What African startups returned to investors in a decade
- Flutterwave raised $475 million, accounting for 25.1% of the total capital raised by its cohort.
- 34 companies received 89% of the total funding, while 20 companies raised nothing.
- The median amount raised by companies in the cohort was about $1 million over ten years.
The stark disparity in funding distribution among African startups raises concerns about the sustainability of the venture capital model in the region. The lack of liquidity events and the concentration of capital in a few companies suggest that the current approach may not effectively support the diverse needs of the African market. A reevaluation of funding strategies, including the introduction of revenue-based finance and patient capital, is essential for fostering a more equitable startup ecosystem.
