African startups have raised more funding in 2025 than in 2024. By August, the total stood at about $2.8 billion, with the big four raising $2.4 billion out of it. Despite Nigeria’s reputation as Africa’s biggest startup hub, it barely raised up to $186 million, falling behind Kenya, South Africa, and Egypt after a four-year dominance.
It started the year with high momentum with the Lemfi deal, but South Africa and Kenya hosted most of the mega rounds and significant buyouts so far. For instance,South Africa’s hearX raised $100 million through a merger with a US-based firm, Eargo, marking the continent’s first mega-deal of the year in the healthtech sector.
According to the 2025 Africa Venture Pulse report by Briter, Kenya raised $879 million and South Africa $848 million, leaving the remainder shared between Egypt and Nigeria with $561 million and $186 million, respectively. In the same period of 2024, Nigeria was leading with $353 million,followed closely by Egypt with $330 million, then Kenya $322 million, and South Africa $200 million. Nigeria coming last among the big four shows a sharp decline in startup funding compared to the first eight months of 2024.
This signifies a reversal of fortune from Nigeria’s initial period of dominance in 2021 and 2022. An all too familiar story in the West African nation’s history, where it has lagged behind in underdevelopment despite starting at pole position.
Previously, the country was a magnet for venture dollars, but today it is weighed down by macroeconomic volatility such as currency devaluation, inflation, and political instability, alongside global capital tightening. On the domestic side, issues like the “japa” talent drain, regulatory uncertainty, and overreliance on foreign investment have deepened the decline. In 2024, Nigeria still managed to raise the second-highest funding among the big four, behind Kenya. But at the current pace, 2025 could close with a much lower tally.
Click to signupAlso, Fintech remains the sector attracting the largest share of investment, but cleantech has emerged as the fastest-growing category, as just three deals accounted for nearly half of all funding, pulling in about $1 billion, largely through debt financing.
The paradox is striking. Nigeria has the largest number of startups in Africa. In 2022, the country had more than 1,288 newly founded tech startups, compared to South Africa’s 490, Egypt’s 667, and Kenya’s 308. As of September 2025, Tracxn data showed over 20,671 startups in Nigeria. Yet the country is securing around 15% of the continent’s funds raised as of September this year.
Still, signs of hope remain. The fourth quarter could yet improve Nigeria’s position, especially given its massive, youthful population, expanding data infrastructure, and enduring fintech dominance. International investors such as Visa, QED , and the Gates Foundation continue to see Nigeria as a high-potential market. With its entrepreneurial energy intact, the ecosystem may still pull a late-year recovery.
