Monthly Roundup: August Funding drops by 53% compared to July

    Deals
    The Funding Brief

African startups raised $24.1M across 34 disclosed deals in August. This is over 74% less than 2019 that saw $93.4M raised across 42 rounds and 53.4% less than what was raised in July this year ($51.7M). The highest fundraise was $6M for Dataprophet by Knife Capital, Industrial Development Corporation of South Africa and Norican Group. Majority (17 startups) raised Grants amounting $212K followed by Seed (including Seed II) in 8 rounds amounting $3.7M. Nigeria Climate Innovation Center and All On emerged as the most active investors of the month dispersing $80K jointly investing in the same grant rounds.

Additionally, the bulk of the month’s funding ($22.1M of $24.1M) was raised by startups based in Nigeria (in 13 rounds), South Africa (in 8 rounds), Egypt (in 6 rounds) and Kenya (in 3 rounds). 9 companies out of all that raised were co-founded by women including Pricepally, Nvoicia, JamiiLife and Africa Foresight Group. Financial Services has continued to dominate as the most funded industry in Africa with startups securing 31.5% ($7.6M) of the month’s funding. This is followed closely by the Information Technology sector with 25.7% ($6.2M) and Agriculture with 10.4% ($2.5M).

To date, startups have raised over $382M in total across 40 rounds in a mixture of funds (both vc, debt finance and private equity.) We are seeing more Seed and Seed II rounds than Series A so far (115 rounds out of 227.) Seven funds have also been closed on the continent so far adding up to $662M. 

Here is a further breakdown of the top 10 deals of the month ($700K+); 

Ghana’s Africa Foresight Group raised $700K Seed from investors Consonance Investment Managers and GFH Holdings. The startup offers access to a large network of freelance management consultants on the continent, matching leading companies, investment funds and development partners with teams. The company has more than 100 consultants in its network and has completed more than 140 engagements so far. 

Dubai’s Global Ventures and Dutch Entrepreneurial Development Bank FMO led payments startup Paymob’s $3.5M Series A round with additional participation from existing investor A15. The platform offers the following solutions: the ability for online and offline merchants to make payments through and receive payments through a complete payment gateway that can be integrated into a merchant’s website or mobile app using its APIs, payment links to enable merchants receive payments by sharing a link with their customers and a POS solution that comes with its own POS device to receive in-store card payments. The funds raised will be used to expand into new markets in Africa and GCC.

Another Financial Service WorkPay made its second raise in a $2.1M Seed II round backed by Kepple Africa Ventures, Soma Capital, Musha Ventures and P1 Ventures bringing its total funds raised so far to $2.25M across 2 rounds. Founded in 2017 originally as TozzaPlus, the company rebranded in 2019 to WorkPay which is an HR management, payroll processing and secure salary disbursement platform for small and medium-sized businesses (SMBs) in Africa. The startup processes payrolls for more than 25,000 employees in Kenya and has more than 300 SMBs on its platform. The new investment will help the company scale its solution further across East Africa. 

Dataprophet is a South African based IT solution employing AI that enables manufacturers to step towards autonomous manufacturing. In the highest venture round of the month, the company made its second raise in a $6M Series A backed by Knife Capital, Industrial Development Corporation of South Africa and leading foundry engineering and equipment company Norican Group. The investment will fund its international expansion. This follows its newly formed partnership with Norican that was announced earlier this year to accelerate the adoption of AI in the foundry industry.

Malian off-grid solar company Energy+ secured a $1M investment from VentureBuilder, Cordaid Investment Management and United States African Development Foundation. The fund includes equity and fully funded enterprise development services from VentureBuilder, debt from Cordaid Investment Management, and grant financing from the United States African Development Foundation. These funds will be used to help close the electricity gap in Mali which has over 50% of its population living under the grid. 

Lightware LIDAR also received a $1.5M investment from Sanari Capital’s Fund 27Four. LightWare manufactures and develops a range of light-weight, general purpose LiDAR systems for use in drones, robots, autonomous vehicles, smart cities, and other applications. The COVID-19 pandemic has boosted sales of the products as a result of the contactless solutions its devices offer. The funds will be used to expand further its services. 

Aerobotics has made its second fundraise of the year worth $2M backed by FMO bringing its total investments in 2020 to $8M and total venture funding since inception to $12.7M across 7 rounds. The funds will be used to support the company’s operations, expansion and technology development. The company has advanced its technology to now engineer fruit counts, and to provide data on fruit size and colour additional to its drone technology and AI that helps farmers monitor their farms and optimise their yields. 

Transport and Logistics company Lori Systems also raised Debt Finance of $1.5M from undisclosed investors according to a SEC filing. This is the company’s most recent raise since 2019. The startup has previously raised venture capital to the tune of $45M across 4 rounds. Founded in Kenya in 2016, the company provides mobile-based on-demand trucking logistics services through a network of drivers and merchant partners with operations in Kenya, Uganda and Nigeria.

Cameroon-based Healthlane made its second raise in a $2.4M Series A backed by Digital Horizon, Sequoia Capital, Silicon Valley Bank, TSVC, Supernode Ventures, CRE Africa and Capitoria. This brings their total funding raised so far to $2.55M across 2 rounds. The platform allows users to book and pay for doctors’ appointments at public clinics through their app and be received immediately, saving time. The company co-operates with more than 30 medical institutions in Nigeria and Cameroon and had registered over 60,000 clients by the first half of this year. 

Financial Services company Yellow Card received a $1.5M Series A boost to launch its crypto exchange stance in Africa starting with expansion in Kenya and Cameroon as of September 1st. The investment came in from Andreessen Horowitz, Polychain, Celo and other investors. The company was founded in 2016 by Chris Maurice and Justin Poiroux  as Bitcoin gift card but later pivoted to Yellow Card with a mission of bringing Bitcoin to Africa. The company has operations in Kenya, Botswana, South Africa, Nigeria and Cameroon. 

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