Kenyan startups secure Sh82.5 billion, leading Africa in funding
This amount represented 29% of the total startup funding raised across the continent, putting Kenya ahead of major players like Nigeria, Egypt, and South Africa.
Kenya secured Sh82.5 billion in startup investments in 2024, solidifying its position as the leading hub for venture capital in Africa, according to the newly published Kenya Innovation Outlook 2024 report.
This amount represented 29% of the total startup funding raised across the continent, putting Kenya ahead of major players like Nigeria, Egypt, and South Africa.
While the record-breaking funding highlights Kenya’s rising status as a regional hub for technology and innovation, experts have raised concerns over the country’s heavy reliance on foreign capital, warning that it could undermine long-term stability and resilience.
The Kenya Innovation Outlook 2024 report reveals that 81% of the funding came from international investors, pointing to a structural imbalance in the startup ecosystem.
Speaking at the report’s launch on June 8, 2025, Tonny Omwansa, CEO of the Kenya National Innovation Agency (KeNIA), described the report as both "a mirror and a map," reflecting the ecosystem’s growing maturity while offering direction toward building a more inclusive and globally competitive innovation economy.
However, Omwansa cautioned that although the influx of foreign capital is fueling growth, it also brings vulnerabilities.
He noted that many international investors come with short-term goals and exit strategies that may not align with Kenya’s long-term economic interests.
The report further warns that Kenya’s dependence on overseas funding leaves startups exposed to external economic shocks and fluctuations in global investor confidence.
A lack of strong local capital markets and domestic investment options has also contributed to an ecosystem that leans heavily on foreign support, limiting the emergence of a resilient, homegrown financial infrastructure.
Much of the 2024 funding surge,
In East Africa, startup funding totaled Sh93.8 billion, with Kenya contributing 88% of that sum.
However, this dominance underscores a significant concentration in Nairobi, where over 75% of business development service providers are based.
This centralization continues to sideline startups outside the capital, slowing efforts to decentralize innovation across the country.
"This outlook confirms that ecosystems thrive when they are collaborative, decentralized, and inclusive," said Ian Lorenzen, Executive Director of Growth Africa.
The report calls for a more balanced national innovation infrastructure to foster equitable growth and unlock entrepreneurial potential nationwide.
Gender disparities in funding persist, with women-led startups receiving only 12% of total investments.
This highlights ongoing challenges in accessing capital, mentorship, and market opportunities.
These low figures reflect deep-rooted barriers that hinder female entrepreneurs from scaling and competing effectively, despite public and private initiatives aimed at promoting inclusion.
Policy uncertainties also complicate Kenya’s innovation landscape.
The Startup Bill, intended to provide a formal regulatory framework for startups, remains stalled in parliament.
Without clear legal and policy direction, entrepreneurs operate in a fragmented environment that deters sustained local investment.
