Kenya has achieved its highest-ever position in the global startup ecosystem rankings, bolstered by a rapid growth rate of over 30 percent — the fastest among countries ranked between 51st and 61st globally. This impressive leap places the country firmly as Africa’s second most robust startup hub, just behind South Africa, while also strengthening its status as Eastern Africa’s top innovation centre.

The 2025 report, released by a global startup research body, highlights that Kenya’s ecosystem score is now six times higher than Uganda’s, its closest competitor in the region. The score reflects key indicators like startup funding, talent pool, government support, and market reach.

Two Kenyan cities were featured in the global top 1,000 startup cities. Nairobi, the capital and heart of Kenya’s tech sector, climbed six spots to rank 107th globally. Meanwhile, Mombasa, the coastal city, re-entered the list after a period of absence, posting an eye-catching 104 percent growth rate in ecosystem activity.

The report underlined Nairobi’s dominance in Eastern Africa, stating that Nairobi’s startup ecosystem is almost fifty times stronger than Mombasa’s, and five times more vibrant than Victoria in Seychelles. The city continues to attract regional and international venture capital, largely due to a strong fintech foundation and strategic partnerships with the public and private sectors.

“In Africa, Kenya is showing what’s possible when innovation, supportive policy, and partnerships align,” the report said. “Nairobi is inching closer to the global top 100 — a clear signal of long-term progress.”

Kenya’s ecosystem is now growing faster than Nigeria and Egypt, two traditional powerhouses of African innovation. Experts point to the growth of fintech platforms like M-Pesa, which continue to lead financial inclusion not just locally but across the continent.

Government-led initiatives have also been instrumental in the ecosystem’s rise. These include the Kenya National Innovation Agency’s (KeNIA) Innovation Bridge platform, which connects startups with funders, researchers, and collaborators, and the proposed National Innovation Master Plan, which sets the roadmap for building a globally competitive knowledge economy.

However, not all the recent developments have been welcomed positively. The newly passed has stirred debate within Kenya’s tech community. While it aims to formalise the sector and stimulate local ownership, it requires startups to spend at least 15 percent of their budget on research and development, and only startups that are fully Kenyan-owned can benefit from official recognition and government support.

Some entrepreneurs argue that the ownership clause could discourage foreign investment, a key driver of the local ecosystem’s early-stage growth. Others believe that the Bill, if implemented wisely, could increase long-term local value creation, prevent exploitative venture capital practices, and encourage more inclusive tech innovation.

Nonetheless, stakeholders agree that enya’s innovation landscape is evolving rapidly, with clear signs that Nairobi, in particular, is positioning itself as a continental leader and a future contender for a spot in the top 100 global startup cities.

With a growing population, high internet penetration, increased mobile usage, and expanding access to digital financial services, Kenya’s startup ecosystem appears well positioned to continue its upward trajectory.