40% of funded startups are under five years old — Report

Over 40 percent of tech startups funded in 2024 were launched within the last four years, highlighting a significant influx of new ventures into the market, a new report disclosed.

According to the African Tech Startups Funding Report 2024 by Disrupt Africa, the dominance of seed, pre-seed, and pre-Series A funding rounds reflects the youthfulness of the continent’s tech startups.

“It is unsurprising that the majority of the African tech startups that raised funding in 2024 are quite young, with 87–43.5 percent of the total – founded in the last four years.

“The predominance of early-stage funding rounds continued in 2024. Of the 84 disclosed funding rounds, 75 percent were at the pre-Series A stage or earlier, including seed and pre-seed rounds,” the report stated.

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This marked a slight decrease from 78.4 percent in 2023 and 79.7 percent in 2022, indicating a continued focus on nascent startups despite the downturn. Meanwhile, Series A rounds accounted for nearly 18 percent of the disclosed deals, while Series B and Series C made up approximately five percent and 2.5 percent, respectively.

The report disclosed that African tech startup funding plummeted in 2024 as the funding winter took its toll on the sector. It said, “A total of 200 startups raised $1,11 billion over the year. This was fewer startups than as long ago as 2018, and less investment than in 2021, though significantly more than in 2020.

“The number of funded ventures was down 103 percent on the 406 that were raised in 2023. This is the second year in a row we have witnessed a decline in this regard, having reported increases in every year since tracking began in 2015,” Disrupt Africa added.

Similarly, according to Africa: The Big Deal, startups in Africa raised $2.2 billion in 2024, a 25 percent decline compared to $2.9 billion in 2023.

However, this year African startups have raised $408 million between January and February, the highest amount since 2021, when they raised $400 million. According to Africa: The Big Deal, which tracks funding of $100,000 and above, despite raising $119 million in February, these startups are still on track to have a great year.