African tech startups raised $4.1 billion in 2025, posting a strong rebound that underscores the sector’s resilience despite tighter global financial conditions.
According to the latest Partech Africa report, funding rose 25% year-on-year, even as venture capital globally became more selective. The gains, however, were unevenly distributed, with capital increasingly concentrated in a handful of mature markets and later-stage companies.
The so-called Big Four – Kenya, South Africa, Egypt, and Nigeria – captured 72% of total financing. Kenya led with $1.04 billion, a 72% surge driven largely by debt financing and a cluster of mega-deals. South Africa followed with $715 million, up 41%, reflecting what Partech described as “unprecedented market depth across all stages”.
Egypt raised $604 million, while Nigeria attracted $572 million. Nigeria was the only top-four market to record a slight decline in total funding, although deal activity remained strong.
Beyond the dominant hubs, francophone African markets showed notable momentum, accounting for 68% of equity funding outside the Big Four — a sign of widening geographic diversification, albeit from a smaller base.
Debt rises, seed capital retreats.
The report also flags a structural shift reshaping Africa’s startup ecosystem: the rise of debt and the retreat of early-stage equity.
“For the first time, debt has emerged as a key driver of funding for African start-ups, with $1.64 billion raised (+63%), surpassing all previous historical highs. It now represents 41% of total deployed capital,” said Marc-André Loko, Director General of Benin’s Information Systems and Digital Agency (ASIN).
At the same time, seed funding fell for a third consecutive year, declining 4% in volume as investors increasingly favoured more established firms. Average Series A and B ticket sizes grew, largely at the expense of new entrants.
“The scary part of the report is the fact that investors are moving away from early-stage companies. It is a concerning trend,” Loko said. “Of course, start-ups are early-stage enterprises, and if they don’t get funding, they would never become mature companies that investors are craving for.”
Loko warned the pattern could persist. “This is the third year in a row of erosion of the seed segment. We will likely see a similar trend in 2026,” he told Allen Dreyfus, adding that many African start-ups “die even before they launch” due to funding constraints.
Still, he struck a cautiously optimistic note. “The overall report is a positive development for the sector. A 25% year-on-year growth is massive, but we need the top recipients to be enlarged to say, seven or eight countries by the end of this year, and not just the traditional Big Four,” he said.
Partech said the data point to a more autonomous and professionalised African tech ecosystem, where sector diversification and debt financing are helping offset tougher equity conditions — even as access for first-time founders narrows.
