NextBillion - A WDI Publication

Africa’s tech sector has been thriving for almost three decades, during which its entrepreneurs quietly built a self-sustaining ecosystem. This ecosystem matters because market-creating innovations drive long-term economic development. Supportive ecosystems help innovators reduce costs, access mentors, funders, strategic partners and other resources, and empower commerce that nurtures both emerging and developed economies.

Africans have led their own support system development, ensuring it uniquely suits their needs. For instance, most African consumers lacked bank and credit card access, creating major payment pain points. Local innovators and entrepreneurs prioritized solving these by leveraging mobile phone access.

By 2025, over $2 trillion flowed through mobile money wallets globally, and 74% of those transactions were African. Mobile money transfers created a new industry — Fintech 1.0.

Next, African startups like Flutterwave and Paystack created API tools, forcing traditional banks to compete with mobile-first fintechs. Such startups built venture successes that attracted fintech investments from around the world — Fintech 2.0. But who built and funded the tech infrastructure for Africa’s tech industry transactions?

Instead of government-backed and charitable institutions taking the lead, time and again it was Africa’s own diaspora who left the continent to learn, earn and return as entrepreneurial leaders. They have driven its tech infrastructure, innovation and commercial success.

The Impact of an African Tech Pioneer

One exemplary African tech infrastructure pioneer was Mo Ibrahim, a Sudanese-born engineer. Frustrated over British Telecommunications’ “bureaucratic lethargy,” Ibrahim founded his own design consultancy firm, Mobile Systems International (MSI). When he saw his MSI clients paying dearly for country licenses to build and operate mobile systems, he encouraged them to secure licenses that were readily available in African countries, like Uganda, where younger demographics promised higher adoption rates.

Because Ibrahim’s clients spurned his advice, he assembled his own stellar team within MSI to pilot his vision, dubbing it Celtel. As his team negotiated telecom licenses in Africa, they adhered to transparent governance policies to prevent corruption — a key concern of commercial and development sector partners. Their pre-paid air-time innovations sidestepped cashflow issues and became the foundation upon which the mobile money industry was built.

Still, lenders who routinely funded mobile industry infrastructure elsewhere were so leery of Africa that they either refused to engage, or they required so much collateral that they undermined progress. Instead of depending on such wary lenders, Ibrahim sold his U.K. design firm to fund Celtel’s growth.

By 2005, the company was successfully “bridging the digital divide” in 13 countries, with millions of subscribers, thousands of employees and hundreds of millions in USD revenues. Clearly, Celtel had achieved impressive results in both development and financial goals, yet funders remained skeptical about expanding their support.

“We had to do round after round of fundraising, usually for short-term funds, just to keep the business afloat. It got frustrating,” Ibrahim told the Harvard Business Review in 2012. “Financial institutions simply didn’t see Africa the way they saw, for example, India and other emerging market economies. They thought Africa was riskier as a market; they all but discounted the consumer populations as simply too poor to be good customers; and they didn’t trust local governments to support honest business growth.”

So Ibrahim and team explored a public listing to finance Celtel’s rapid growth, which prompted unsolicited offers to buy the entire company. In 2005, they accepted Kuwait-based Mobile Telecommunications Company (MTC’s) offer to buy six year-old Celtel International for $3.4 billion. This deal retained Celtel management for long enough to complete their mobile network rollouts across Africa without funding constraints.

As Ibrahim put it, “Ironically, the same banks that had insisted on our entire assets as collateral a few months before now agreed to finance that enormous transaction for MTC secured only — surprise, surprise — by those very assets. Despite all we had built, they considered an African company less valuable than a company in almost any other part of the world.”

After the Celtel exit, Ibrahim launched Satya Capital to help other African founders navigate these dangerous funding waters. His financing challenges inspired him to invest in other African entrepreneurs facing the same barriers his team had endured. When his former Celtel colleagues Moez Daya and Tsega Gebreyes finished their Celtel growth rollout, they left MTC and joined Satya Capital to help tech innovators build African economies. Their timing was perfect.

Africa’s Tech Ecosystem Emerges

When the U.S. financial services industry stalled out in 2008, it lost its luster for top-of-the-class African diaspora, so they began looking homeward — where some countries were reporting among the world’s highest economic growth rates. There, they saw emerging opportunities to build a more promising future for the continent’s youth.

Among them was Nigeria-born Funke Opeke, who left her telco executive office in New York to bring the broadband capacity to West Africa that empowered the youth whose innovations built some of Africa’s most successful fintech startups, including Flutterwave and Paystack. Their ingenious approaches resonated with Africa’s tech-savvy markets and international investors.

By 2024 African startups had emerged as sector leaders, founding payment platform ventures that sprinted past billion-dollar valuations, with asset-light burn rates much lower than infrastructure companies like Celtel. Since then, a host of African investors, like Satya Capital, have nurtured an army of young tech founders in a robust field where pan-African tech collaboration has taken root — supporting a home-grown ecosystem.

LoftyInc Allied Partners exemplifies this African-led ecosystem cycle. Its African-born partners co-founded Nigeria’s Wennovation Hub in 2010 and the Afropreneurs Angel Group in 2011, while most of them were still earning grad school degrees in the U.S. and U.K. They collaborated with African tech hub and business angel group founders, co-launching pan-African organizations that now represent hundreds of tech hubs and thousands of angel investors. LoftyInc’s portfolio companies gained global investor attention, which inspired me to partner with them to establish their Delaware-registered venture investing arm, LoftyInc Capital Management in 2017.

Hundreds of LoftyInc’s seasoned mentors matured into successful angel investors who invested in LoftyInc Capital’s seed stage venture capital funds as limited partners; their expertise enhances venture fund values and exits. LoftyInc’s private sector funds have not only created African jobs and prosperity, they have also returned top-tier profits.

Across the continent, another successful cycle has emerged, as African entrepreneurs, mentored by LoftyInc partners, have become seasoned angel investors, and some now manage their own seed funds, like Future Africa. They reinvest their profits into the next crop of venture teams, attracting new investors from an ever-widening network, which sustains their ecosystem.

An Ecosystem Built to Last

Will this ecosystem endure?

After Africa birthed its first billion-dollar ventures between 2019 and 2024, it suffered from the trifecta of COVID, the Nigerian government’s decision to allow the Naira’s value to float freely, and massive cuts in foreign development funding. Early global investors who stuck their toes in the water are watching closely, balancing potential risks against their fears of missing out. As they wonder whether to double down, local venture fund managers are now attracting African sovereign wealth and pension fund interest.

Three membership groups exemplify the scale of development impact this startup ecosystem has achieved:

• AfriLabs represents over 500 of Africa’s most robust tech innovation hubs, operating in 53 countries, supporting millions of aspiring entrepreneurs.
• The African Business Angel Network, ABAN, connects over 5,000 private investors and 75 angel groups in 37 African countries, along with the diaspora.
• The African Private Capital Association, AVCA, coordinates Africa-facing venture capital and private equity investors who collectively manage over US $1.5 trillion in assets.

These entities conduct independent industry research, advocacy and professional development programs. Their networking events create global opportunities to collaborate on training programs, strategic partnering and policy lobbying. Their African-led programs add value, reduce risks and build scale. They represent mostly local, U.S. and European interests, but Asian and Middle Eastern investors are gaining ground.

There’s no need to wonder whether this ecosystem can survive tough times and scale up: It already has. Its resilience reflects the massive, untapped growth potential in the startups that are driving African economic development, offering plenty of room for foreign funders who co-invest equitably, seeking mutual benefits that do not impede African leadership or economic development.

Marsha Wulff has pioneered African investing since 1997; she co-founded LoftyInc Capital Management in 2017 and authored African Ngenuity: An Investor’s Guide to a Vital Tech Ecosystem in 2025.

Photo credit: Tina Basson