa continues to grow as the world’s second-fastest payments and banking market, fintech continues to attract the continent’s largest capital base. However, in Kenya, vertical was third in VC preference, assessed by deal value. On the other hand, the vertical experienced the biggest movement in deal numbers.
Meanwhile, while Kenya has seen significant growth in the past year, some businesses such as Kune and WeFarm have suffered losses, while others such as Twiga, Sendy and MarketForce have downsized their workforces, leaving the market unscathed due to a slowdown in VCs. Fundraising facts.
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