The 2016 Venture Finance in Africa research has been released by VC4Africa and it shows that growing investor interest in African startups is resulting in tangible investments. Data from the 2016 research shows that the total invested capital more than doubled from almost $27 million to almost $73 million, secured by 224 ventures who took part in the survey. The average amount invested per venture also increased from $200,000 to $326, 000.
The data from the report showed that in terms of the number of ventures, ICT was leading with 40% followed by agriculture, e-commerce, mobile, education, diversified science and ending with renewable energy. It also showed that in terms of job creation, there has been a steady increase from 2009 to 2015 as companies are beginning to employ more people. The percentage of ventures that are making profit is lower than the percentage of ventures that are not making profit (40.7% and 59.3%). The main source of capital was founder capital which was followed by grants and competition. Out of the sample, a large marjority (85.8%) had invested in African companies giving credence to the statement that African startups and companies are becoming more popular. There is increased investor activity in Africa.
The VC4Africa community is a global peer-to-peer network where entrepreneurs and investors come together to build great African success stories. This is the third year that VC4Africa has endeavored in the research.
You can find out more about the research and its findings here.