Most active investors in Africa - Q1 2021
With the first quarter closed, is 2021 on a good start? It would certainly appear so!
Real time data on venture deal activity in the continent is taken from the findings of Max Cuvellier (GSMA) and Maxime Bayen (BFA Global/Catalyst Fund).
The first quarter of the year has been quite remarkable for Africa's startup ecosystem. Major growth deals so far include TymeBank’s $109M Series B and Flutterwave’s US$170M Series C, but beyond that, dozens of startups have raised rounds of US$1M+ since the beginning of the year. As a matter of fact, the ecosystem has already crossed the half-billion-dollar mark of funding raised through those $1M+ deals in 2021. Back in 2019 and 2020, it had taken twice as long to reach such a milestone.
Overall, the amount raised through disclosed deals US$1M+ in Q1-2021 is 73% higher than in Q1-2020. Further to this, Q1-2021 numbers are higher than Q4-2020, which is extraordinary as the final quarter tends to see a surge in investments as investors rush to close deals before year end.
The most active investors so far
With the increased number of deals so far, it is an interesting exercise to look at the most active players that are betting on these startups. Disclosed deals make up the majority of the numbers covered by Max Cuvellier and Maxime Bayen, with a few inputs of undisclosed deals kindly shared to them for the sake of data collection purposes. Four VCs have done more than ten deals this year so far, namely: Launch Africa, Kepple Africa Ventures, Y Combinator and Flat6Labs. Collectively they have done close to 60 deals.
Two players in particular - Launch Africa & Kepple Africa - seem to lead the pack. With 18 and 17 deals respectively, they are investing at a rate of over a deal a week. They are followed by Y Combinator & Flat6Labs, with 11 and 10 deals respectively. Beyond the volume of deals, at least two points are worth mentioning about them. Firstly, it is very encouraging to see that these most active investors are venturing outside of the “Big Four” (Nigeria, South Africa, Kenya, Egypt) and also signing deals, or taking part in rounds, with startups based in other parts of Africa (including Tunisia, Côte d’Ivoire, Botswana, Senegal or Togo). This is a trend that continues from 2020, where the spread to venture capital was distributed to more geographies than previous years. The second point to note is that these top four investors are active in rounds as low as +/- US$100k (overall round size and not individual investors’ ticket size). The ticket sizes of these rounds is indicative of filling the gap in the funding of early-stage in Africa and therefore a good thing.
Of course, many more other investors have signed deals this year already. Max and Maxime estimate that at least 216 investors have already participated in one deal or more on the continent. According to Partech, 443 unique equity investors were involved in the 359 equity rounds raised by African startups in 2020. With that in mind, 216 investors involved in deals by the end of Q1 means we can expect a lot more activity this year! And there is no doubt some of those who were most active in 2020 (like Goodwell Investments, 500 Startups or Lateral Capital) have a few deals up their sleeves to look forward to.
Learn more by accessing the Africa Startups Deals Database (by Maxime Bayen) here: https://gumroad.com/l/bQSRD/africabigdeal