The video conferencing space is indeed thriving due to its rapid adoption of other technologies which include the use of AI alongside other enhancements….
A new report from leading digital economy consultancy TechCabal Insights has revealed that acquisitions have become more frequent in Africa’s tech ecosystem, showing signs of a maturing market.
According to the report, 2021 saw 32 acquisition deals on the continent. At the end of third quarter of 2022, there were about 43 acquisition deals, signalling a consolidation trend.
After two years of continuous growth in venture capital investment, funding announcements have hit a plateau. Start-ups have resorted to cutting costs to extend their runway, and acquisition deals have become necessary for survival, particularly with start-ups operating in the same market.
The number of acquisitions between start-ups operating in the same market increased from 31% in the second quarter to 52% in the third quarter of 2022.
The State of Tech in Africa Report also found that the average seed ticket size remained stable at $2.5 million in quarter two and $2.7 million in quarter three.
A new narrative has emerged in Africa in recent years, embodied by the exponential growth of funding for technology start-ups. Investment in African start-ups grew 18 time between 2015 and 2021 and 2 times faster than global rates between 2020 and 2021.
However, beyond the funding stories, there are the quieter tales of exits. By the end of the first half of 2022, African-focused private capital investors had already made 22 full exits, representing about a 29% increase compared to the 15 exits made in 2021’s first six months.
Commenting on the ﬁndings of the report, Olanrewaju Odunowo, head of TechCabal Insights, said “When it comes to Africa’s evolving tech ecosystem, appropriate context and nuances must be taken into account. Data without context is imbalanced and misleading and can lead to the wrong outcomes.
“Beyond crunching the numbers, we have gathered robust insights drawn from primary interviews with leading industry experts. Our aim with this report is to present easy-to-digest insights and data points that anyone – from founders to investors – will ﬁnd valuable. ”
Click here to read the latest edition of The State of Tech Report.