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Acquisitions Rise in Africa Following Investment Stagnation

Acquisitions have become far more frequent in Africa’s technology ecosystem, with 2022 already surpassing the number of acquisitions in 2021. 

The findings regarding acquisitions in Africa come from a new report from Africa-based digital economy consultancy TechCabal Insights. According to the report, 32 acquisition deals took place across Africa in 2021. At the end of Q3 2022, there had been around 43 acquisition deals in the continent.

The consultancy company suggests that this data indicates a consolidation trend for Africa and that its market is “maturing”.

Venture capital investment had seen continuous growth in Africa over the last two years, followed by a levelling off in the amount of investment. Because of this trend, some African startups have had to cut costs to increase the number of months before funds run out. This has meant that acquisition deals have become necessary for the survival of such companies, especially concerning startups operating in the same market.

The number of acquisitions between startups operating in the same market increased from 31 per cent in Q2 2022 to 52 per cent in Q3 2022.

Olanrewaju Odunowo, TechCabal on acquisitions
Olanrewaju Odunowo, head of TechCabal Insights

Olanrewaju Odunowo, head of TechCabal Insights, offered his views on the report. Odunowo commented: “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. ”

Tougher times ahead for African startups?

TechCabal’s report suggests that despite a positive trend in investment growth, the story has not always been bright for African startups. Between 2015 and 2021, investment in African startups grew by 18 times. Investment in Africa also grew twice as fast as the global rates between 2020 and 2021.

Funding increase aside, it also appears that life has not been plain sailing for startups in the region. TechCabal details how by the end of H1 2022, African-focused private capital investors had made 22 full exits. The statistic represents a 29 per cent increase in exits compared to the number made in the first half of 2021 (15).

Of 35 startups that reached out to TechCabal, 37 per cent were in fintech. The stat highlights the fact that fintech remains the fastest-growing sector in Africa.


  • Tom joined The Fintech Times in 2022 as part of the operations team; later joining the editorial team as a journalist.

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