The Future of Entrepreneurship in Africa: 2026 Report

African startups raised an estimated $3.9 billion across 506 deals in 2025, and domestic investors now account for 45 percent of total venture fund commitments — up from an average of 23 percent between 2022 and 2024 — signaling a meaningful shift toward local capital deployment and a maturing funding ecosystem. Disrupt Africa reported that tech investment rose nearly 50 percent in 2025 to $1.64 billion across 178 startups, while a separate tracker recorded a 33 percent year-on-year rise in startup funding. Venture debt also surged to $1.8 billion in 2025, and energy and climate companies drew roughly $1.2 billion, overtaking fintech by capital raised.

"2024 was a genuinely difficult year for the sector, but 2025 brought real momentum back, even though funding has not fully returned to earlier peaks," said Gabriella Mulligan, co-founder of Disrupt Africa.

Those headline numbers sit alongside demographic and infrastructure realities that underpin entrepreneurship across the continent. More than 60 percent of Africa’s population is under 25, and by 2030 young Africans are expected to make up 42 percent of the world’s youth. Small and medium enterprises (SMEs) remain the backbone of the economy: they represent an estimated 80–90 percent of jobs and up to 90 percent of registered businesses, and more than one in five working-age Africans are actively starting or running a new venture.

Women entrepreneurs are central to this growth story but remain underserved. Sub-Saharan Africa records the world’s highest rate of female entrepreneurial activity, at about 26 percent; women make up 58 percent of Africa’s self-employed population and contribute nearly 13 percent of GDP. Yet access to capital lags: the continent faces a $42 billion financing gap for women founders. At the broader SME level, research cited a $331 billion financing shortfall across Africa.

Digital infrastructure, particularly mobile money, is a critical enabler. In 2025 the continent had some 1.2 billion registered mobile money accounts and processed $1.4 trillion in mobile money transactions, providing financial services to entrepreneurs who rarely access traditional banks.

• Regional funding patterns in the first half of 2025: Egypt led with more than $330 million (about 31% of the total), followed by South Africa at 26%, Nigeria at 15%, and Kenya at 12% (data compiled by Africa: The Big Deal).
• Nigeria reclaimed the highest deal count by year-end, while Kenya and South Africa captured the largest checks.
• Exits rose: 34 venture-backed exits were recorded in 2025, a 31% increase year-on-year, with trade sales comprising over 70% of exit volume and value. Southern Africa accounted for $288 million of exit value, and North Africa led by number of exits.

The sector mix is shifting toward the physical economy. Investors allocated large sums to solar, off-grid electricity, storage and transport, favoring businesses with clear revenue models and manageable leverage over rapid, app-based growth. That trend, combined with rising use of venture debt, suggests founders are prioritizing runway extension and ownership retention.

Outlook: the data and fieldwork behind the figures point to entrepreneurship in Africa becoming less dependent on external capital and more rooted in local investors, youth-driven demand and digital financial infrastructure. Persistent gaps remain — notably a multibillion-dollar shortfall for SMEs and women-led businesses — but the 2025 recovery in funding, growing exit activity and shifting investor preferences indicate a more sustainable foundation for founders. The central question now is how quickly policy makers, investors and international partners close financing gaps so the continent’s entrepreneurial momentum can scale.