TLDR:
- Africa faced challenges with startup exits due to regulatory scrutiny and reduced investment.
- Despite challenges, there have been significant acquisitions in the African tech ecosystem.
Startups globally have faced challenges with exiting over the past few years, with factors like a frozen IPO market and regulatory scrutiny affecting M&A deals, particularly involving Big Tech companies. In Africa, the number of M&A exits peaked in 2021 with 44 exits, attracting nearly $6 billion in venture capital. However, in 2022, the number of exits dropped to 29, alongside a decrease in venture capital investment to over $3 billion.
Local investors remain optimistic, stating that M&A activity will eventually pick up as founders and investors seek liquidity in a tough market. Expensya, a Tunis- and Paris-based expense management startup, stands as one of Africa’s landmark exit stories, with a cash-out of $10 million for its employees in an acquisition by Medius valued at 1.5 times its last reported valuation of $83 million.
Other notable acquisitions include InstaDeep, Sendwave, MainOne, DPO Group, Paystack, Fundamo, and PaySpace, demonstrating the potential for significant returns within Africa’s emerging tech ecosystem. These acquisitions highlight the progress and potential of the continent in delivering value through M&A activity.
As the African tech ecosystem continues to grow, the analysis of disclosed acquisitions becomes essential in understanding the continent’s performance and potential in the global tech landscape.
