African agriculture lags behind in attracting seed capital

Start-ups in Africa have increasingly been accessing more financing in seed, early-stage, and late-stage capital, signaling an improving investment landscape for the continent’s budding companies. However, start-ups in the most crucial sectors are still lagging behind.

Latest reports indicate that last year, African start-ups attracted unprecedented amounts of funding from venture capitals, hubs, and accelerators, among other investors, defying the difficult economic times that saw investors retreat from African financial markets.

According to the African Private Equity and Venture Capital Association (AVCA), the continent’s start-ups raised a total of $3.5 billion in the first half of 2022, a 133 percent growth compared with the same period in 2021. Based on the latest AVCA Report, the majority of the financing raised went to start-ups in Financial Technology (FinTech), Information Technology, industrials, energy and utilities, and e-commerce sectors.

In the same period, start-ups in the education, health, and agricultural sectors raised the least amount of financing, albeit with some growth, indicating investors’ reluctance to finance these areas, which have been touted as the most crucial for Africa’s prosperity right now when multiple shocks are compounding on the continent.


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