Kenyan startups raised close to US$1 billion in funding in 2025, the largest amount raised by any African market since 2022, driven overwhelmingly by debt financing into energy and asset-heavy companies – according to new data from ‘Africa: The Big Deal’.
- •Funding in Kenya rose 52% year over year, accounting for almost one-third of the total funding raised by startups across Africa last year.
- •About 60% of the capital came as debt, reflecting large financings for solar and energy-access firms including d.light, Sun King, M-Kopa, Burn, and PowerGen.
- •On the other hand, the number of Kenyan ventures raising at least US$100,000 fell 23%, the steepest decline among Africa’s four largest startup markets.
Energy and fintech dominated the largest funding rounds in 2025, accounting for most deals above US$100 million. The pattern reflected growing investor preference for businesses with predictable cash flows and asset-backed models, blurring the line between venture capital, infrastructure finance and development funding.
Across the continent, startups raised US$3.2 billion in 2025, a 40% increase from 2024 and the first annual rise after two consecutive years of contraction. While the recovery lifted fundraising above 2023 and 2024 levels, it remained below the highs reached in 2022.
Investment remained heavily concentrated in Africa’s four dominant markets, with Kenya, Egypt, Nigeria and South Africa attracting 82% of all startup funding, a proportion that has remained largely unchanged since 2019.
The concentration intensified at the upper end of the market, with more than 80% of rounds above US$10 million raised by companies headquartered in those four countries, while smaller deals were more evenly distributed across the continent.
Egypt followed closely with US$614 million raised, also up 51% from 2024, split roughly evenly between equity and debt. The country emerged as the second-largest destination for debt financing on the continent and maintained steady deal activity, with 61 ventures raising at least $100,000 during the year.
South Africa ranked third by total funding with US$600 million raised, growing 51% year over year. Unlike Kenya, the market was overwhelmingly equity-driven, with more than 90% of capital raised through equity rounds.
South Africa also recorded a sharp rise in deal activity, with 83 ventures raising at least US$100,000, up 63% from the previous year, reinforcing its position as Africa’s largest equity-focused startup market.
Nigeria underperformed its peers, raising US$343 million in 2025, down 17% from the previous year. Its share of total African startup funding fell to 11%, the lowest level recorded since 2019. Equity investment, which accounted for more than four-fifths of funding in the country, declined 22% year over year.
Despite the drop in capital, Nigeria remained the continent’s most active market by deal count, with 86 ventures raising at least US$100,000, highlighting a shift toward smaller rounds and reduced investor risk appetite.
Outside the four largest markets, only two countries recorded more than US$100 million in startup funding. Senegal rose to fifth place with US$157 million, largely due to a single large debt round by fintech Wave, while Benin ranked sixth after Spiro raised US$100 million.
A broader group of countries including Ghana, Morocco, Tunisia, Rwanda and Uganda; each attracted between US$10 million and US$100 million, though 26 African countries recorded no identifiable startup deal above US$100,000.
Regionally, Eastern Africa led the continent in funding volume, capturing 34% of capital raised, followed by Western Africa at 24%, Northern Africa at 23% and Southern Africa at 19%. Western Africa, which dominated startup funding earlier in the decade, slipped from its 2024 share as Nigeria’s decline offset gains elsewhere in the region.
Over the longer term, African startups have raised nearly US$20 billion since 2019, with just 33 companies surpassing US$100 million in cumulative funding. The 2025 recovery underscored how capital is increasingly flowing to a narrow group of scaled companies and mature markets.
