Africa’s swift adoption of new technologies is making it one of the world’s fastest-growing tech hubs. 

Venture capitalists spent a record $1.3 billion in the continent last year, more than six-fold from five years ago, WeeTracker’s annual funding report shows. 

African startups also broke fundraising records, registering ever higher capital amounts. Nineteen startups raised more than $10 million last year, almost double the 10 that achieved the same in 2018. Even so, the median amount raised was little changed at $1 million, according to PitchBook data.

 Investors are betting that Africa will be a gold mine for fintech because about 62% of sub-Saharan Africans didn’t have a bank account as of 2017, the most recent data from the World Bank Global Findex. The continent’s fast-growing Internet usage also presents opportunities for digital-only banks.

Fintech startups in Africa raked in a total $678 million in 2019, more than double a year earlier, while the cleantech sector raised $145 million and healthtech got $75 million last year, according to the WeeTracker report. 

Nigeria emerged as the hottest tech-hub in Africa. Not only did Nigerian companies raise $663 million last year, the most of all African countries, Lagos-based Co-Creation Hub acquired Nairobi’s iHub in October, creating a mega-incubator focused on areas including smart infrastructure, fintech and education. 

  • Global financial services companies are eager to incorporate the largely unbanked population. Card giant Visa led mobile finance company Branch’s $170 million series C funding in April, offering unbanked customers prepaid debit cards. Nigeria-based payment unicorn Interswitch was reported to have sold Visa 20% of its stake for $200 million in November, doubling down its effort to improve financial inclusion. 
  • Chinese investors are also increasing their bets on the burgeoning fintech scene. Nigeria’s OPay scored $120 million in series B including Meituan Dianping, Sequoia China and IDG Capital in November. A week later, Shenzhen-based Transsion Holdings invested $40 million in PalmPay, another Lagos-based payment startup. 
  • Transportation also performed well in venture capital fundraising. Cario-based Swvl raised $42 million series C in June led by BECO Capital and Vostok New Ventures, offering Egyptians ride sharing public transportation. Electric vehicle company Kiira Motors from Uganda and Lagos-based digital logistic provider Kobo received $40 million and $30 million, respectively, in early stage VC investments last year.