Old Wounds Keep Africa’s Tech Investors Cautious Despite Loads Of Dry Powder

While Africa’s startup ecosystem brims with opportunities, particularly in tech, the global funding slowdown has left investors and founders alike on edge. But even amid this uncertainty, Africa-focused investors have remained steadfast, adjusting their strategies to navigate both regional and global shifts.

And, despite the shakeup which has already claimed significant casualties, these investors continue to get buy-in. Indeed, fundraising by Africa-focused investors has defied the crunch and managed to hit the high notes in an otherwise subdued investment landscape over the last few years. In 2024, a range of venture capital firms—including TLcom Capital, Verod-Kepple Africa Ventures, Janngo Capital, Partech Africa, and Breega—raised over half a billion dollars to support African startups.

Other key players like Norrsken22 and Algebra Ventures have, in recent years, also raised substantial funds to back African startups from pre-seed to Series C.

However, despite having significant "dry powder"—capital yet to be deployed—these investors are more cautious than ever, armed with lessons learned from previous market disruptions.

In a series of interviews with four leading African tech investors, WT gets a sense of the cautious optimism that permeates the continent’s venture capital scene as we enter 2025. From sector-specific strategies to hands-on founder support, the approaches vary, but the themes are consistent: selective investing, resilience in the face of adversity, and a sharp focus on profitability over growth at all costs.