2019 Venture Funding In Africa: A Tale Of China Rising?

    Deals
    Venture Capital

It's the start of a new decade and we are taking a look back at the memorable deals of 2019. 2019, in total, raked in $1.694B venture capital across 467 deals per Digest Africa data. Out of this total, over 70 startups raised to the tune of $1M+ ($832.38 in total) and 29 startups of this count have raised $5M+ ($677.6M.) There has been a 55% increase in total, compared to $1.094B raised in 2018. We also do note a new trend in investor participation on the continent during the year. Chinese investment greatly increased, especially in some of the large deals seen this year. PalmPay, OPay and Lori Systems being recipients, collectively raised $248.7M from different Chinese investors including Hillhouse Capital, Crystal Stream, Transsion, NetEase, Meituan-Dianping, Gaorong Capital, Source Code Capital, Redpoint Ventures China among others.    

Financial services emerged as the most funded industry of the $1M+ deals securing 19.6% ($332.7M) of the total from 24 deals. This was followed by the Transport and Logistics sector with 7.5% ($127.37M from 10 deals), Commercial and Professional Services with 6.3% ($108.1M from 4 deals) and Energy and Resources with 6.2% ($106.07 from 7 deals.) E-commerce, Other Technologies and Information Technology, HealthCare and Pharma, Media & Entertainment, EdTech, Recruitment services, Emerging Tech, AgriTech and Real Estate sectors raised $54.25M, $25.24M, $22.54M, $20M, $6.5M, $5.065, $3.5M, $2.8M and $1.5M respectively. Startups Gokada, Chipper Cash, OPay, Lori Systems and Sweepsouth all raised twice within the year. 

Highlighted below are 12 startups that have secured the most funding ($20M+) throughout the year from various sectors. Here are key takeaways: 

  • The featured startups have raised a total of $420.45M (25% of the annual amount raised) across 14 rounds with OPay and Andela in the lead with $170M and $100M respectively.
  • Out of the 14 rounds, 7 were Series A valued at $197.45M, 2 Series B rounds valued at $140M, 2 Series C rounds valued at $63M, 2 Series D rounds valued at $150M and a Seed round valued at $40M. 
  • 4 of the 12 startups are from the Fintech industry (OPay, CarePay, PalmPay and Migo which was formerly Mines,) 3 belong to E-Logistics (Kobo360, Lori Systems and Swvl), 2 to the E-commerce sector (Twiga Foods and Jiji), 1 from Commercial and Professional Services (Andela), Energy and Resources (BBOXX) and Media and Entertainment (Boomplay Music.)
  • Boomplay Music, CarePay, OPay and PalmPay had not raised prior to 2019.

OPay ($170M) 

Opera’s African fintech OPay raised twice last year in a Series A ($50M) and Series B ($120M) with Meituan-Dianping, Gaorong Capital, GSR Ventures, Source Code Capital among others as its notable investors. A majority of these investors are from China that have also registered increased activity, with all participating in both funding rounds of OPay in the year. This brings the Nigerian based startup’s total funding to $170M across 2 rounds. The funds raised will be used to expand their product to Kenya, Ghana and South Africa.

Andela ($100M)

Andela has raised a total of $181M  across 5 rounds, the latest being a Series D of $100M led by Generation Investment  Management (co-founded by former US president Al Gore) with participation from existing investors Chan Zuckerberg Initiative, Google Ventures, Spark Capital and CRE Venture Capital. A few days into January 2020, Andela launched a software engineering training in Kigali targeting aspiring and entry-level engineers in Rwanda to provide them with the necessary technical and soft skills to become a FullStack JavaScript Engineer.

BBOXX ($50M)

This Energy and Resources startup closed a Series D mid of last year to the tune of $50M. This round was led by Mitsubishi Cooperation with participation from Bamboo Capital Partners, Doen Participaties, MacKinnon-Bennett and ENGIE. This brings their total funding raised to $75M across 4 rounds. BBOXX operates in over 8  African countries including Nigeria, Mali, Rwanda, Kenya and Togo. 

CarePay ($45M)

Nairobi-based CarePay is one of Fintech’s most funded in Africa and Kenya, scoring total venture capital of $45M in a Series A round in a bid to roll out its platform into international markets. Later in the year the startup also appointed Moses Kuria as Managing Director and Torooti Mwirigi as Commercial Director. PharmAccess Group and ELMA Investments are some of CarePay’s notable investors. 

Swvl (42M)

Topping the list as the most funded startup in Egypt is E-logistics startup Swvl that raised $42M in a Series C, bringing its total funding to $80M across 4 rounds. This round had participation from Vostok New Ventures, BECO Capital, Endeavor Catalyst amongst other investors.  At the end of the year, Swvl launched long distance trips in the Kenyan market after launching its commuter services to Naivasha, Meru and Nakuru.

PalmPay ($40M)

Transsion Holdings, NetEase and MediaTek all participated in a Seed round that saw Fintech PalmPay raise $40M as it launched into Nigeria, its second market after Ghana. The startup received its mobile money licence for Nigeria in July last year and has signed over 100,000 users to the pilot programme.

Lori Systems ($38.7M)

Hillhouse Capital, Crystal Stream, Echo VC and Endeavor Catalyst are some of the investors that participated in the $38.7M Series A rounds that saw e-logistics startup Lori Systems total venture funding grow to $49M across 3 rounds. Lori was recently selected along with AT Labs and SunCulture to host MIT Sloan School of Management and G-Lab’s  entrepreneurial projects. 

Twiga Foods ($23.75M)

Goldman Sachs led Twiga’s $23.75M Series C with participation from existing investors International Finance Corporation (IFC), TLCom Capital and Creadev. This brings the e-commerce platform’s total funding to $44.6M and ranks it among the most funded startups in Kenya. 

Jiji ($21M)

In a Series C round led by Dubai’s Knuru Capital, Lagos-based E-commerce platform raised $21M which was directed to increase transactions on its site. Jiji currently operates in Nigeria, Ghana, Uganda, Kenya and Tanzania. 

Boomplay Music ($20M)

Africa’s leading music streaming service raised a $20M Series A led by Maison Capital and Seas Capital. Boomplay signed a licencing deal with global music publisher Universal Music Group (UMG) to distribute music from UMG’s labels through its streaming service in Nigeria, Ghana, Kenya. Tanzania, Rwanda, Uganda and Zambia. 

Kobo360 ($20M)

Aside from raising $10M debt finance, e-logistics platform Kobo360 raised $20M in a Series A round led by Goldman Sachs, Asia Africa Investment, IFC, TLCom Partners and Y Combinator. Kobo also launched its regional office in Nairobi where it had been in beta operation 5 months prior with access to over 3000 trucks and truck owners. 

Migo ($20M)

Migo (formerly Mines) has raised a total of $36.1M across 4 venture rounds, with the recent being the 2019 Series B of $20M led by Valor Capital Group, the Rise Fund and Velocity Capital. Migo offers a platform that allows companies to offer credit to their customers. The company already counts MTN and 9Mobile among its clients.  

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