According to the latest “2022 AVCA Venture Capital in Africa Report” by the Africa Private Equity and Venture Capital Association, Nigeria emerged as the top African country for venture capital investments.
The report revealed that Nigeria accounted for 22% of venture capital deals, surpassing other countries on the list.
Additionally, West Africa maintained its top spot for the second consecutive year, with Nigeria being the most active country in both the region and the continent.
Of the venture capital deal volume in Africa, West Africa attracted the largest proportion (30%) driven by Nigeria.
Financials sector in Africa assumed the largest share of deal volume (31%) and deal value (42%) in 2022.
The report found that international investors (77%) were more active in Africa’s venture landscape than African investors (23%) during the year.
Venture capital inflows to Africa last year stood at $5.2 billion, accounting for 3% of the total volume and 1.2% of the total value of global venture funding.
When venture debt is included, Africa raised $6.5 billion across 853 deals.
The report also indicated that startups raising their first round of venture financing accounted for only 37% of VC deal volume in 2022.
Additionally, startups with gender-diverse founding teams raised a cumulative total of almost $950 million.
Compared to other regions, Africa’s venture ecosystem remained relatively stable and experienced a funding drop of less than $50 million compared to 2021.
On the other hand, Latin America saw the biggest year-on-year declines in startup funding, followed by Asia.
The funding gap between Africa and Latin America decreased from $14.8 billion in 2021 to $3.1 billion in 2022.
Despite the relatively small volume and value of venture capital in Africa compared to other regions such as North America and Asia, the report highlighted steady growth in recent years and potential for further growth in the future.