Private capital investment in Africa in first half (H1) 2022 received a total deal volume of 338 deals with a cumulative deal value of $4.7 billion.
Three main factors contributed to strong deal activity and they include; the substantial amount of fresh capital raised by fund managers in 2021 as investors made deployments across various strategies and sectors, an increasing interest in Africa’s venture ecosystem which has not only attracted international investors and supported the development of domestic venture capital firms but has also encouraged pan-African private equity firms to broaden their strategy to include a dedicated focus on venture capital, and overall larger ticket sizes.
In 2022 H1, Africa’s Venture Capital (VC) ecosystem remained bullish despite inflation and an unfavourable macroeconomic environment.
In a record-breaking start to the year, the cumulative value of VC deals reported in Africa reached $3.5 billion, raised by 300 unique companies.
This equates to a 133 per cent year-on-year increase from 2021 H1. The 2022 H1Â African Private Equity and Venture Capital Association(AVCA) report predicts that the total value of VC deals will reach $7 billion by the close of 2022, a 35 per cent year-on-year (YoY) increase from the $5.2 billion raised in 2021 if this pattern continues.
Africa is the only market to register more than single-digit growth for the period. This growth in startup funding, unlike global trends this year, demonstrates the depth of opportunity, the continent’s growth potential, and increased supportive action from governments to enable entrepreneurship in areas that were previously underserved.
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