In 2021, the global venture capital market contracted significantly, a trend that continued, severely affecting startup funding in Africa. Several industries saw business failures as a result. But the tide now seems to be turning.

African startups in agriculture and food technology (AgriFoodTech) raised $145 million in the first half of 2024, marking a 1.6% increase from the same period in 2023, despite a global slowdown in venture capital, according to a report published on October 17 by venture capital firm AgFunder. 

The Africa AgriFoodTech Investment Report 2024 suggests that this modest uptick signals a potential recovery in investment for startups transforming the continent's agriculture and food sectors. This follows a significant decline in 2023. Last year, funding plunged by 62% to $275 million after strong performances in 2022 and 2021, when investments reached $732 million and $531 million, respectively.

This year’s slight rise in funding from January to June came alongside a 27% year-on-year drop in deal volume, with only 39 transactions recorded. This points to investors’ increased caution, favoring more mature AgriFoodTech startups over early-stage ventures.

Investment distribution reveals a strong focus on a few key countries, with Kenya leading, securing $83 million across 19 deals—over half of all recorded funding. Egypt and Nigeria followed, raising $24 million and $15 million, respectively.

In terms of sector focus, fintech and marketplaces captured 41% of the total funding, while startups specializing in innovative agricultural equipment, such as robotics and mechanization, attracted 17.5%. Mid-value chain startups—focusing on food safety, traceability, logistics, transportation, and processing—received 15% of the funds raised in the first half of 2024.

The report also highlights that African AgriFoodTech companies have received a cumulative $2.4 billion in investment over the decade from 2014 to 2023. However, funding remains concentrated in key tech hubs. Kenya stands out as a “hotspot” for agro-innovation, leading the pack with $833 million in funding over the past decade, followed by South Africa ($511 million), Nigeria ($326 million), and Egypt ($310 million). Together, these four countries account for 88% of all AgriFoodTech startup funding on the continent.