African startups raised $597m in Q1 2026; but fewer ventures are getting the money

The year 2026 has started pretty well as far as funding for African startups is concerned. Data reveals that $597 million was raised by ventures across the continent in the first quarter of the year.

This is according to numbers crunched by Technext across the first three months of the year.

The total marks a significant increase from the $469 million raised during the same period in 2025, representing a 27.3 per cent increase. However, on a quarter-to-quarter basis, it falls short of the $950 million raised in the fourth quarter of 2025, a 37.1 per cent shortfall.

In January 2026, startups across the continent raised a total of $174 million led by Egyptian Fintech, valU, with $64 million secured in debt from the Egyptian National Bank.

Nigerian mobility startup, MAX, also raised $24 million in equity and asset-backed debt during the month. Egyptian Fintech, NowPay, raised $20 million, Moroccan Proptech, Yakeey, raised $15 million in a series A round, and defence tech startup, Terra, raised $12 million.

Benin-based e-mobility company, Spiro, led the pack in February with it’s $57 million round as startups raised $272 million in February, a 56.3 per cent monthly increase.

Other startups that contributed with major rounds include Egypt-based e-commerce startup, Breadfast, which raised $50 million, and Ivorian mobility fintech GoCab, which closed a $45 million round.

Nigerian defence technology startup, Terra Industries, raised another $22 million, South African edtech, Enko Education, which raised $22 million in debt financing, and another South African startup, Lula, which secured a $21 million investment.

African startups raised $151 million in March led by Sistema.bio with the close of its $53 million debt round. Egypt’s fintech giant, MNT-Halan, raised $40 million with the completion of its bond issuance, while Zeno, an East Africa-based electric mobility startup, completed the top three raising $25 million in Series A funding.

Notably, the first quarter funding numbers were that debt funding pipped equity, with a little bit more coming in the form of debt. Of the total $597 million raised, $304 million came in the form of debt, representing nearly 51 per cent. $291 million came in the form of equity, representing 48.7 per cent of the total.

The balance of $2 million came in the form of grants.

This is vastly different from the first quarter of 2025 when $397 million, representing 89 per cent of the $469 million raised came in the form of equity. Only $52 million representing 11 per cent came in the form of debt.

Yet, fewer startups are getting funding

While the African venture space has witnessed an improvement in the amount of funding, the money appears to be getting to fewer startups than usual. In March 2026, only 22 startups announced funding. This makes last month’s tally the lowest monthly count since 2021.

In January, that number was 26, though it witnessed a bump in February when up to 40 startups announced funding.

The trend is more worrying for early-stage startups raising less than $500,000. Over the past 12 months, only 130 early-stage startups have announced funding of between $100,000 and $500,000 in equity. This also represents the lowest over 12 months since at least 2021.

Thus, startup funding into the continent has relied heavily on few larger deals, while smaller deals, especially for early-stage startups have continued to dwindle, a trend Technext analysis has been pointing out for a while. As of July, 2025, Technext reported that early-stage investments dropped from 87 per cent of total equity funding in 2024 to 61 per cent.

Essentially, it means there is less and less funding for the younger startups to innovate. And this is a major source for concern.