10 African Tech Firms That Could Be Future Unicorns

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Written by Peter Pedroncelli
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African startup Jumia’s successful initial public offering in New York has put a spotlight on other African tech firms, raising the question, which one will be the next tech unicorn?

Jumia‘s listing confirmed it as Africa’s first tech unicorn, as predicted in 2016. The company had a valuation of around $1 billion at IPO, before jumping more than 200 percent per share in the initial few days.

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These valuations do not always reflect reality. Globally, a dozen unicorns that have listed publicly, or are likely to do so, posted combined losses of $14 billion in 2018.

A look back at earlier unicorn predictions shows that some have fallen short. Jumia was accurately predicted three years ago.

Here are 10 African tech firms that could be future unicorns.

Branch International

Kenyan online lender Branch International, which was founded in Kenya but is now based in Silicon Valley, raised $170 million in April this year following a $20 million funding round in 2018, according to Quartz. The firm’s excellent financial performance and consistent expansion into other markets, including growth into Brazil and Indonesia thanks to a partnership with Visa, makes the company a viable candidate to be a future African tech unicorn.

Interswitch

Nigerian integrated digital payments and commerce firm Interswitch is a fintech firm with great growth potential. The firm recognizes the need for effective payment services across Africa, and has developed a multi-channel payment network to serve that need. It appears poised to list on the London Stock Exchange before the end of 2019, with some investors believing it to be worth over $1 billion already, Techcrunch reports. Interswitch has been busy with acquisitions over the last five years, acquiring Paynet in 2014 and Vanso in 2016, according to Crunchbase.

M-Kopa

Kenyan solar energy company M-Kopa is another contender for the tech unicorn prize from Africa, having experienced consistent growth in users and across markets. It secured a round of funding in March 2018, and while it was undisclosed, it included a first ever $10 million investment from FinDev Canada. A big player in East Africa, M-Kopa has raised $161.8 million over 11 funding rounds, Crunchbase reports.

Jumo

South African fintech platform Jumo, the financial services platform for emerging markets, has the potential to keep growing into a tech unicorn in years to come. It concluded a $64.5 million funding round in 2018 led by U.S.-based investment bank Goldman Sachs, according to the company. That was the biggest tech startup funding deal of the year, with the investment dedicated towards accelerating expansion into additional Asian and African markets, according to ITWebAfrica.

Andela

Andela has been a contender for this particular achievement for quite some time, and a massive investment at the beginning of 2019 pushed the company even closer to that milestone. In January, the Nigerian tech startup that outsources African tech talent secured a $100 million funding round, bringing the firm’s venture capital funding to date to $180 million, Bloomberg reported. The latest investment has valued the company at somewhere between $600 million and $700 million, according to Tekedia.

future unicorns
African coders who have completed their fellowship through Andela. Photo – Andela

Cellulant

Cellulant, a digital payments solution firm based in Kenya began its funding journey in 2011 with a $1.5 million round, before a further $5.5 million Series B investment in 2014, according to Crunchbase. Those amounts pale in comparison with a 2018 Series C funding round raised by the fintech firm. The company raised $47.5 million in May 2018 led by The Rise Fund, an impact investment fund run by U.S.-based private equity group, TPG Growth, according to Quartz.

Wakanow

Lagos-based online travel company Wakanow secured a $40-million equity investment from U.S. asset manager The Carlyle Group‘s sub-Saharan African fund in 2018. That investment immediately put the startup on the African tech map. Wakanow was launched in 2008 by CEO and former NBA basketball player Obinna Ekezie, and has since grown to establish operations in Ghana, Kenya, Nigeria, the U.A.E. and the U.K., according to Ventureburn.

Peg Africa

The only Ghana-based firm on this list, pay-as-you-go solar company Peg Africa raised a $25 million Series C funding round in March, bringing its total funding to date to $47.5 million, according to a press release. The growing numbers behind the company certainly make it one to watch. The solar firm serves 60,000-plus households and more than 300,000 users, through 70 service centers, employing 400 full time staff and 550 commission-based sales agents, according to Forbes.

Paga

Nigerian mobile payments company Paga may also be in with a chance of joining the elite club of future unicorns in tech. The company has raised $34.7 million over four rounds since 2010, with the most recent being a September 2018 Series B investment amounting to $10 million, according to Crunchbase. In addition, CEO Tayo Oviosu has discussed the possibility of an IPO for his company, though he believes that they will remain private for the next two to four years, according to Techcrunch.

GetSmarter

South African edtech startup GetSmarter, founded by brothers Sam and Rob Paddock, is another firm with unicorn potential. The company develops online short courses in partnership with higher education institutions, including Cambridge University, Harvard University, and the Massachusetts Institute of Technology. In 2017, Nasdaq-listed edtech firm 2U acquired GetSmarter for $103 million, according to Forbes. Belonging under the U2 umbrella could give the SA edtech startup the growth potential needed to consistently improve its valuation.