The African Private Capital Association (AVCA) has officially released its highly anticipated 2024 Venture Capital in Africa Report, providing a comprehensive analysis of the venture capital landscape across the continent. In 2024, Africa attracted a total of $3.6 billion in venture capital funding, which included $1 billion sourced from venture debt. However, the report highlights that the year was particularly challenging for African startups, as evidenced by a 22% year-over-year (YoY) decline in deal value and a 28% drop in deal volume.
In contrast, while global venture capital value experienced a modest 6% increase, the volume fell by 24%. The sharper contractions observed in Africa indicate that the continent is experiencing a delayed downturn cycle. Notably, venture debt lenders accounted for only 12% of the total deal volume but contributed a significant 37% to the overall VC deal value in 2024. The slight 3% YoY increase in both deal value and volume suggests that there remains a sustained appetite among investors for this asset class.
Geographically, West Africa continued to assert its dominance as the most active region for venture capital, marking its fourth consecutive year in this position. The region accounted for 23% of the total deal volume, with Nigeria leading the charge at 16%. The so-called ‘Big 4’ markets—Nigeria, Egypt, Kenya, and South Africa—collectively represented 55% of the total volume and 64% of the overall value.
In terms of sector performance, fintech remained the frontrunner, with 116 deals raising $1.4 billion, which constituted 34% of all tech-enabled funding rounds. Additionally, clean- and climate-tech saw a notable increase, comprising 13% of tech-enabled deal volume, a significant rise from the 7% average over the past five years. For the first time, artificial intelligence (AI) emerged among the top four most funded sectors, with 42 deals securing $108 million.
A noteworthy trend highlighted in the report is the rise of African investors, who have now become the largest group of active participants in the venture capital space, representing 31% of the total investor pool—up from 19% a decade ago. This shift underscores the growing momentum in domestic capital formation, even as overall investor participation declined by 21% from 2023, resulting in 614 active investors.
The fundraising environment demonstrated remarkable resilience, with eight funds successfully closing at a total of $736 million in 2024 alone. This figure represents a 41% YoY increase, reflecting the long-term growth potential of Africa’s venture capital ecosystem, despite facing global economic headwinds. Since 2015, a total of 35 fund managers across 41 funds have raised $2.7 billion in final closes, showcasing a 25% compound annual growth rate (CAGR).
The exit landscape is also showing signs of vitality, with 138 exits recorded between 2019 and 2024, indicating a clear upward trend over time. However, the number of exits remained flat in 2024, with 26 exits reported. Trade sales continued to dominate the exit strategy, accounting for 84% of all exits, with an average holding period of 3.8 years.
Abi Mustapha-Maduakor, CEO of AVCA, commented on the findings, stating;
The data demonstrates how Africa’s venture ecosystem is responding to global challenges with notable resilience. While overall funding has contracted, we’re seeing strategic adaptations—higher quality deals, sector diversification beyond fintech, increased venture debt utilization, and the strengthening role of African investors. These responses reflect a maturing market that continues to present compelling opportunities. We remain optimistic about the venture landscape in Africa, particularly as it offers investors unique exposure to fast-growing markets with demographic advantages and innovation potential compared to more traditional investment destinations.
For more information and to download the report, please click here.
