Startup Stats

3 Reasons to Invest in Africa-based Start-ups

The African continent has the youngest population in the world, making it one of the most compelling reasons to invest in Africa-based start-ups.

African youth are today’s as well as future leaders, and African start-ups are brimming with young founders whose innovative and fresh solutions are daily transforming the continent for good. Or sometimes disruptive it for the better too.

Another positive of an agile population is the vibrant labour that accompanies it. Young people tend to be active and have the energy and, often, the will to put in the work, whether it is physically or intellectually. Thus, encouraging industrialization; a shift which Africa needs considering its unique social and economic issues.

Read also: Why Start-ups are Important in Africa

While the advantage of youth tilts heavily in Africa’s favour, there are other reasons to invest in Africa-based start-ups.

As it applies to other continents, Africa’s start-ups are created at every turn, in every corner of its large expanse. They are of every kind and in just about any industry contributing to the global statistic that a start-up is launched every three seconds. Investors, angels and venture capitalists, can find the type of start-up which attracts them and their funds. Investors are spoilt for choice. From healthcare to food services, technology to fitness, transportation to consulting, founders tackle Africa’s big and little issues through innovative ideas, giving individuals and institutions reasons to invest in Africa-based start-ups.

Another attractive feature of African start-ups is the fact that the continent has a huge room for growth. Many of its sectors appear to be underserved i.e the fintech industry. This probably explains why the industry has been the most funded for the last three to five years in a row. Its huge growth potential boasts young minds with an affinity for technology. Few things spell success and growth like the combination of a vibrant labour force and technology. Like the diversity of its start-ups, African start-ups offer great opportunities for investors.

Finally, on the reasons to invest in Africa-based start-ups, the venture capital markets on the continent are unlike its contemporaries North America and Europe. Where the aforementioned markets are saturated, Africa does not share the same position, giving investors on its turf an attractive advantage.

Read also: 4 Strengths Common to African Start-ups

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