What does the future hold for African tech investment?

The African tech ecosystem is one of the fastest developing in the world. We hear from founders of African descent about the shape of the tech scene and how investment is shaping startups on the continent.

“The next wave of global prosperity is going to come from Africa.”

A bold claim from Dickson Nsofor, co-founder and CEO of digital payment engine Korapay. And yet, having seen first-hand what an African startup can do with the right funding and traction, Dickson can back it up.

Since its founding in 2017, Korapay has recorded US$1.5 billion in transactions across the two African countries it operates in. And Korapay is by no means a one-off success.

Africa: A power on the rise?

Dickson noted that, in 2021, African startups created 30,000+ jobs and had a combined value of US$50 billion. This is supported by African Private Equity and VC Association (AVCA) with data showing that 2021 was a record year for Africa’s emerging companies:

• More than US$5 billion raised from 604 companies across the African continent.
• VCs invested more in African companies in 2021 than the prior seven years combined.
• Roughly 81 percent of VC deals were in tech development or tech-enabled companies.

A growing school of thought among African business leaders is ’Africapitalism’, a philosophy emphasising the private sector’s role in advancing continental economies.

Dickson touched on Africapitalism, saying: “When market-creating innovators in Africa have equal opportunities and resources [to those in other countries], they can create new markets and jobs.”

He also claimed Africa – as a business market – has an economic potential of US$1 trillion.

The core features of African startups

One of the defining traits of African founders is energy. According to Dickson, “Africa has one of the most vibrant, young populations in the world”. Youthful perspectives and a lack of cynicism, Dickson elaborated, are helping African companies develop transformative ideas.

Resourcefulness is another critical feature of African-run companies. Calendly founder and CEO Tope Awotona made that clear when exploring how early years living in Nigeria were influential: “Lagos was a place of political and economic instability, and the way the Nigerian people responded to that is with resourcefulness. If you look at Calendly, resourcefulness has been a theme running through our development.”

Perhaps Africa as the site of the “the next wave of global prosperity” isn’t a bold claim at all.

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Main image of African continent seen from space: Anton Balazh/Shutterstock