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Last week, MFS Africa announced that it had raised $100 million to extend its Series C funding round to $200 million. The news was very significant for the African tech ecosystem which hasn’t seen any sizable fundraise of up to $100 million since Q1 2022.
READ: Briter Bridges’ founder Dario Giuliani says African startups are poised to raise more billions in 2022
As you may be aware, Q2 2022 has been characterised by a “funding crunch” from global VC firms. According to Crunchbase, there has been a steady decline in VC funding over the past months. And African startups haven’t been spared from the trend. As a result, there has been a significant slowdown in the amount they’ve raised, especially when compared to what obtained in Q1 2022.
But despite this challenge, analysts believe there is reason to be optimistic. According to the Managing Partner at HAVAIC Ian Lessem who spoke to Bloomberg recently, growth in VC funding in 2022 will most likely surpass what was recorded last year. However, it would most likely be subdued growth.
“We still see that African venture capital will be up year-on-year, albeit at a more subdued growth rate. The fundamentals for a lot of the businesses in Africa remain very very strong. Good businesses will always raise capital. They may have to work a little bit harder,” Lessem said.
READ: Tanzania joins a growing number of African countries imposing digital tax on big global tech firms
Already, the African startup ecosystem have attracted over $2.5 billion worth of investments in the past 5-6 months, according to Futuregrowth Asset Management. And the funds will continue to come in for as long as business growth opportunities remain in the African market.
An earlier article by Business Insider Africa detailed a list of African startups that have received the most funding in 2022. So, be sure to read up on that by following the link below.
READ: 12 African startups that have announced the largest funding rounds so far in 2022
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