Kenya has emerged as the top tech funding destination in Africa for the second consecutive year, surpassing Nigeria and other major tech hubs on the continent. According to a recent report, Kenya received the largest total annual funding in 2024, with a total of $638 million, cementing its position as a hub for tech innovation and investment in Africa.

This development marks a significant shift in investor confidence, as Nigeria had long been considered the top tech innovation hub in Africa. However, Kenya's tech ecosystem has been gaining momentum in recent years, with the country receiving $420 million in 2021, $1.1 billion in 2022, and $800 million in 2023. This steady growth has apparently won over foreign investors, who are now placing more trust in Kenya's tech ecosystem.

The report by Africa: The Big Deal reveals that African startups raised a total of $2.2 billion in equity, loans, and grants in 2024, a 25% decrease from the $2.9 billion raised in 2023. Despite this decline, the "Big Four" countries - South Africa, Kenya, Nigeria, and Egypt - still drew 84% of all startup investment in Africa in 2024, amounting to $1.8 billion.

Kenya's achievement is all the more impressive considering that Nigeria's Moniepoint and South Africa's Tyme raised the two largest funding rounds at $110 million Series C and $205 million Series D, respectively. However, Kenya's tech ecosystem has been able to attract a larger total amount of funding, indicating a more diverse and robust startup landscape.

The regional breakdown of funding reveals that East Africa attracted the most funding for the second year in a row, with a total of $725 million, accounting for 1 in 3 dollars raised on the continent in 2024. Kenya alone made up 88% of the total raised in the region, and 29% of all the money raised on the continent. Western Africa came in second, with $587 million, followed by Northern Africa with $478 million, and Southern Africa with $397 million.

The report also highlights the decline in funding in Northern Africa, which fell by 35% between 2023 and 2024, largely due to a 37% year-over-year contraction in funding in Egypt. Southern Africa also suffered a similar drop in funding, with a 36% year-over-year decline.

This shift in investor confidence towards Kenya's tech ecosystem is likely to have significant implications for the country's economic growth and development. As Kenya continues to attract more funding and investment, it is likely to create more jobs, stimulate innovation, and drive economic growth in the region.

The story is a testament to Kenya's commitment to creating a conducive environment for tech startups to thrive. The country's government has been actively promoting the growth of the tech industry through initiatives such as the Kenya ICT Masterplan, which aims to create a vibrant tech ecosystem that can drive economic growth and development.

As the African tech landscape continues to evolve, it will be interesting to see how Kenya's tech ecosystem develops in the coming years. With its current momentum, Kenya is well-positioned to maintain its lead as the top tech funding destination in Africa, and potentially become a hub for tech innovation and investment in the global economy.