Kenya tops Africa in venture capital funding as Nigeria loses dominance

Joy Agwunobi

Nigeria has lost its long-held position as Africa’s top destination for venture capital funding, with Kenya now leading in startup investments. Despite this shift, Nigeria remains the most funded startup ecosystem in the continent’s history, having attracted N4.6 billion in venture capital over the past five years.

According to a recent  report by Africa: The Big Deal, Kenya emerged as the top recipient of venture funding in 2024, securing $638 million, which accounts for 29 per cent  of the total $2.2 billion raised across the continent. The East African nation has consistently outpaced Nigeria over the last two years, reflecting a broader shift in investor interest.

“There is no denying the weight of Nigeria and the broader region in the African ecosystem overall, though things have shifted since the end of the funding heatwave in mid-2022. During the heatwave and the period leading to it (2020 to mid-2022), West Africa attracted 41 per cent  of the continent’s startup funding—almost double the share of the second-most attractive region, East Africa, at 22 per cent . Since mid-2022, however, this share has dropped to 25 per cent , with East Africa (30%) claiming the top spot,” the report stated.

Despite losing its leading position, Nigeria’s historical dominance is reflected in the overall performance of West Africa. The firm revealed that since 2019, the region has secured $5.8 billion in venture funding, accounting for 36 per cent  of the total $16.2 billion raised across the continent. However, this regional strength appears to be waning. In 2024, West African startups raised $587 million—27 per cent  of Africa’s total falling behind East Africa’s $725 million, which represents 33 per cent  of the continent’s funding.

Unlike some regions where a single country dominates venture investments, West Africa’s funding landscape has become more evenly distributed. While Nigeria remains the top destination, other countries in the region are gaining traction. The report highlights that Ghana ($460 million) and Senegal ($410 million) are approaching the half-billion-dollar mark in total funding since 2019. Benin ($133 million) and Côte d’Ivoire ($107 million) complete the region’s top five, while the rest of West Africa collectively attracted just 1 per cent  of the regional total.

Nigeria’s enduring influence in Africa’s startup ecosystem is further underscored by its status as the continent’s hub for unicorns – startups valued at $1 billion plus. The report notes that Nigeria is home to five unicorns, the most on the continent. These include Opay, Flutterwave, Interswitch, PalmPay, and Moniepoint. Additionally, Nigerian fintech startups continue to dominate, with seven of the region’s top-funded startups belonging to this sector.

The report also recognised the rise of Senegal’s Wave Mobile Money, which has raised nearly $300 million, and Benin’s Spiro, which has attracted over $100 million. These startups have been instrumental in boosting their home countries’ venture funding performances, contributing 71 per cent and 85 per cent of their nations’ total funding, respectively.