African startups raise $289 million in January, marking a strong start for 2025
African startups kicked off 2025 with a remarkable fundraising performance, securing a total of $289 million in January through several deals worth $100,000 and above.
This figure represents a staggering 240% increase compared to the $85 million raised in January 2024, making it the second-best January for startup funding since at least 2019, trailing only behind January 2022 during the peak of the funding boom.
The latest data from Africa: The Big Deal reveals that equity financing dominated the fundraising landscape, accounting for over 90% of the total amount raised ($262 million).
This is a significant jump from January 2024 and also marks the second-highest January for equity fundraising in the past six years.
Big Four dominate funding landscape
The four largest deals in January 2025 alone accounted for nearly 60% of the total funding raised across the continent.
Notably, all four deals originated from one of Africa’s “Big Four” startup ecosystems — Nigeria, Kenya, Egypt, and South Africa.
However, three of these deals highlighted a growing trend of African startups expanding their operations beyond the continent.
The top deals of the month include:
- PowerGen (Energy): The renewable energy company raised over $50 million to establish a scalable platform for distributed renewable energy solutions across Africa. This funding underscores the increasing investor appetite for sustainable energy solutions on the continent.
- LemFi (Fintech): The fintech startup secured $53 million to further its expansion into Asia and Europe. LemFi’s success reflects the global appeal of African fintech innovations, particularly in the remittance and cross-border payment space.
- Naked (Insurtech): South Africa-based Naked raised $38 million in a Series B round to automate and expand its product offerings. The insurtech sector continues to gain traction as startups leverage technology to disrupt traditional insurance models.
- Enko Education: The education-focused startup secured $24 million to continue expanding its network of African schools. This investment highlights the growing interest in addressing Africa’s education gap through innovative solutions.
A promising start to 2025
The strong fundraising performance in January 2025 signals a renewed confidence in Africa’s startup ecosystem, which faced significant funding challenges in 2023 and 2024.
- The diversification of sectors attracting investment — from energy and fintech to insurtech and education — also reflects the continent’s evolving economic landscape.
- In 2024, African startups cumulatively raised a total of $2.2 billion driven by two mega deals by Nigeria’s Moniepoint and South Africa’s Tyme Group.
- The amount included equity, debt, and grants secured by the continent’s startups.
While the amount raised in 2024 was quite significant, it represents a 25% drop in funding compared to the $2.9 billion raised on the continent in 2023.
