The African tech ecosystem is a growing one, not just because of the rate at which the continent’s startups are raising fundings but because of Africa’s participation in relatively new tech niches.
At the moment, FinTechs lead the continent’s tech ecosystem by a wide margin as only the niche gained 63% or $3 billion of the funding that went to African startups in 2021. According to a report from TechCabal’s funding tracker, FinTechs are still putting on a good show in 2022, seeing that they have attracted fundings over $660 million (June 2022).
What are the other tech niches gaining traction and getting significant funding in Africa?
With the world entering the Fourth Industrial Revolution classified by disruptive technologies and trending niches including robotics, virtual reality (VR) and artificial intelligence (AI) many feared Africans would be left behind as the continent raised just $11.63 in 2020 when global AI companies raised $36 billion. But, in 2022, AI companies on the continent have out-performed previous years, as the niche has gained over $100 million so far. Popular AI companies in Africa include InstaDeep.
African communities all over the continent including Kenya, Nigeria, Ethiopia and Somalia are facing the worst food crisis seen in four decades as 346 million people on the continent are affected by the food crisis, according to reports by the Food and Agriculture Organization (FAO) and the African Union (AU) in May 2022. To provide tech related solutions to this crisis, African Agritech companies have raised over $115 million.
The global pandemic of 2020 raised the need for edtech solutions in Africa and other parts of the world. As such, edtech companies around the world tapped this industry and raised $20 billion. In comparison, African edtech companies raised below $40 million. However, this industry is gaining traction as companies including Ulesson and Foondamate are making giant strides.
Africa is the continent with the highest number of people with no access to internet and electricity with 75 percent. This figure inspires the need for cleantech solutions, an industry that approaches the innovation of products or services to reduce damage to the environment. Cleantech stands as the second most funded niche to FinTech. Cleantech companies, including SunKing, raised $280 million to increase the provision of power to customers in Africa and Asia.