New forecast shows Africa’s startup investment inflows could reach highest record of $5bn in 2021
So far in 2021, African startups have recorded total foreign investment inflows of about $4.8 billion. And before the year ends, the figure could potentially hit $5 billion, according to Dario Giuliani, the director of London-based research firm Briter Bridges Intelligence.
Bloomberg reported that the huge investment inflows were made possible due to foreign investors’ keen interest in Africa’s vibrant financial technology (fintech) scene. Interestingly, said foreign investment inflows have led to the rise of companies such as Flutterwave and Opay who now have valuations of over $1 billion each.
Commenting on the situation, Standard Bank‘s global head of telecoms and media, Nina Triantis, said the growing inflows are specifically being driven by investors in the United States of America, China as well as some institutional bankers.
As you may well know, African fintechs have been striving to bridge the continent’s financial inclusion gap. They do this by leveraging the continent’s increasing internet penetration and proliferation mobile telephones to provide innovative financial solutions.
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Besides the fintechs, other innovative tech startups across sectors have come up with innovative tech solutions aimed at enabling education, agriculture. In return, they have continued to attract the attention of foreign venture capitalists.
Earlier this year, AfricArena and other analysts predicted that startup investments in Africa would surpass last year’s record to reach between $2.25 and $2.8 billion. Now, as you may well know, the COVID-19 pandemic had disrupted investment inflows in 2020.
And considering the fact that the adverse effects of the pandemic still lingered, there were some doubts whether this year’s inflows could actually surpass that of last year. And then much to everyone’s surprise, it has actually doubled the $1.43 billion raised in 2020.
So, it has been a really good year for African startups. And there are indicators that 2022 will even be better.
