In the first half of 2023, Venture Capital investments in African tech startups reduced by nearly 50% compared to the first half of 2022.
Due to the global economic downturn, fundraising has become more challenging for African entrepreneurs. Despite the launch of several venture capital funds in the last six months, investors are still maintaining a tight-fisted approach to investing.
"A retreat of some international funds and major losses for international LPs (that remain a large source of funds for African VCs than domestic LPs) has indeed affected sentiment around investing—with several VCs delaying final close on new funds and slowing down their investments towards the end of 2022 and the start of 2023," Mark Kleyner, co-founder of Dream VC told Bendada.com.
In the first half of 2023, African tech startups raised only about $1.3 billion ($1,307,811,193) across 148 deals, according to BD Funding Tracker. This is a 47.69% decline from the funds [$2.5 billion] that were raised within the same period on the continent last year.