Top Unicorns in Africa

There are plenty of factors that make some countries more conducive to starting and running successful businesses than others.

From a stable economy and supportive government to a high standard of living and a large pool of qualified potential employees, startups are affected by a range of different influences that can both help and hinder progress.

The African continent is known for its fairly small national economies, as well as a general lack of capital and relatively unreliable and unstable political situations from one country to the next. These are just a few issues that contribute to the difficulties faced by African entrepreneurs.

 

Why Are There So Few African Unicorns? 

 

Businesses vary in many ways, in terms of their respective industries, investment, country of registration and so much more, but unfortunately, one thing that is consistent across the board is that it is incredibly difficult for Africa companies to survive and even more difficult for them to become unicorns.

To achieve unicorn status – a valuation of over $1 billion for a privately owned enterprise – is no easy feat for any company, but it’s certainly easier if the startup is based in a country that is conducive to business establishment and growth.

For instance, the fact that the United States of America is home to nearly half of the world’s unicorns is due to more than just a few creative business owners who happened to be born in North America. Rather, among other things, the country attracts investment and national regulations are fairly relaxed for starting businesses, so entrepreneurs are in the ideal situation to do well.

Just like American-based companies have been dealt a good hand, African startups have been dealt a comparatively bad hand (generally speaking), and here’s why:

 

• Political Instability
• Lack of Capital
• Inaccurate Market Research
• Unfavourable Government Policies
• Corrupt Governments
• Poor Marketing
• Small/Relatively Unskilled Employee Pools
• No Ready Market
• Investment Hesitancy

 

These are the most general issues that many African countries face in the world of startups, and while they may differ in degree from one nation to the next, these issues form very significant obstacles for entrepreneurial growth and success.

 

African Unicorns to Keep An Eye On

 

The good news, however, is that it’s not all doom and gloom. While things may be tough for African-based startups, there are still many determined and ambitious entrepreneurs who are pushing the boundaries, and some of them are achieving great success.

In fact, Nigerian startup Jumia became the first-ever African unicorn in 2019, and although they fell off the list within a few months, the achievement still changed the game for African entrepreneurs and businesses.

Since, then, more than ten different companies have made the list, although some of them filled Jumia in dropping below $1 billion not long after. However, high-valued African startups are trending upwards, demonstrating a great deal of potential for entrepreneurs on the continent with big dreams.

Here are the most recent African companies to have achieved unicorn status.

 

1. Promisador

 

 

• Founded: 1997
• Value: $1.5 Billion
• Country: South Africa
• Industry: Food and Beverage

 

Promisador, formerly known as Wonder Foods Nigeria, is a food and beverage company started in 1997 that is now worth a whopping $1.5 billion.

Based in Johannesburg, South Africa, Promisador sells a range of food products, including milk and cereal as well as snacks and culinary enhancers.

Today, it supplies food products to consumers in more than 30 different countries and has raised a total of $532 million in funding over three investment rounds.

 

 

2. Interswitch

 

 

• Founded: 2002
• Value: $1 Billion
• Country: Nigeria
• Industry: Financial Technology

 

Interswitch is a financial software company that was founded in 2002 in Lagos, Nigeria. Intended for use by banks, governments and other institutions, it develops digital payment and transaction processing services to facilitate the electronic circulation of money.

The idea behind Interswitch, aside from the obvious, is to help clients improve operational efficiency, reduce operational costs and improve revenue growth that can be sustainable.

Interswitch achieved unicorn status in 2019 after receiving investment from Visa, the American payments company, as well as rewarding them with minority equity.

 

3. Flutterwave

 

 

• Founded: 2016
• Value: $3 Billion
• Country: Nigeria
• Industry: Financial Technology

 

While the company now has headquarters in both Lagos and San Francisco, Flutterwave was founded in Nigeria by Iyinoluwa Aboyeji, Olugbenga Agboola and Adeleke Adekoya in 2016.

Flutterwave has developed an advanced platform providing cloud-based end-to-end digital financial services in an attempt to simplify the options for payment infrastructure. The platform offers all different sides of payment processing, allowing for both local and international payments to be made securely.

The company was most recently valued at $3 billion in 2022, having attracted a total of $509.5 million of investment in a six-year period.

 

4. Esusu Inc. 

 

 

• Founded: 2018
• Value: $1 Billion
• Country: Lagos, Nigeria
• Industry: Financial Technology and Property Management

 

Esusu is another fin tech startup that was founded in Lagos, Nigeria. The company developed a financial platform to offer consumers credit-building services by means of rent payment reporting.

The platform is able to capture information on rental payment data in order to report it to the relevant authorities, which can help clients boost their credit scores, attract new tenants and more.

Esusu was founded by Wemimo Abbey and Samir Goel, and over its five years of existence, the business has attracted more than $145 million of investment.

 

5. MNT Halan

 

 

• Founded: 2018
• Value: $1 Billion
• Country: Egypt
• Industry: Financial Technology

 

MNT-Halan was founded by Mounir Nakhla, Ahmed Mohsen and Ziad Abaza in Cairo in 2018, and was most recently valued at $1 billion in 2023 after receiving $400 million of investment.

The company provides consumers with financial servers that are specifically designed for use by retail and commercial clients. There services it provides include business ending (both small and micro businesses), payments, e-commerce, consumer finance and more.

MNT-Halan is facilitating the digitisation of banking services, making financial processes more accessible and secure.

 

6. Andela

 

 

• Founded: 2014
• Value: $1.5 Billion
• Country: Nigeria
• Industry: Human Capital Sources

 

Andela was initially founded in Nigeria in 2014 before being launched in Kenya not long after. The company’s founders include Nadayar Enegesi, Iyinoluwa Aboyeji, Brice Nkengsa, Jeremy Johnson, Christina Sass and Ian Carnevale.

Aiming to match businesses with employees, Andela is a global talent network that helps highly skilled, remote engineers find work within their field. The platform is incredibly helpful to both employers and employees, providing services including sourcing, assessments and matching candidates to jobs, to make the hiring/job search process not only more efficient and effective but less painful too.

Just over seven years after its establishment, Andela was officially dubbed one of Africa’s few unicorns, receiving a valuation of $1.5 billion in 2021.

 

What Does the Future Hold for African Startups?

 

Who knows exactly what the future holds for startups in Africa, but one thing we do know is that young business’s success rates seem to be improving. Not only are there more startups than ever, but there are also more privately owned businesses being included on lists of unicorns which is a great representation of progress.

Just like with anything, it’s going to take time for Africa’s economic landscape to become properly conducive to producing multi-billion dollar companies. And, it’s possible that as this improves, they’ll probably mostly be from the same country or in the same industry, much like how most of today’s unicorns are Nigerian startups operating in fin tech.

Regardless, it does seem like instances of successful startups being established on the African continent are becoming more common, so the next decade should be exciting as we (hopefully) watch more privately owned African startups achieve billion-dollar valuations.