Venture capital investments in Africa dipped slightly to $6.5 billion last year but avoided the sharp drop seen in most other global regions, data released by an industry group showed on Thursday.
The investments, spread over 853 deals, represent a 1% decline from 2021 – a record year in Africa – according to the African Private Equity and Venture Capital Association (AVCA), which promotes private investment on the continent.
That compares to a 32% contraction in global venture capital.
“When evaluated against any year other than the stratospheric 2021, industry activity in Africa’s venture capital ecosystem was very strong,” AVCA wrote in a report accompanying the data.
Venture capital investments hit a record in the first half of 2022 and would go on to make up two-thirds of deals by value for the year, offsetting an anemic second half.
While African startups still attracted just a small fraction of the $445 billion invested globally, the continent has seen steady growth, propelled largely by investments in financial sector companies.
The sector accounted for 31% of deal volume and 42% of deal value in 2022, the data showed.
Overall, the median deal size across all investment stages was $2 million, though 15 large deals in companies attracted a combined $2.2 billion.
Sun King, a provider of off-grid solar energy products in Africa and Asia, raised $260 million in a series D funding round. Africa-focused fintech firm Flutterwave raised $250 million. And d.light, a Kenya-based off-grid solar company, brought in $238 million in venture debt.
West Africa remained the most active region for venture capital investments, propelled by Nigerian startups.
