TLDR:
- The ICT sector in Southern Africa comes out on top in the latest Venture Capital Industry Survey
- Challenges like a low-growth economy and high unemployment have impacted start-ups in the region
The 2023 Venture Capital Industry Survey highlighted the struggles faced by start-ups in Southern Africa due to the economic environment and ongoing energy crisis. Despite challenges, the ICT sector has continued to attract investor interest and confidence, leading in terms of number of deals and portfolio allocation. The survey, conducted by The Southern African Venture Capital and Private Equity Association (SAVCA), indicated a 14.5% decrease in the value of VC deals in 2022.
Key findings from the survey revealed that the ICT sector held the largest allocation by number of active deals in portfolios at the end of 2022. Within the ICT category, sub-sectors like FinTech, Software, and AgriTech showed significant growth. The survey also highlighted the importance of investment sectors like education technologies (ICT EdTech) in the region.
Industry experts at the survey launch event emphasized the need for a dual focus on return-on-investment and impact, stressing the importance of investing in homegrown businesses to address societal challenges. The survey results showed promising prospects for early-stage investments in the coming year, with a focus on new deals and follow-on funding in existing portfolios.
Overall, the ICT sector’s innovation and efficiency have positioned South Africa as a global player, attracting investments and fostering international collaboration. The SAVCA VC Industry Survey conference discussed the future of the sector in Southern Africa, bringing together stakeholders to share ideas and insights on driving growth and impact.
