Seeds of Opportunity: The African Growth Series
August 2022 | Issue 2
In this week's issue, you will learn more about:
- Funding Africa's Women-led Innovation
- Africa's Energy Transition - Growing Gas Market
- Recognition of Innovation in FemTech
Funding Africa's Women-led Innovation
The 2021 investment cycle saw African startups break records by attracting over USD 4 billion in funding, more than double the investment haul of 2020. This has increased investments in women-led startups seven-fold over the last three years from USD 52 million in 2019 to USD 288 million by the end of 2021. The growth is hopeful; however, most of the funds were directed at companies in the information, communication and technology (ICT) sector where a majority of female-owned startups do not operate. Women-founded tech startups in Africa raised USD 100 million, but only 11 African women-led startups reached the milestone of securing over USD 1 million in a single round of funding. To name a few, Nigerian startup Okra raised USD 3.5 million to expand its data infrastructure and Klasha raised USD 2.4 million to improve cross-border commerce in Africa. With Kenya’s Lami raising USD 1.8 million to scale an Application Programming Interface (API) insurance platform across the continent. There is hope as women-owned and led startups are likely to continue seeing a significant increase in funding as investments into startups on the continent are expected to double in the following year.
Africa's Energy Transition - Growing Gas Market
Closing remarks from Frost & Sullivan's Energy Think Tank echoed the interesting energy transition period Africa is in. The continent is not only seeing increased investments in renewables and transition resources but is also experiencing a change in the type of companies in the energy market. Per the conversation with speakers Hendrik Malan, Patrick Prestele, Berrie de Jager - Renewable Energy. Mining. Fuel Services. Logistics and Derek Boulware Africa’s gas market is experiencing growth, with gas being seen as a cleaner transition resource to help meet baseload requirements during this period in local and eastern European markets. However, current outputs from the continent exported to Europe are still below the region's overall potential. Furthermore, the region faces challenges with several major international companies pulling out of infrastructure projects. Although this is a crucial challenge, this poses a new investment opportunity leaf for Africa, Derek pointed out. Several African countries are exploring more innovative financing models to drive infrastructure development for the local gas market, including policy plans, public-private participation (PPPs), equity funds, independently owned assets etc. Moreover, this opens the door to local investors. South Africa, Nigeria, Namibia, Angola, Kenya, Senegal, Mozambique and several others were among the investment destinations highlighted in the short and medium-term for high-potential projects, with Mozambique expected to have the highest output. According to work done by Welligence Energy Analytics alone, Africa has more than 101 commercial oil and gas assets that could be transactable, with many of these being early life assets. Some key stakeholders involved in the region include Eni, TotalEnergies, Invictus Energy Limited etc., but the door remains open for several more players to come in. The upcoming years pose several growth opportunities for the region but will require collaboration.
The whole conversation can be accessed HERE.
Recognition of Innovation in FemTech
In South Africa, August represents the celebration of Women’s Month, which acknowledges the Women’s Movement against the apartheid regime. This August, The Africa Women Innovation and Entrepreneurship Forum (AWIEF) has announced the finalists for the 2022 awards, including Zoie Health Technologies, a South African FemTech company founded by two women. Zoie Health, a digital clinic, is geared towards making female health care accessible and affordable, while simultaneously serving as a platform for people to find common ground and share their concerns. One of the main services offered by Zoie Health is the bespoke contraceptive consultation, which allows for prescription and delivery – offering millions the option to be educated on the best contraception for their bodies as well as receive the necessary prescription. There is tremendous value in this offering, as the UN estimates the total fertility rate of sub-Saharan Africa to be more than twice the level of any other region of the world. As such, this may be an easy and affordable way for people to avoid unwanted pregnancies. In addition, contraception serves as healthcare for those suffering from Polycystic Ovarian Syndrome and may reduce the risk of some cancers. This innovation is a space of major opportunity in South Africa, evidenced by Uteroo, another South African FemTech start-up that functions as a menstrual tracker and period prediction app. The use of such services has increased by 180,000 users in the past 5 years alone and is projected to increase further to 290 000 in 2027, with a compound annual growth rate of 17%, indicating the major room for growth in this sector.
To find out more about opportunities in Africa, please contact Lynne Martin.
