In the heat of the 2019–2021 venture capital bull run, Africa was the final frontier for global capital. High-profile funds from Beijing, Dubai, and Silicon Valley touched down in Lagos and Nairobi, writing checks at record speeds. By 2025, however, the landscape tells a different story.
Of the hundreds of funds active during that peak, over 500 “tourist investors” have effectively vanished from the continent’s deal flow. Their departure has left behind a landscape of “orphaned” startups — some of which have thrived through forced discipline, while others have collapsed under the weight of unsustainable models.
The Scale of the Exodus
The “tourist” era was characterized by investors who lacked local presence, Africa-specific mandates, or the stomach for long-term emerging market volatility. According to analysis of activity between 2015 and 2025, the retreat spanned every major investor category.
Major Departures by Category (2015–2021 vs. 2025)
| Investor Category | Notable Departures | Primary Reason for Exit |
| Chinese VCs | MSA Capital, Sequoia China, IDG Capital | Geopolitics, domestic regulation |
| Crypto/Blockchain | Binance Labs, Polychain, AU21 | 2022–23 “Crypto Winter” |
| US Micro-VCs | Lateral Capital, Ludlow Ventures | Fund consolidation, refocus on US |
| Growth/Late-Stage | DST Global, Greycroft, TPG Growth | Lack of IPO/exit track record |
| Corporate Strategic | Tencent, Yamaha, Allianz X | Portfolio pruning, ROI disappointment |
1. The Chinese Withdrawal: A Geopolitical Pivot
The most dramatic exit came from China. Between 2019 and 2020, Chinese VCs fueled the “super-app” wars in Nigeria and Egypt. Today, that capital has almost entirely dried up.
Funds like MSA Capital and Sequoia Capital China, which once backed giants like OPay and Lori Systems, are no longer active in new African deals. This retreat was driven by a “perfect storm”: a regulatory crackdown on tech within China, the US-China tech war, and the realization that the “copy-paste” model from the Chinese ecosystem didn’t always translate to African infrastructure.
2. The Orphanage: Survivors vs. Failures
The departure of 110+ investors created a class of “orphaned” startups. Their fate was determined by one factor: Unit Economics.
The Survivors: OPay and PalmPay
Surprisingly, the two largest remnants of the Chinese era — OPay and PalmPay — are thriving in 2025.
- OPay reached a $2.75bn valuation by 2024, boasting 50 million users.
- PalmPay reported doubling its revenue in a year.
- The Lesson: They survived because they achieved massive scale and operational profitability before their lead investors left. They transitioned from “VC-fueled growth” to “revenue-fueled survival.”
The Graveyard: Logistics and Mobility
The casualties are concentrated in capital-intensive sectors.
- Lori Systems: Once a $120m “unicorn” in the making, its valuation plummeted 96% to $5m by 2025.
- Sendy: Shut down in 2023 after failing to secure follow-on funding.
- Gokada: Succumbed to a mix of regulatory hurdles and investor flight.
In these sectors, the “tourist” model of subsidizing growth to capture market share proved fatal when the bridge to the next round was burned.
3. The Sector Patterns: Where the Music Stopped
The exodus was not evenly distributed. Logistics and e-commerce saw the highest failure rates, while fintech showed more resilience due to its ability to generate transactional revenue.
- Fintech/Payments: Lost hundreds of investors but remains the most funded sector via “committed” funds.
- Logistics: Saw a near-complete collapse of the startup model, with an 80% failure rate among heavily VC-backed players.
- Crypto: A mass extinction event. Over 20 funds exited the African blockchain space following the 2022 global crypto crash and local regulatory uncertainty.
4. Why the Tourists Left
The data points to three fundamental disconnects:
- The Exit Drought: Between 2022 and 2024, there were no meaningful IPOs or large-scale acquisitions. Growth tourists, looking for a 5-year liquidity event, realized the African timeline is often 10+ years.
- Currency Volatility: The dramatic devaluations of the Nigerian Naira and Egyptian Pound destroyed dollar-denominated returns, making even “successful” local companies look like failures on a global balance sheet.
- Lack of Proximity: Investors without “boots on the ground” struggled to provide the hands-on support needed to navigate local regulatory shifts (like the Lagos bike ban).
5. Who Stayed? The “Committed” Base
What remains in 2025 is a leaner, more specialized investor base. These are the funds with dedicated Africa mandates or Development Finance Institution (DFI) backing.
- Africa-Dedicated: TLcom Capital, Partech Africa, Novastar Ventures.
- Global Systematic: Y Combinator (still the most consistent seed-stage engine).
- The DFIs: IFC, BII, Norfund, and FMO.
These investors share a common trait: they view Africa not as a speculative “side-bet,” but as a core component of their long-term strategy.
The Bottom Line: A Healthier Ecosystem?
The “Tourist Era” was a painful but perhaps necessary maturation phase. While 500+ investors left and hundreds of millions of dollars in valuation evaporated, the startups that remain are battle-hardened.
The era of “growth at any cost” has been replaced by an era of “sustainability at all costs.” For the African tech ecosystem, 2025 marked the end of the hype cycle and the beginning of a more realistic, albeit slower, building phase.