Connect with us

General News

Kenya Among Top Destinations in Africa Attracting Venture Capital

Published

6 years ago

on

[ad_1]

Kenya is among the top African countries that attracted the highest share of financing for start-ups and small businesses with exceptional growth prospects in the past five years (2014-2019), the African Private Equity and Venture Capital Association Ltd (AVCA) said in this month’s report.

South Africa had the most venture capital (VC) deals with 21 per cent of the total early-stage investments, Kenya got 18 per cent and Nigeria 14 per cent.

Venture capital is a form of private equity and a type of financing that investors provide to start-up companies and small businesses that show long-term growth potential.

The financing usually comes from well-off investors, investment banks and other financial institutions and can be provided in technical or managerial expertise.

According to the report, as a region, southern Africa attracted the highest number of VC deals (25 per cent) in Africa during the period under review, followed by East Africa (23 per cent) and West Africa (21 per cent).

By value, deals in consumer discretionary (28 per cent), financials (23 per cent) and industrials (18 per cent) attracted the largest share. The utilities sector was popular among early stage deals, with investors supporting companies that provide alternative power solutions.

Financial technology (fintech) firms dominate the African start-up scene, but afro-entrepreneurship has also grown within the utilities, logistics, transportation, e-commerce, healthcare and agribusiness sectors.