Kenya was Africa’s top destination for venture capital in 2025, accounting for nearly a third of all startup funding raised from investors seeking profits from the continent’s next big technology ventures.

 

According to new data from startup funding tracker Africa: The Big Deal, Kenya-based start-ups raised $984 million last year, the highest amount attracted by any African market since the 2022 funding boom. This represented 32 percent of the $3.2 billion raised across the continent.

Startup investment in Kenya grew 52 percent year on year (YoY), up from $638 million in 2024, when the country also took the largest share of Africa’s venture investment. Kenya’s performance was driven largely by large-ticket deals in the energy sector, the report says.

Some of the Kenyan start-ups that reported large investment rounds last year include solar home system maker Sun King, which raised $40 million in an equity financing round to fund expansion across the 46 African markets it operates in. Internet service provider Mawingu secured $20 million, while Leta, a supply-chain and logistics software-as-a-service (SaaS) provider, raised $5 million to scale across Africa and expand into the Middle East.“Funding in the country grew 52 percent YoY overall. Debt ($582 million, up 33 percent YoY) represented 60 percent of the total raised, and the amount of equity raised ($383 million) almost doubled YoY,” the report says. Debt financing involves funds that must be repaid with interest, while equity financing entails selling a stake in a business, giving up a share of future profits and control.

Kenya’s strong overall performance helped Eastern Africa emerge as the leading region for venture funding in 2025, attracting 34 percent of total capital raised on the continent. The region was followed by Western Africa (24 percent), Northern Africa (23 percent) and Southern Africa (19 percent).

Western Africa, however, led in the number of ventures raising at least $100,000, accounting for 29 percent, followed by Eastern Africa (27 percent) and Northern Africa (23 percent). Overall, the ‘Big Four’ markets accounted for 82 percent of all capital raised in 2025, a concentration that has largely remained unchanged since 2019. Eighty-one percent of start-ups that raised $10 million or more in 2025 were headquartered in one of the four countries.

Egypt ranked second in 2025, raising $614 million, or 20 percent of the African total, a 51 percent YoY increase. South Africa followed with $600 million, also up 51 percent YoY. In fourth place, Nigerian ventures raised $343 million, a 17 percent drop from the previous year. Still, Kenya led Africa in the number of ventures raising at least $100,000, with 86 start-ups.

Senegal and Benin were the only other markets to cross the $100 million mark, largely due to single large debt funding rounds. Morocco, Ghana, Tunisia, Rwanda and Uganda recorded between $10 million and $100 million in funding.

Investment in African ventures has been regaining momentum since a slowdown in 2023, attributed to rising inflation, weakening local currencies and unfavourable interest rates, which prompted foreign investors to shift capital away from the continent.

Until late 2022, African start-ups — particularly fintech businesses — enjoyed a funding boom from venture capitalists and angel investors. Analysts expect venture investment to continue in 2026, but with greater scrutiny.

“Capital is available, and we see it increasing,” he told The EastAfrican in an interview, “but where start-ups fail to meet these expectations, fundraising becomes difficult, resulting in closures or restructuring.”Push Venture Capital partner Benjamin Singh said he expects a “flight to quality” this year, with investors deploying capital more selectively towards founders with realistic growth timelines and grounded valuations.

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