Mergers and acquisitions among African startups climbed to a record 67 deals in 2025, representing a 72% increase from 2024, according to TechCabal Insights’ “The State of Tech in Africa 2025” report, published on Friday, Jan. 23, 2026.
The total comfortably surpassed the previous high of 40 deals recorded in 2022, pointing to a clear shift in Africa’s tech ecosystem away from fragmentation and toward strategic consolidation.
The report explains that as investors focus their capital on a smaller group of more mature startups, younger companies facing fundraising challenges are increasingly opting to merge or be acquired by better-capitalized firms.
At the same time, established startups are pursuing acquisitions more aggressively to expand into new markets, obtain operating licences, and strengthen their market positions.
Several notable transactions took place during the year. Kenyan foodtech company Twiga Foods acquired three distributors, Raisons, Sojpar, and Jumra, to reinforce its supply chain.
Nigerian fintech Moniepoint expanded regionally through the acquisition of Kenya’s Sumac Microfinance Bank and the UK-based electronic money institution Bancom Europe.
Another Nigerian company, Rank, formerly known as Moni, acquired AjoMoney, a platform offering collective savings, credit, and investment services, as well as Zazzau Microfinance Bank. In South Africa, a payment infrastructure specialist acquired competitors ExiPay and Efficacy Payments.
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Fintech dominated deal activity by sector, accounting for 31 mergers and acquisitions during the year, as seen on Ecofin Agency. E-commerce followed with eight deals, while healthcare recorded six.
Transport and logistics also saw six deals, as did telecoms, media, and entertainment. Deeptech accounted for four deals, and climate tech recorded three.
Geographically, deal activity was heavily concentrated in Africa’s four largest tech ecosystems, which together accounted for nearly 75% of all mergers and acquisitions.
South Africa led with 16 deals, followed by Kenya with 14, Egypt with 11, and Nigeria with nine. Despite this concentration by sector and country, the report notes that the consolidation wave is reshaping the broader tech landscape.
This trend is occurring alongside more than 70 strategic partnerships and 54 geographic expansion initiatives involving entry into one or more new markets within or outside the continent, highlighting how African startups are increasingly pursuing growth through ownership ties, collaborations, and market access.
This transition toward a more mature ecosystem has come with significant costs. Since 2020, an estimated 8,589 layoffs have been recorded across Africa’s tech sector, including 2,421 in 2025 alone, which represents 28% of the total.
These job cuts reflect efforts by companies to streamline operations and improve efficiency. In addition, the end of the “growth at all costs” era led to the closure of 46 startups between 2022 and 2025, with 18 shutting down in the past year alone.
On the funding side, the report states that African startups raised $3.42 billion across 502 transactions with disclosed amounts in 2025, up from $2.24 billion in 2024.
Of this total, $2.297 billion came from equity financing, $1.083 billion from debt, and $40 million from grants. Fintech startups attracted about 40% of the total funding, raising $1.37 billion.
They were followed by energy and water companies with $857 million, logistics and transport with $398 million, healthcare with $185 million, services with $115 million, agriculture and food with $89 million, education and employment with $87 million, deeptech with $73 million, and retail with $71 million.
By country, the continent’s “Big Four” tech hubs accounted for roughly 80% of total funding raised. South Africa led with $933 million, followed by Kenya with $811 million, Egypt with $548 million, and Nigeria with $438 million.
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Image Credit: Nairametrics
