The Most Surprising African Tech Startup Venture Rounds Of 2021

Emerging from almost nothing to billions of dollars in less than a decade, getting Silicon Valley to play the VC game in the last frontier, and defying the global tech slowdown of 2020 are but a few of the feats permanently placing the African tech ecosystem on the world map.

As the local internet space grows in preparation for the continent’s next billion, cheque sizes impressively increase, and venture rounds become excitingly more frequent. 

In 2019, the annual value of venture backing for African startups crossed the billion-dollar mark to herald a new dawn for the region’s tech economy. Though funding activities mildly subsided in 2020 due to the pandemic, this nearly-concluded year brought on some record-breakers and show-stoppers; USD 100 M rounds were normalized, a handful of startups joined the unicorn club, and certain markets—as well as countries—received investor attention for the first time.

As the year snowballs to an end, we are somewhat contractually obligated to highlight some of the biggest showdowns of the last 12 months. Since venture-backed African tech startups are our breakfast and brunch, we figured to serve you a plateful of the continent’s most unprecedented funding rounds for what is no doubt a historic 2021. 

Lami’s USD 1.8 M Seed

In the Kenyan tech ecosystem, ex-pat founders have the upper hand. There is a shortage of well-funded, indigenous early-stage firms and a dearth of venture capital from both local and international sources. 

In 2019, of the Big Four African tech economies, Kenya had the highest concentration of ex-pat co-founders. Meanwhile, male founders dominate the world of venture capital reception, with women-led companies attracting less than 5 percent of global venture backing. 

Nevertheless, Lami, a B2B2C API insurtech with a female founder and CEO (Jihan Abass), raised USD 1.8 M in seed to scale its digital insurance product across Africa. The company started in 2018 and claimed to be on a steady growth path to revolutionizing African insurance. 

Kune’s USD 1 M Pre-Seed

As already stated, when it comes to raising venture capital, Kenyan startups with ex-pat founders or co-founders often get it better. Validating this, Kune, a foodtech startup barely six months old at the time, was served quite the plateful in VC money; USD 1 M in pre-seed to build a full-stack, cloud kitchen platform from Kenya to across Africa. 

The investment remains one of the largest non-fintech funding rounds in the continent and—despite controversies that followed—was a valuable drop into the not-so-stuffed African foodtech basket. Unlike most business models in this space, Kune’s involves owning, operating, and managing the entire value chain, from the factory to the kitchen counter. 

Naked Insurance’s USD 11 M Series A

Naspers Foundry—the high-profile but low-flying investment vehicle of Africa’s most valuable company by market cap, Naspers—made only three investments this year to take its portfolio to 7 South African startups. While the VC outfit started 2021 by pumping USD 14.5 M into WhereIsMyTransport, Naspers Foundry followed on by writing a USD 2.3 M cheque to Ctrl, an insurtech. 

Knowing the design of investment vehicle Naspers has set up—one that invests overly selectively—no one expected another backing for a while after hitting it with Ctrl. But, less than a fortnight later, it took the lead in a USD 11 M Series A round for Naked Insurance, coincidentally another South African insurtech startup—however with a different business model. 

Trella’s USD 42 M Series A

It is no uncommon development for a North African startup to raise a sum marginally more than their counterparts in Sub-Saharan Africa. But Trella, an Egyptian trucking marketplace that began in 2019, seemed to take things to another level by securing USD 42 M in Series A: USD 30 M in equity and USD 12 M in debt financing to fuel its growth and become a leader in MENA’s freight market. 

Trella’s raise, interestingly, marked the African entry of Maersk Growth, the VC arm of Maersk, the world’s largest integrated shipping company. The venture vehicle was set up in 2017 and has made 32 investments, 18 of which it led. Catch this exclusive chat I had with Jeppe Hoier, Partner at Maersk Growth, on why Cairo-headquartered Trella was worth the big bet. 

Wave’s USD 200 M Series A

When it comes to venture funding into Africa, the English-speaking countries are often in the limelight. As Anglophone Africa produces billion-dollar ventures such as Interswitch, JUMIA, Fawry, Flutterwave, and Chipper Cash, Francophone Africa is still in its early days of VC attention. Unlike English-speaking Africa, the sub-region is home to promising tech startups in dire need of financial support. 

2021 was the first time a Francophone African tech startup reached unicorn status, after Sequoia and a league of other VCs invested a Series A of USD 200 M into Wave, a mobile money-based fintech based in Dakar, Senegal. Wave is a spinoff from Sendwave, an Africa-focused remittance startup acquired by WorldRemit in February for a rumored USD 500 M. Following the round, Wave was valued at USD 1.7 B. Read more here. 

Kuda’s USD 55 M Series B

Before 2019, venture backing in these parts was more or less a proverbial drop in the bottomless bucket. Though there was also a later increase in the amount of funding going into African early-stage firms, there wasn’t still enough venture capital to go around. Two years later, a few of these tech firms seem capable of not only raising two huge rounds in one year but also receiving venture capital just for keeps—rather than for immediate use. 

One of such companies is Kuda, a Nigerian challenger bank looking to digitally bank every African on the planet. While the fintech secured its pre-seed (USD 1 M) in 2019 and seed (USD 10 M) in 2020, the startup bagged both Series A and Series B—USD 25 M and USD 55 M—respectively this year. After raising the former in March, it raised the latter in August to double down on its Nigerian services and prepare to launch in other African markets. 

Mono’s USD 15 M Series A

Another startup in the do-it-all-in-a-short–time category is Mono, an API fintech building from Nigeria, the Plaid for Africa. The startup, which entered the market with a play to connect consumers’ bank accounts to financial applications, joined Y Combinator in February. Three months into the American accelerator, Mono switched to simply powering Africa’s internet economy and secured USD 2 Mn in seed to realize those ambitions. 

But, Mono didn’t stop there. After closing its seed round in May, the startup bagged a Tiger Global-led Series A of USD 15 M in October, bringing the total funding of its one-year operations to USD 17.5 M. With the funds, Mono intends to set up shop in 5 more African countries and offer FMCG solutions to a selected clientele. Word on the street was: Mono had no plans to raise another round this year, but Tiger Global insisted on injecting more capital to double the firm’s growth. 

Andela’s USD 200 M 

In the entire African innovation space, Andela is one of the earliest players and most promising startups. It is, after all, the only company backed by Serena Ventures, the VC company of multi-award-winning American tennis player Serena Williams. Nevertheless, despite receiving a substantial amount of VC money and realizing as much as USD 50 M in 2019 revenue, Andela laid off its developers not once but twice. Junior developers exited in November 2019, and mid-level developers followed in February 2020. 

For most of 2021, the talent sourcing firm has been about remote work and expanding its services across the continent to become a pan-African company. Amidst these changes, American freelancer marketplace, TopTal, filed a lawsuit against the company, alleging the violation of confidentiality and non-compete agreements on the part of its ex-employees now working with Andela. However, thanks to a SoftBank-led Series E of USD 200 M, Andela finally became a unicorn. 

Chipper Cash’s USD 150 M Series C Extension

In May, African cross-border, no-fee fintech, Chipper Cash, announced it had raised USD 100 M in Series C round led by Silicon Valley Bank. The investment valued the startup at over USD 1 B, making it Africa’s most valuable startup. At the time, Chipper Cash’s unicorn status was debated among stakeholders and enthusiasts. 

In November, things became much clearer valuation-wise as the company raised a Series C extension of USD 150 M led by FXT, Sam Bankman-Fried’s cryptocurrency exchange. The round valued Chipper Cash at USD 2 B and brought its total funding to USD 310 M. As is almost obvious, the fintech is not in immediate need of these funds, having raised USD 100 M six months earlier. Read more here. 

TradeDepot’s USD 110 M Series A

As far as the mega VC rounds of Africa are concerned, fintechs have the prerogative. 2021 heralded a status quo change as non-fintechs started to raise a few million dollars at the seed levels. One of the sectors receiving remarkably more funding is retail tech, as fresh-out players such as Omnibiz, Alerzo, Suplias, Asilimia, and MarketForce raise big to build for different segments of Africa’s informal economy. 

Nigeria’s TradeDepot is one of the earliest players in the space—having been around for five years—and one of the most recent to onboard investors. This month, the Nigerian B2B eCommerce retail firm raised USD 110 Mn in Series A co-led by Partech Africa and the International Finance Corporation (IFC). TradeDepot will use the round—unarguably the largest of its kind—to bring BNPL to African retailers. 

ULesson’s USD 15 M Series A

Edtech is one of Africa’s less glamorous innovation sectors, apparently because the art of building for learners is, by itself, a learning process. At first, African edtech was mostly a play to replace the teachers by offering students televised lectures outside the classrooms. But even while the pandemic formed a springboard for edtech elsewhere, it refused to take off in Africa, with few players and fewer willing funders. 

Despite African edtech more or less failing the pandemic test, the fog in the space seems to have cleared out post-COVID-19. In an interview with WeeTracker, Dimeji Falana, Founder and CEO of Nigeria’s Edves—submitted that building for the continent’s edtech industry has gone beyond casting lots to focus on building around (not outside) the educators. A few months later, Sim Shagaya’s ULesson, also Nigerian-born, raised USD 15 Mn in a Neilsen Ventures-led Series A, the largest of such for an African edtech. 

Ozow’s USD 45 M Series B

The South African financial markets are dominated by banks that are some of the biggest in Africa, and the country’s credit card system is well developed. In fact, most of the biggest banks in Nigeria, the continent’s largest economy, are on SWIFT via South African banks (not directly). As such, up to 80 percent of South Africans have been included in the banking system. 

However, only 24 percent of the country’s 59 million people perform over three transactions daily. While fintechs are either rare or not well funded here, Ozow proved there is still much to explore by raising USD 45 M in a Tencent-led Series B. Before this round, the fintech had secured angel rounds for its seed and USD 2.5 M in Series A. 

Expensya’s USD 20 M Series B

Tunisia has one of the most active tech economies in North Africa, although relatively slow in growth compared to nests like Egypt, Algeria, and Morocco. In May, Expensya, an expense management software raised USD 20 M in Series B to make the startup the best-funded not only in Tunisia but also in the Middle East and North Africa (MENA). The startup began in 2014, and is now operational in more than 100 countries.

In 2021, some new African countries also stepped into the venture funding limelight. 

Alsoug’s USD 5 M 

In October 2021, Sudan’s Alsoug, a classifieds marketplace, raised what was reported as the first foreign investment into the Northeastern African country’s quite nascent tech space. The USD 5 M unspecified round was co-led by Fawry, a fintech company that is Egypt’s first tech startup unicorn, and a consortium of western investors. Alsoug said the funds would go into building a national payments infrastructure for Sudan. 

MyJouleBox’s USD 3 M

Renewable energy is another sector in African innovation where venture capital is quite active. In a bid to offer clean energy solutions to the world’s least electrified region, companies such as M-KOPA, The Sun Exchange, and PEG Africa have shown there is just about enough movement in the industry. On the heels of this, 10-year-old MyJouleBox raised USD 3 M from a consortium that included EDFI ElectriFi, a European Union funding mechanism that provides USD 1.5 M under the country window. It is the first known funding round for a Beninese startup and came roughly a month after MyJouleBox raised a separate USD 1.8 M.

OKO Finance’s USD 1 M Seed

Supposing you are familiar with the Malawian context, chances are you know the Francophone West African country only as one of the biggest gold producers in the continent. Indeed, before now, that was all there is; the country’s tech ecosystem is all but inactive. But in April, OKO Finance flashed a torch in the all but dormant internet economy by raising USD 1 M in seed to bring innovative insurance to African smallholder farmers. With the funds, the insurtech is headed to the rest of West Africa. 

Nuru’s USD 1.2 M

The tech ecosystem inactivity also applies to the Democratic Republic of Congo (DRC), which we heard of this year by virtue of Project Taara’s progress in The Congos. However, Nuru, which started in 2015 and sells as a developer of hybrid solar off-grids, secured USD 1.2 M from Proparco to deploy its solutions in hopes of providing electricity to at least 5 million people by 2024. The investment is by any means the first of such to emerge from the DRC. 

Union54’s USD 3 M Seed

Union54, an API that enables African software companies to issue and manage their debit cards without banks or third-party processors, is the first Zambian startup to get into Y Combinator. Likewise it is the first startup from the Southern African country to receive venture capital after securing USD 3 M from the VC juggernaut known as Tiger Global.

AlphaDirect’s USD 600 K Pre-Series A

In April, AlphaDirect, an insurtech that operates a B2C “value-for-money” business and personal insurance products, raised USD 600 K in pre-Serie A to mark the first startup venture backing for Botswana since 2019. The company it would use the funds to launch in Zambia and South Africa.