African Fintech Startups Still Face Major Funding Gaps
The number of early-stage deals among African fintech startups is increasing, but the average size of the deals remains low compared to that of other regions, and funding gaps persist at the early stages, according to a new report on the industry in emerging markets. Creative funding solutions may go some way to overcoming these obstacles, it says.
While the average amount for African startup seed rounds is $1.5 million, those of India and Latin America are around $4.6 million and $5.7 million respectively, says the report by Briter Bridges, a data-driven research firm, and Catalyst Fund, a global tech accelerator. Seed rounds refer to initial investments in a new company, often by so-called “angel investors,” usually in exchange for partial ownership or equity. They help to grow the business by funding research, a team, and product development for example.