Africa's fintech sector was the most popular among investors in 2019 with 77 African fintech startups raising a combined US$107 million during the year. This is according to the annual African Tech Startups Funding Report 2019 released by startup news and research portal Disrupt Africa
The report, which is now in its fifth year, showed that 2019 was the best year so far for investment into the African tech startup space, with 311 companies banking a combined $491.6 million in the year.
"Investment in the African tech space continues to grow and grow, and at the current rate of development it won't be too long before we are talking about it breaching the US$1 billion mark. Beyond the headline numbers, however, it is exciting to see the growth in particular markets and verticals as investors diversify and expand their interests on the continent," said Tom Jackson, co-founder of Disrupt Africa.
The report, which tracks the total amount of funding raised by African tech startups each year, found the number of startups that secured investment increased by more than 50% on 2018, while total funding grew 47%.
This made 2019 a record year for funding, driven by a 61% increase in the number of investors in African tech startups, which reached 261.
Despite the popularity of fintech startups, fintech's share of total funding actually fell to 21.8% from 39.7% as other sectors like logistics, transport, e-commerce, agri-tech and e-health, enjoyed bumper years.
Around 77 African fintech startups raised a combined $107 million in 2019.
The report found that Kenya and Nigeria were the lead markets in terms of total funding, securing $149 million and $122 million respectively in funding, though Egypt was the main market in terms of startup numbers, with 88 companies raising funding over the course of the year. South Africa fell to fourth place in both regards.
With investors increasingly looking beyond the established hubs of South Africa, Nigeria and Kenya for opportunities, the continued development of the Egyptian tech space is a key trend, while Disrupt Africa also tracked investment in an additional 15 African countries.
"The five years of data show our ecosystem has developed in leaps and bounds; yet is still in the early stages of an incredible growth story powered by the innovation and tenacity of African entrepreneurs, and the confidence and support of the continent's investors. We look forward to documenting the continued rise of the ecosystem over the next five years too," added Disrupt Africa co-founder Gabriella Mulligan.
— The Staff, Connecting Africa