Is there a bubble emerging in Africa’s tech start-up scene?

In depth
This article is part of the dossier: Digital Africa

By Kanika Saigal
Posted on Tuesday, 12 July 2022 08:29, updated on Friday, 29 July 2022 18:17

Other startups operating in various fields have followed suit with Nigeria's Flutterwave, which raised $170m in March 2021. photo/Flutterwave

The number of deals closed by Africa’s tech start-up scene mushroomed in 2021 to 681. In total, the deals, closed by 640 start-ups, brought in around $5.2bn – nearly three times the amount raised in the previous year. Will the tech bubble keep growing or is it bound to burst?

Of the deals, 14 of them were ‘mega deals’ of over $100m, comprising 48% of the total value raised.

Funding rounds were closing in record time for sums never seen on the continent before. “I heard that some deals were getting done in a number of days,” says Adesoji Solanke, director, frontier banks and fintech at Renaissance Capital. “Many of them were oversubscribed.”

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