« Over the past year, I collected 200+ valuations from early-stage start-ups that secured venture capital funding from 2019 to 2022. According to my research, where a start-up is primarily located could have an impact on its valuation. One of the interesting observations was the difference in valuations between start-ups based in Nigeria, Egypt, Kenya, and South Africa (the ‘Big Four’) and start-ups based in other African countries.

Like we had done a few weeks ago for Q1, as soon as the numbers were out, we had to go back and compare the performance of Africa to other regions’ for Q2. And the situation is quite dramatic. If we look at YoY evolution of quarterly funding* (i.e. comparing Q2 ‘22 to Q2 ‘21), Africa is simply the only region that continued growing YoY.

Following our coverage of Eastern, Northern and Western Africa - and after a quick break to celebrate H1 results ($3bn+ 🥳) - we’re off to Southern Africa this week. Southern Africa represents 17% of all the funding raised by start-ups in Africa since 2019, which puts it in third position behind its Western and Eastern cousins.

Start-ups in Africa have raised more than $3 billion in the first half of 2022 and recorded their strongest June, Q2 and H1 ever.

By popular demand, and after covering Eastern and Northern Africa, we’re now headed to Western Africa. With a total of $4.2bn (41% of the total), Western Africa is by far the region that has attracted the most funding since 2019. Start-ups in the region have attracted more funding than in Northern and Eastern Africa combined during the period.

We thought we'd take a look at another region this week after receiving such excellent reaction on our Eastern Africa piece - and while we wait for the Q2 data - And, given that Maxime was in Cairo last week, it's Northern Africa! Since 2019, about $1.5 billion has been invested in Northern African start-ups, accounting for 15% of the total invested across the continent.

With over $2.3 billion in capital, Eastern Africa accounts for slightly under a quarter of all start-up funding raised in Africa since 2019. After a minor fall in 2021 (-12 percent YoY), it is off to a good start in 2022: start-ups in the region have already raised about $850 million (as of May 31st), which is already more (by 50%) than they raised in the entire year of 2021.

In recent posts we have covered the ecosystem’s accelerating growth (e.g. here or here), and last week, we put this growth into perspective, comparing it to other regions globally. As we analyzed the numbers, we were struck by how strong the ecosystem’s performance is this year, month in, month out. As a matter of fact, a new monthly record has been set every single month so far in 2022.

According to Africa: The Big Deal, 3 year-on-year growth is a thing of the past... with the exception of Africa. Despite the fact that Q1 2022 was a difficult quarter internationally, investments in start-ups in Africa increased by +150 percent year over year, marking the fourth consecutive quarter of 3-digit growth.

Looking at funding raised from a calendar year point of view (between Jan and Dec) is both convenient and intuitive… but it feels a bit unfair sometimes, in particular because the deals announced at the beginning of the year were often closed at the end of the previous year.

#5 - “🧨 1 billion USD in 7 (yes, seven!) weeks”, #4 - “🖋️ Who are the investors signing all these deals?!“ ...

It is a known fact that the ‘Big Four’ are attracting most of the investment, of the attention - and of the talent - on the continent: start-ups in Nigeria, Kenya, South Africa and Egypt have raised 83% of all the funding and signed 78% of all $1m+ deals since 2019.

Until the last week of the month, with around $140m raised, April was going to be a relatively quiet month, compared to the first quarter of the year (~$480m in Jan, ~$630m in Feb, and ~$710m in March). But with Sun King’s $260m Series D in particular, the ecosystem ended up raising a total of ~$430m in April*.

There has been some debate recently about the Y Combinator model, but this is not what this post about :) What we’ve done though is look at the start-ups in YC’s public directory, and then crossed the data with our deals database.

Doesn’t April feel a little quieter on the deal front? Not quiet, but quieter? Some worry it might be early signs of a slowdown, like the one that’s felt in other parts of the world. Maybe. Though it’s worth noting April is always a quiet month, in terms of total funding raised announced: it was the quietest month in 2019, the quietest month again in 2020, and the second quietest month in 2021.