To put it simply, 2021 was a boom year for the African tech ecosystem.
In the early stages of the pandemic, investors projected deal activity would drop as economic activity ground to a halt. Some prominent firms, like Sequoia Capital, warned of armageddon, while others predicted a “Great Unwinding”.
Admittedly, many companies and startups trimmed their workforces, as they expected an economic bloodbath. But within months, we were in the middle of a global boom as investments and acquisitions forged ahead on the continent. We saw Network International buy East African payments startup DPO for $288 million, WorldRemit acquired remittance company Sendwave for $500 million, and Stripe acquired Nigerian payment gateway startup Paystack for $200 million.
Globally, venture capital funding consistently surpassed $100 billion in every single quarter this year, climaxing at a record $160 billion in Q3, according to Crunchbase data.
Venture capital has been one of the best performing asset classes globally over the past three years, and it has performed on par with the private equity and public markets over the last decade.
There is a sense that companies receiving venture investments are increasingly overvalued as newer deep-pocketed investors have entered the market, which in turn is creating the conditions that could cause a market bubble.
A far cry from the doomsday many were