Startups Co-Founded And Led by Women Remain Significantly Underrepresented in Africa's Venture Capital Ecosystem - Report
In Africa, there is a persistent underrepresentation of Female-led startups in Africa’s Venture Capital (VC) landscape.
Despite the growing visibility of women in tech and entrepreneurship, startups co-founded or led by women continue to face stark disparities in VC funding, especially as they advance beyond early-stage rounds.
According to a report by Africa: The Big Deal, a comprehensive analysis of 2,808 equity deals worth over $14 billion, tracked since 2019, reveals that only 25% involved a startup with at least one female co-founder. While this figure might seem encouraging on the surface, it also means that three out of four funded startups were founded exclusively by men.
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More troubling is the funding disparity. These female-founded startups attracted just 17% of the total capital, indicating that when they did raise money, they secured 1.5 times less on average than their male-led counterparts.
Focusing on startups led by women, the numbers are even more stark. Only 13% of the deals since 2019 involved startups with a female CEO, who is typically also a co-founder. These female-led ventures attracted just over 5% of the total funding, raising an average of 2.5 times less than startups with male CEOs. Disturbingly, this gap has widened over time.
Funding for female-led startups rose slightly in 2023 (16.6% for female co-founders, 8.2% for female CEOs), showing slow progress. Initiatives like gender-lens investing (e.g., Aruwa Capital, Janngo Capital) and accelerators like Catalyst Fund are emerging, but more diverse VC teams, dedicated funds, and STEM encouragement for women are needed.
In 2024, female-led startups accounted for 14% of deals but only 3% of funding—the lowest ratios recorded since tracking began in 2019. Preliminary data from January to May 2025 paints an even grimmer picture, with female-led ventures securing just 9% of deals and a mere 0.9% of the total funding.
Women founders are more active in less-funded sectors like edtech and healthtech, while male-dominated sectors like fintech attract more investment. Even in high-interest sectors, female-led startups receive less funding due to biases.
Key challenges include gender bias among investors (only 12% of senior VC partners in sub-Saharan Africa are women), limited access to networks, and structural issues like underrepresentation in STEM. 79.3% of female founders report perceived biases, and 74% feel disadvantaged when pitching to investors.
The funding journey further exacerbates the underrepresentation of women as startups mature. At the Series B and C stages, which encompassed 106 deals with an average value of $40 million, only 14% involved female co-founded startups, which raised just 11% of the total amount invested. Female-led startups fared worse, comprising only 5% of these deals and securing just 4% of the funds.
In contrast, at the pre-seed stage, female co-founded startups accounted for 28% of deals and 24% of the invested amount, with female-led ventures representing 15% of deals and 10% of funding. This stark drop-off highlights a systemic barrier as startups scale.
The notion that underrepresentation stems from a “pipeline issue” holds little weight. Investors have funded over 700 rounds involving female-founded ventures since 2019, averaging two deals per week and allocating $2.4 billion to these startups. However, female-founded and female-led ventures face increasing difficulty securing larger funding rounds as they mature, particularly for substantial investment tickets.
On a positive note, early-stage investors have cultivated a robust deal flow, though gender equity remains elusive. This presents an untapped opportunity for astute later-stage investors to capitalize on the potential of women-led ventures.
The data underscores a clear challenge; while progress has been made in early-stage funding, systemic barriers persist in later stages, limiting the growth of female co-founded and female-led startups. Addressing this gap will require concerted efforts from investors to ensure equitable access to capital across all stages of the funding journey.
