African technology start-ups raised at least US$129m (R1,7bn) in funding in 2016, with the number of companies securing funding rising by almost 17% over the previous year, according to new research.
Disrupt Africa’s Tech Start-ups Funding Report, released on Wednesday, shows that 146 start-ups across the continent raised the cumulative $129m during the course of last year.
“This displays substantial growth in the number of start-ups to raise funding as compared to the previous year, although the overall total amount of funding recorded declined,” Disrupt Africa said.
South Africa, Nigeria and Kenya remained the three most popular investment destinations on the continent, accounting for 80,3% of funds secured, the researchers found.
Egypt experienced growth of more than 100% in fundraising, putting it in fourth place, Disrupt Africa said.
Of nine sectors analysed in the report, the financial technology space received the most backing in 2016. Fintech start-ups raised $31,4m.
“The general theme of 2016 has been more rounds, but with fewer standout tickets than in 2015,” said Disrupt Africa co-founder Tom Jackson.
“The African tech space has not been immune to the economic pressures faced by other sectors, but it is proving extremely resilient. The fact that more start-ups raised funding in 2016 … demonstrates the vitality of this sector, and we expect investor interest to grow over the course of 2017.” — © 2017 NewsCentral Media
