No Growth in African Tech Funding as Q1 2025 Sees $284M Investment Across 55 Startups

The first quarter(Q1) of the year didn’t show significant growth which has dampened hopes for a rebound in African tech funding in 2025. As per the reports, in African Tech Funding, a total of $284 million was raised across 55 startups. The amount of money given to tech businesses in Africa during the first quarter of 2025 has reduced compared to the same time last year.

This means that the amount of money given to tech businesses in Africa in 2025 might not grow or will remain the same as 2024. This sharp decline was because lacking capital in the world which now shows grave consequences to undertaking ventures all over Africa. Unfortunately, things didn’t get better after late last year seeing as big rounds for the likes of Moniepoint and Yellow Card were seen, only for 2025’s Q1s to show things are still not on the up.

Startups raised 284 million dollars this quarter, which is 8.4% lower than 310 million dollars in Q1 2024. Moreover, there were just 55 funded startups compared to 82 in Q1 2024, amounting to a decline of almost 49%. Further decline in African Tech Funding Q1 2025 is disheartening but the bright spots indicate that not everything is a lost cause.

Despite low global funding, the number of startups receiving at least $1 million funding per quarter remains constant. Fifty-two such deals took place, similar to the average of recent years. The disappointing totals can be attributed to the absence of large-sized investments exceeding $10 million.

Also, the distribution of funding shows some patterns. In the first quarter of 2025, 83% of African tech funding favored startups in Kenya, Nigeria, South Africa and Egypt, popularly referred to as the Big Four. These countries have sat comfortably atop the continent’s biggest tech ecosystem, leaving everyone else to scramble for the scraps.

Furthermore, March 2025 saw one of the lowest monthly totals recorded since late 2020, with just $50m raised. After a strong January with almost $300 million, the total dropped steeply to $119 million in February. The biggest winners of African Tech Funding Q1 2025 were Nigeria’s LemFi, South Africa’s Naked, and Togo’s Gozem, which secured some of the largest rounds this quarter. They were among the largest rounds this quarter.

The document cites that “One positive development did stand out at the start of 2025: growth capital rounds are no longer limited to South African companies. Even though we see improvement, as seen by the continued number of smaller deals and big wins by top startups, investments are low overall. The uncertain global economic situation means that African tech startups likely have to adjust to difficult funding conditions for the time being.

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