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African Fintechs Continue to Attract Record Levels of Acquisitions

Disrupt Africa’s “Finnovating for Africa” publication, released every 2 years since June 2017, tracks the extraordinary development of the fintech ecosystem across Africa. The fourth edition of the report was released in partnership with AZA Finance and Curacel. The report shows that the fintech startup ecosystem is continuing on its growth trajectory, with the number of startups operating in the space increasing by 17.7% to 678 in 2023 as compared to 2021. Meanwhile, fintech ventures have raised more than $2.7bn in VC funding in the last 2 years, having seen unprecedented growth. There has also been an uptick in M&A activity. Geographically, Nigeria is a clear leader in the fintech space, but from a vertical perspective, the picture is more nuanced.

Disrupt Africa data suggests companies are much more likely to be acquired as a fintech business than in any other vertical. 26 ventures were bought out in the last 24 months, up from just 7 in the period between 2019 and 2021. SA has generally led the way, accounting for 10 of the deals over the last 2 years, and 16 overall. The most famous ones remain the acquisition in 2011 of mobile financial services provider Fundamo by Visa for $110m, and the buyout of SnapScan by Standard Bank in 2016. Nigeria was the location for the flagship fintech acquisition of recent years – Paystack’s reported $200m acquisition by Stripe in 2020, a big moment that ignited increased interest in the continent’s fintech space.  Startups in Morocco, Ivory Coast, Egypt, Kenya, Rwanda, Zambia, and Tunisia have also been acquired in the last 2 years.

Alastair Tempest

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