African startups raised $67.25m in disclosed funding during March 2026, according to data compiled by Launch Africa Base, as escalating conflict in the Middle East disrupted dealmaking activity across the continent’s northern corridor.
The total represented a sharp slowdown from the preceding two months, with Egypt — historically one of the region’s most active startup hubs — recording just one disclosed transaction for the month. The sole Egyptian deal was an undisclosed investment in Hamilton Labs, a Web3 infrastructure company, backed by Madagascar-based AXIAN Investment.
The downturn contrasts sharply with January and February, when Egyptian startups raised more than $100m across a dozen transactions, including a $50m pre-Series C round for quick‑commerce platform Breadfast, and a $20m strategic investment in NowPay.
Investors and analysts attributed the March slowdown to heightened risk aversion following the escalation of US‑Israeli strikes on Iranian facilities in late February. The conflict prompted travel restrictions across the region and forced several international venture capital firms to pause due diligence on new commitments.
Kenya led the March rankings with $27m in disclosed funding, driven primarily by a $25m Series A for Zeno, an East African e‑mobility company. The round was led by US‑based Congruent Ventures and included participation from Lowercarbon Capital and India’s Trifecta Capital.
Nigeria ranked second with $18m, anchored by a $15m mezzanine debt facility for Starsight Energy Africa Group, a cleantech company operating in Nigeria and Ghana. South Africa followed with $16.85m, supported by three fintech transactions: Littlefish’s $9.5m Series A, Happy Pay’s $5m seed round, and Orca’s $2.35m seed.
Angola and Morocco rounded out the top five.
E‑mobility and fintech accounted for nearly 70 per cent of total disclosed capital in March. E‑mobility ranked first with $25m, almost entirely attributable to Zeno. Fintech ranked second with $20.95m spread across five deals, reflecting a broader distribution of investor interest than the concentrated capital flows in the mobility sector.
Cleantech, cybersecurity, and logistics completed the top five sectors.
For the first quarter of 2026, African startups raised $554.5m, an 8.2 per cent decline from the $604.57m secured during the same period in 2025, according to Launch Africa Base data. The first‑quarter total included a strong January and February across multiple markets before the March slowdown.
Egypt’s absence from the March country rankings — it had ranked among the top three markets in each of the preceding two months — underscored the vulnerability of North African ecosystems to geopolitical shocks. The country’s startup sector had been recovering from a prolonged currency crisis and had attracted renewed interest from Gulf sovereign funds and international development finance institutions.
Analysts said the March pause was unlikely to signal a structural retreat from the market but reflected the difficulty of closing transactions during periods of acute regional instability.
“The long-term case for Egypt hasn’t moved,” said a London-based government relations expert, who asked not to be named in order to speak freely. “What moves deals isn’t conviction — it’s whether your due diligence team can get a visa and whether your insurer will cover the trip. Right now, neither is straightforward.”
Several Gulf‑based investors continued to deploy capital into the region during March, with AXIAN’s investment in Hamilton Labs representing a continuation of cross‑border flows neighbouring markets. Industry participants noted that regional capital from the Gulf had become an increasingly important stabilising force during periods when US and European funds adopted a more cautious posture.
The Egyptian government has been seeking to attract $4bn in venture capital investment by 2030 and recently introduced a startup charter aimed at reducing regulatory friction. However, officials have privately acknowledged that near‑term targets could be affected by the security environment.
For the broader African ecosystem, the March data highlighted a growing bifurcation between markets with deep domestic capital pools and those more dependent on international investors. Kenya, Nigeria, and South Africa — the continent’s three largest startup markets by deal volume — continued to attract transactions across multiple sectors, while smaller markets such as Senegal and Tunisia recorded little to no disclosed deals during the month.
Investors expect activity to recover in the second quarter should regional tensions de‑escalate. However, several fund managers have cautioned that prolonged instability could prompt a more permanent repricing of risk for North African assets.