Startup Funding Jumps as Deals Drop Across Africa in Q1 2026

African startup funding reached US$676 million across 69 deals in Q1 2026, more than doubling the US$293 million recorded in Q1 2025. The headline growth comes with a caveat: deal volume fell 43%, from 120 to 69 transactions. Average deal size jumped from US$2.4M to US$9.8M — a figure that barely moved in the two prior years — driven by a small cluster of large transactions rather than broad ecosystem expansion.

Three countries accounted for nearly 60% of total capital. Seychelles led the quarter with a single US$200M deal in March, a significant step up from its Q1 2025 figure of US$14M. Egypt came second at US$121M across just five deals, continuing a steady upward run: US$34M in Q1 2024, US$71M in Q1 2025, US$121M now. Comoros rounded out the top three with a US$80M single transaction.

Nigeria and South Africa both posted subdued quarters. Nigeria raised US$79M across 19 deals — a recovery from Q1 2025's US$16M, but well below the US$171M it recorded in Q1 2024. South Africa brought in US$51M across 13 deals, continuing a two-year decline from a Q1 2024 high of US$199M. Neither market collapsed, but neither is growing.

Kenya's numbers tell a starker story. From US$68M across 42 deals in Q1 2024, to US$55M across 25 in Q1 2025, to US$6.3M across 9 in Q1 2026 — three consecutive quarters of decline, both in capital and deal count. Whether that reflects a structural cooling or a reporting gap will become clearer over time, but Q1 2026 is Kenya's lowest quarterly total in at least three years.

West Africa put up numbers worth noting. Benin closed a US$50M round and Côte d'Ivoire recorded US$45M across two deals — markets that rarely feature in continental funding tallies at this size. Morocco held steady at US$20M, in line with recent quarters.

At the stage level, seed and pre-seed rounds dominated by count. Debt financing made up a larger share than in prior periods — 13 of 69 transactions — with founders increasingly reaching for non-dilutive structures. Whether that's a preference or a response to tighter equity terms is hard to say from the data alone, but the shift is visible.