African venture funding rebounded in 2025, but the recovery masked a market increasingly shaped by a narrow set of large transactions rather than broad‑based expansion.
Total capital raised rose to $3.2 billion, up from $2.2 billion in 2024, yet the number of companies securing more than $100,000 remained largely unchanged.
Latest data from Africa The Big Deal, a research initiative that tracks start‑up investment across the continent, shows that while headline figures improved, the underlying structure of the market continued to consolidate around a small group of capital‑intensive companies.
Fintech retained its position as the continent’s largest sector, attracting $1.2 billion across 124 companies. But the breadth of activity continued to narrow. The top five fintech recipients — M‑Kopa, Wave, MNT‑Halan, Moniepoint and ValU — accounted for 52 per cent of all capital raised in the sector, down from 58 per cent in 2024 but still indicative of a market dominated by repeat mega‑raisers.
Debt played a growing role, with Wave’s $137 million facility and MNT‑Halan’s bond issuance helping lift the sector’s total despite fewer funded companies. Fintech also led on liquidity, contributing 19 of the year’s 49 exits, more than double the 22 recorded across all sectors in 2024.
The most dramatic shift occurred in energy, where funding nearly doubled to $857 million, returning to levels last seen in 2023. The sector has become structurally dependent on large debt packages: 71 per cent of all capital raised came through debt, with d.light’s $300 million facility and Sun King’s $156 million raise accounting for much of the total.
The top five companies absorbed 82 per cent of all energy funding, underscoring the extent of concentration. Analysts say the pattern reflects both investor caution and the capital‑intensive nature of distributed energy models.
Outside these two dominant sectors, activity was more diffuse. Logistics and transport raised $309 million across 63 companies, almost entirely through equity. Healthcare attracted $211 million, though nearly half of that came from a single $100 million round for LXE Hearing. Agriculture and food remained modest in capital terms at $122 million but continued to show broad participation, with 62 companies securing funding.
Climate tech — which cuts across energy, agriculture, logistics and other verticals — has emerged as one of the continent’s most resilient themes. Companies in the category raised $1.2 billion in 2025, representing 38 per cent of total funding, in line with 2023 levels and up from 34 per cent in 2024.
Participation has risen steadily, with climate‑linked ventures accounting for 29 per cent of all funded companies, compared with 18–20 per cent just three years earlier.
The data suggests a market bifurcating between a small cohort of capital‑intensive platforms able to secure large debt and equity rounds, and a broader base of early‑stage companies raising modest sums. While the headline rebound in 2025 signals renewed investor appetite, the underlying concentration raises questions about the depth and resilience of Africa’s venture ecosystem as it enters 2026.
Second Eye Africa
