Kenya emerged as the top destination for startup funding in Africa, surpassing Nigeria in 2023, according to a report by ‘Africa: The Big Deal,’ a tech research firm. The year marked a rebalancing of investments across major tech markets on the continent, including Egypt, Nigeria, Kenya, and South Africa.
Kenyan startups managed to raise just under $800 million, claiming 28% of the continent’s total funding. Despite a 25% year-on-year decline, Kenya’s share of Eastern Africa’s funding increased from 86% in 2022 to 91% in 2023. The report also highlighted that 93 Kenyan startups secured $100,000 or more during the period, constituting 19% of Africa’s total.
Kenya’s President, William Ruto, attributed this success to the country’s strategic reforms that have improved the business environment. He expressed pride in Kenya leading Africa in startup capital and securing an impressive $800 million (Ksh 124 billion) in 2023.
Ruto stated on Twitter, “Our strategic reforms have enhanced the business environment, positioning Kenya as the preferred choice for investors. This achievement reflects our commitment to fostering innovation and economic growth. The substantial funding is driving groundbreaking ideas, fueling technological advancements, and propelling job creation.”
In contrast, Nigerian startups experienced a significant drop in funding in 2023, with a year-on-year decline of 65.83%. Funding fell to $410 million from $1.2 billion in 2022. Although Nigeria still claimed the highest number of startups raising $100,000 or more, the amount raised saw a dramatic reduction, reaching $410 million compared to $1.2 billion in 2022 and $1.7 billion in 2021, as outlined in the report.
