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Grace Ashiru
Nigeria and other African startups have kicked off 2025 on a strong note, with funding into the ecosystem surging by 240 percent year-on-year to reach $289 million in January. This marks a significant increase compared to the $85 million raised in January 2024.
Despite the lower figures in 2024, that period still ranked as the second-best January for startup funding since at least 2019, trailing only January 2022, which saw peak investment activity during the funding boom, according to data from Africa: The Big Deal, a funding tracker.
The report further highlights that equity financing remained the dominant source of capital, accounting for over 90 percent of the total funds raised. This translates to $262 million—an impressive leap from the previous year. Additionally, it represents the second-highest amount raised through equity financing in any January over the past six years.
According to Africa: The Big Deal, the four largest funding deals in January 2025 came from Africa’s “Big Four” nations—Nigeria, Kenya, Egypt, and South Africa—collectively accounting for approximately 60% of the continent’s total capital raised during the month.
In its report, The Big Deal highlighted some of the most significant investments, noting that PowerGen, an energy-focused startup, secured over $50 million to build a scalable platform for distributed renewable energy solutions across Africa. Meanwhile, LemFi, a fintech company, raised $53 million to support its expansion into Asia and Europe.
Naked, an insurtech company, has secured $38 million in a Series B funding round to enhance automation and expand its product offerings. Meanwhile, Enko Education has raised $24 million to further grow its network of schools across Africa.
A notable trend emerging from these deals is the increasing number of African startups scaling their operations beyond the continent. Industry experts suggest that the funding activity in January 2025 signals a positive shift for Africa’s startup ecosystem, which faced considerable challenges in securing investments throughout 2023 and 2024. Last year, African startups accounted for less than 1% of global funding, raising only $1.5 billion in equity.
Davidson Oturu, general partner at Nubia Capital, emphasized that Nigerian startups have substantial opportunities to position themselves more competitively for funding in 2025.
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