Building Africa's startup ecosystem requires grit, trust and corporate courage

THE stories of startups in Silicon Valley often start in garages with founders backed by easy access to capital and forgiving safety nets. In Africa, the reality is very different.

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Entrepreneurs on the continent aren't innovating from the top of Maslow’s hierarchy, but at the base, solving urgent, everyday challenges where failure can mean families go hungry. That makes African founders some of the most resilient in the world, but the capital environment rarely matches their ingenuity.

Over the past year, African startups have maintained growth and adaptability despite a global downturn in venture capital and economic challenges. According to the International Finance Corporation (IFC), African tech startups are still growing and adapting even with a 52% drop in capital between 2022 and 2024. Importantly, there were only 22 exits in 2024 compared with 20 in 2023 which reflects a growing market maturity. Founders are thriving despite a challenging ecosystem of limited funding and complex operating conditions and their success comes down to two things ~ grit and tenacity.

Startups that persist despite facing a market that has fewer opportunities, unfavourable market conditions and scarcity of funding stay focused on their vision and are determined to succeed with or without support.

And yet, support is critical. Increased funding and active investment are vital to ensuring startups remain innovative and geographically diverse.

The IFC has found that when startups have access to venture capital and wider financial support, they can digitise informal businesses, expand their services and increase their competitiveness, especially for microbusinesses.

As venture capital remains shallow across the continent and external investors are cautious, this is where corporate balance sheets and capabilities can change the narrative.