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January 17, 2022
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Fintech Firms Received 62% of the $4.9 Billion Raised by African Tech Companies in 2021 – Fintech Bitcoin News

Fintechs account for practically two-thirds of the $4.9 billion that was raised by African expertise corporations throughout the previous 12 months. Fintech teams additionally dominate in phrases of funding that exceeds $50 million, with a 40% share of the complete quantity of tech corporations.

The Covid-19 Factor

Out of the $4.9 billion in funding that was raised by African expertise corporations in 2021, virtually two-thirds of this went to fintech corporations, knowledge from a brand new report has proven. In phrases of offers whereby the capital raised exceeded $40 million, fintechs accounted for 40% of such offers.

Report: Fintech Firms Received 62% of the $4.9 Billion Raised by African Tech Companies in 2021
Source: Africa Investment Report 2021.

As proven in the latest Africa Investment Report, the fintech dominance in 2021 finally culminated right into a interval with “the highest number of single, non-M&A [mergers and acquisitions] deals above $100 million” on document to this point. The report additionally exhibits that Nigeria has the greatest share of fintech corporations that raised greater than $100 million.

Meanwhile, the report advised that the Covid-19 pandemic might properly be the most important clarification for the surge not solely in the funding of fintechs, however non-fintech corporations as properly.

“Logistics and energy follow by volume of funding but the most recent wave of digitization — perhaps boosted by Covid-19 — is propelling sectors such as e-commerce, agriculture and healthcare,” concluded the examine report.

Funding Highly Concentrated

However, the identical report does concede that almost all of the funds raised in 2021 had been concentrated in a couple of tasks. The report explains:

Although extremely concentrated in a couple of instances, [which] solely represents lower than 3% of complete disclosed offers however captures over 55% of complete disclosed funding, this funding dimension carries vital weight and acts as a pull issue for a number of traders.

Besides fairness financing, the Africa Investment Report knowledge exhibits that debt financing is more and more turning into a viable funding route. To help this assertion, the report factors to the indisputable fact that 6% of complete disclosed funding in 2021 was debt financing.

Report: Fintech Firms Received 62% of the $4.9 Billion Raised by African Tech Companies in 2021
Source: Africa Investment Report 2021.

In phrases of the origins of the late-stage traders, the knowledge exhibits that the United States is by far the greatest supply of capital for Africa tech corporations with a 62.5% share. In a distant second place was the United Kingdom, which had a share of 7.5%, adopted by South Africa 6%, and Canada which accounts for 4%.

What are your ideas on this story? Tell us what you assume in the feedback part under.

Terence Zimwara

Terence Zimwara is a Zimbabwe award-winning journalist, writer and author. He has written extensively about the financial troubles of some African nations in addition to how digital currencies can present Africans with an escape route.














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