Venture funding into African startups slowed sharply in August 2025, with companies across the continent raising $93 million, making it the second weakest month this year after March. The figure marks an 83% decline from July’s $550 million but represents a 66% increase compared with the $56 million raised in August 2024.
Despite the steep month-on-month fall, analysts noted one bright spot: equity funding strengthened. Roughly three-quarters of the $93 million secured in August came through equity, reversing July’s heavy reliance on debt, which accounted for nearly 90% of funding that month. Since January, debt has comprised 45% of total startup financing, up from 28.5% by midyear and higher than the 33% recorded by this time in 2024.
In its monthly commentary, Africa the Big Deal said, “August was a relatively quiet month on the fundraising front for start-ups in Africa, especially if we compare it to July, which was extraordinarily busy. In fact, it is the second-most quiet month this year so far, after March. But this is not really a cause for concern, the amount raised is still higher than what was raised in August last year, and the number of startups who raised is comparable to the same month in 2024 and 2023. Plus, the 2025 numbers to date continue to look strong.”
Deals and Sector Breakdown
Thirty-three startups raised at least $100,000 in August. Nigeria’s Koolboks, which manufactures solar-powered cooling solutions, led the month with an $11 million Series A round combining equity, debt, and grant financing. The round included equity participation from KawiSafi Ventures, Aruwa Capital, and All On, debt from FFEM and bpifrance, and grants from organizations such as Innovate UK, CEI Africa, and the Shell Foundation. The funding will support Koolboks’ assembly plant in Nigeria and expand its distribution footprint.
Kenya’s Hewatele followed with a $10.5 million investment from AfricInvest’s Transform Health Fund to build a new liquid oxygen facility, aimed at improving access to medical oxygen in hospitals. Egypt’s Breadfast raised $10 million in a Series B round led by Novastar Ventures with support from the European Bank for Reconstruction and Development to expand fulfilment centres and scale its payments platform.
Nigeria’s Chowdeck also closed $9 million in Series A funding backed by Novastar Ventures, Y Combinator, and angel investors including Paystack co-founders Shola Akinlade and Ezra Olubi, while Egyptian fintech valU raised $9 million via securitised bond issuance.
Together, startups in Nigeria, Egypt, and Kenya, the so-called “Big Four” markets, accounted for about 75% of all funding activity in August.
Outlook for 2025
So far this year, African startups have raised more than $2 billion, with equity contributing about half. At the current pace, 2025 is on track to surpass 2024 and potentially mark the first year of growth after two consecutive annual declines in venture investment.
While the August slowdown highlights the volatility of monthly flows, the rebound in equity suggests investor appetite for longer-term exposure remains intact. The coming months will be critical in determining whether the continent can break the $3 billion mark this year and sustain momentum amid shifting global capital markets.
