Joy Agwunobi
Africa’s startup ecosystem is once again proving its resilience in the face of global economic turbulence, sustaining investor confidence and attracting capital flows that place the continent on course for another record-breaking year.
Fresh data from Africa: The Big Deal shows that 33 startups across the continent raised a combined $93 million in August 2025 from deals above $100,000. These transactions accounted for 75 percent of all startup fundraising during the month, with Egypt, Kenya, and Nigeria emerging as the top investment destinations.
Cumulatively,the report noted that African startups have already secured $2 billion in 2025, including $1 billion in equity financing. This puts the continent firmly on track to surpass last year’s tally and possibly edge closer to $3 billion by year-end.
The invisible hand of early backers
While headline figures are largely driven by venture capital (VC), mergers and acquisitions (M&As), and institutional money, industry leaders stress that Africa’s innovation pipeline owes its survival to angel investors. These early believers provide the riskiest capital often backing founders with little more than an idea or prototype long before global venture firms step in.
Yemi Keri, president of the Africa Business Angel Network (ABAN) and co-founder of Rising Tide Africa, underscored this point in a recent televised interview.
“These figures you’re seeing today whether VC-driven or M&A-related—reflect businesses that have matured across the value chain and survived the test of time.For them to be positioned for such rounds, they must have received early backing that enabled them to grow into the kind of companies institutional investors can support,” Keri explained.
For angel investors, she added, the pride lies in being the first to take a leap of faith. “We invest when there is little more than an idea, a prototype, or a small founding team. So, when startups advance to acquisitions, IPOs, or late-stage funding rounds, we know our early risks helped make that possible.”
ABAN’s 2024 survey on angel investing across Africa confirmed this outsized role. It revealed that 40 percent of angel capital on the continent flows into pre-seed rounds—the riskiest stage of startup growth, often called the “valley of death.”
Keri elaborated: “At the pre-seed or seed stage, what you are backing may not even be the final product. Policies, governance environments, and macroeconomic shifts can all derail a venture. That is why angels say they invest in the ‘valley of death.’ At that point, a business can either scale into growth or collapse entirely.”
This willingness to commit at fragile moments is what sustains Africa’s startup pipeline, she noted. Without it, many of today’s celebrated venture-backed companies might never have survived their formative years.
The growth of Africa’s angel investing ecosystem is not only reflected in the sheer number of deals, but also in the size of cheques being written and the structures supporting them. What began as small, fragmented bets has matured into organised networks with collective muscle.
“In the early stages of angel investing on the continent, tickets were very small.But over time, people began to come together as syndicates or networks. That collective approach has made it possible to invest larger amounts in promising startups,”Keri explained.
She pointed to Rising Tide’s own journey as an example, stating “In 2018 and 2019, our ticket sizes ranged between $1,000 and $25,000. As the network expanded and more investors pooled resources behind particular deals, ticket sizes increased significantly. Today, across the continent, more angel networks and syndicates or investment clubs are driving this trend, and the ecosystem is maturing as a result.”
Keri emphasised that this evolution has also transformed the way angels connect with founders, noting that what used to be informal such as funding a relative’s venture is now a structured process. Networks like the Lagos Angel Network and Rising Tide often co-invest, sometimes blending equity with debt, depending on the startup’s needs. “It’s no longer just about individual decisions. We’re seeing collaborations where one network identifies a strong opportunity and pulls in others to strengthen the round,” she said.
Technology is also reshaping how angels invest with digital platforms curate deals, enabling investors to review vetted opportunities, conduct due diligence, and commit funds through digital channels. According to Keri, these tools have made angel investing more transparent, efficient, and accessible further fuelling the growth of Africa’s early-stage ecosystem.
Beyond fintech: diverse investment appetites
Although fintech continues to dominate Africa’s startup investment landscape given its rapid growth cycles and quicker returns. Keri pointed out that sector preferences often depend on investor philosophy and expertise.
“For Rising Tide, our focus is closing the gender funding gap,” she said, adding “We are a network of female investors supporting female-led or gender-diverse businesses. That makes us sector agnostic; if a woman-led venture comes along, whether in health, education, or fintech, we look at it.”
Other networks, however, align their capital with areas of subject-matter expertise. “If an investor’s background is agriculture, they’re more likely to back agritech. Edutech attracts those passionate about education. Fintech attracts investors drawn by speed of growth, while health and education usually appeal to impact-driven investors who are patient with returns,” Keri explained.
Beyond financial returns, angel investors in Africa are increasingly guided by the impact their capital can deliver. According to Keri, founders on the continent are driven first and foremost by problem-solving. These challenges ranging from healthcare and education to mobility and financial inclusion—naturally translate into social and environmental outcomes before crystallising into economic gains.
“As a continent, our founders are solving problems. Those problems often fall into social or environmental categories. But when you fast forward, after solving those problems, the economic outcomes follow. For successful ventures, social and economic impact are not mutually exclusive—one leads to the other,” Keri explained.
She cited the example of a Tanzanian health-tech company that began by addressing the simple but critical issue of how medication is dispensed and delivered. What started as a social problem quickly evolved into a thriving enterprise generating $6 million in revenue, underscoring how social innovation can drive sustainable economic value. Similarly, fintech companies that began with the goal of broadening financial inclusion have scaled into multi-million-dollar operations, achieving both impact and profitability.
Africa must fund Africa
Looking ahead, Keri emphasised a theme that has gained momentum across the continent in 2025: “Africa must fund Africa.” The idea, she noted, is not about shutting the door to international investment, but about Africans taking the first bold step in believing in and backing their own innovators.
“If we do not put our own foot forward, the West will not come,” she argued. “Global investors are mostly looking for de-risked opportunities. That means if local capital doesn’t first support African startups, overseas funds will not follow.”
She pointed to unicorns like Flutterwave, Paystack, and MoniePoint as proof. All three were initially fuelled by the high-risk backing of angel investors and local networks before becoming attractive to global venture capital. “We took the first hit. It was only after angels and local investors put money on the table that international players came in,” Keri said.
According to her, this model must be deepened across the continent. “We have more opportunities here than anywhere else, but we must start to mobilise local capital to invest in our founders and address our own pressing challenges. If we keep waiting for global funds, we will have to accept their terms and conditions. But if we lead with our own money, we set the pace and give confidence to the rest of the world.”
This philosophy, she added, underpins upcoming gatherings of angel networks and investment communities across Africa, where the call will be to strengthen homegrown funding mechanisms and reduce dependence on foreign capital.
