African startup funding experienced a significant downturn in March 2025, with startups across the continent collectively raising only $50 million. This figure, reported by African venture funding analytics company Africa the Big Deal, marks March 2025 as one of the slowest months for investment since late 2020, a period heavily impacted by the COVID-19 pandemic. The poor performance is primarily attributed to the predominance of smaller deals, with no African startup securing $10 million or more during the entire month, a rare occurrence not seen since the global lockdown.

This sharp drop follows an earlier high in January, where close to $300 million was raised, succeeded by a less robust but still optimistic February at $119 million. March's $50 million represents a substantial 58% decline from February's numbers, which in turn had seen a nearly 59% drop from January's $289 million. Considering December 2024's $340 million in funding, the initial strength of January 2025 might have been a continuation of a late 2024 funding boom that now appears to be dissipating. Furthermore, February 2025 had already been the slowest February since 2019, and with March's even weaker performance, 2025 seems to be setting unwelcome records.

Amidst this challenging environment, one of the more significant deals recorded was African fintech company Enza's $6.75 million seed funding round. Co-led by Algebra Ventures and Quona Capital, with participation from Dubai-based Network International, this investment was a standout given that no other startup reached the $10 million mark. Founded in 2022 by Hany Fekry and Hamish Houston, both former Network International executives, Enza specializes in building infrastructure for banks and fintechs, offering diverse local payment solutions including cards, wallets, and real-time payments. The new capital is earmarked for team expansion and the rollout of new products for its banking clients across Africa.

Adding to the cautious sentiment, 54 Collective, formerly known as Founders Factory, announced the cessation of its venture studio operations in Africa. This decision follows the conclusion of its partnership with the Mastercard Foundation on April 30, 2025, which had previously funded several of 54 Collective's initiatives, including its venture studio, Gen F accelerator, and Entrepreneur Academy. The company stated its inability to secure alternative funding to sustain the studio, leading to a severely reduced presence in the African venture funding landscape.

Looking ahead, there is hope for a resurgence in activity in April, traditionally a period that can sometimes see renewed venture company investment, similar to December. The expectation is that the upcoming month will bring about a much-needed increase in funding for African startups.