Africa’s startup exits are shifting from IPO dreams to local buyers

For Africa’s tech founders, the exit door is still open, but it no longer leads where many once expected. Between 2023 and 2025, the continent recorded more than 100 startup exits, roughly half through mergers and acquisitions, while public listings barely featured, leaving trade sales as the most reliable route to liquidity. 

The shift is not just about volume but about who is buying: regional banks, telecoms operators, insurers and private equity firms that already operate in these markets and understand the regulatory and political risks involved.

As 2026 begins, that buyer mix is changing founder behaviour. With late-stage capital scarce, initial public offering (IPO) windows effectively closed, and early-stage funding recovering only in pockets, many founders are choosing smaller, locally driven exits rather than waiting for global acquirers that may never arrive.

A funding winter feeds a deal wave

The rise of this exit machine is rooted in the comedown from Africa’s funding boom. Funding into African startups surged to over $3.3 billion in 2022, then fell by about 28% to $2.4 billion in 2023, with the number of funded startups shrinking by more than a third.  More recent counts suggest funding recovered to roughly $2–3 billion annually in 2024–2025, but the rush-of-money era has ended.

The change is now colliding with a cohort of African startups founded between 2015 and 2019, many of which last raised capital at 2021 valuations. They are larger, older, and need more cash than bridge financing can offer. At the same time, limited partners are pressing venture capitalists for returns, leading to a rise in exits even as new investment slows. The African Private Capital Activity Report recorded 63 exits in 2024, almost 50% higher than the previous year, the second-highest tally on record after 2022.

According to this TechCabal Insights report, there was a double‑digit merger and acquisition (M&A) volume in 2023, followed by a sharp acceleration. By mid‑2025, African tech had posted its highest half‑year M&A count ever, with fintech accounting for nearly half.  A year‑end review put full‑year 2025 deal numbers up nearly 70% versus the prior year.  In short, the funding winter has turned into a consolidation cycle, with a backlog of venture‑backed assets finally finding buyers.

The new buyers’ club

1. Regional incumbents, including banks, telcos, insurers, and retailers

If there is a single defining buyer of African startups in 2026, it is the African incumbent scrambling to digitise. Banks, telcos, insurers, and retailers are turning to acquisitions to gain an edge by buying licences, agent networks, and product teams instead of building from scratch.

South Africa’s Lesaka paid roughly $85.9 million for Adumo, a payments fintech, to bulk up its merchant acceptance network.  TymeBank acquired SME financier Retail Capital, turning a startup lender into a distribution engine for its own SME products.  In Kenya, Nigerian fintech Moniepoint acquired Sumac Microfinance Bank to secure a local licence and enter into East Africa’s credit market.

These regional incumbents buy startups that can move the needle on core metrics such as loan book growth, valuation, and merchant volume within 12 to 24 months. That logic is set to tighten in 2026 as shareholders take a harder look at digital transformation spend.

2. African scale‑ups as serial acquirers

The second emergent buyer is less obvious in the data but visible on the ground: African startups buying other African startups. 

The merger of Kenya’s Wasoko and Egypt’s MaxAB created a cross‑continental player in informal retail, quickly followed by further consolidation, such as the acquisition of Egyptian wholesaler Fatura.  In logistics and mobility, acquisitions like BuuPass snapping up QuickBus or Yassir buying smaller delivery players underline the same trend.  In January 2026, Flutterwave acquired Mono in an all-share deal to integrate open banking across its vast product and geographic reach. 

South African fintech Ukheshe acquired payments processor EFTCorp, whereas Kenyan banks are seeing their own payment and agency networks courted by acquisitive regional players. Licence‑buying transactions, such as Moniepoint–Sumac, show how regulatory assets are becoming acquisition targets in their own right.

3. Global players 

Global names still matter, but their role is narrower. Payment networks, software-as-a-service (SaaS) platforms, and infrastructure players have all picked their spots in Africa. Stripe’s acquisition of Paystack, WorldRemit’s deal for Sendwave, Equinix’s acquisition of MainOne, Deel’s buyout of payroll platform PaySpace, and BioNTech’s takeover of InstaDeep.

Global rates have steadied, and core markets are slowing, but Africa still offers double-digit growth in digital payments, connectivity, and consumer services from a low base. In 2026, the bar will be higher, with fewer acquisitions and buyers backing only high-conviction assets that function like infrastructure rather than stand-alone apps.

4. Private equity and secondaries

Secondaries accounted for roughly a third of exits in 2023–2024, according to AVCA, up from a five‑year average below 30%.  Another AVCA report logged 20 private equity (PE)- to-PE exits in 2024 alone, evidence of a maturing recycling loop even in a tight liquidity environment.

A regional PE fund may buy out an early VC and a founder in a profitable financial‑services platform, and a continuation vehicle might roll a cluster of consumer assets into a longer‑dated structure. But for LPs, these are often the difference between mark‑to‑model and cash‑on‑cash. 

The return of IPOs 

Africa’s public markets are slowly reopening to tech, but only for a small elite. In late 2025, Johannesburg and Casablanca hosted rare tech listings. South‑Africa‑linked Optasia and Moroccan fintech Cash Plus went public after years of drought.  

Across the continent, IPOs still account for a low single-digit percentage of startup exits, and there is little to suggest that 2026 will be different.  Where they do occur, liquidity is driven by local pension funds, insurers, and asset managers, not by the global tech investor base. 

The geography of buyers

Domestic acquirers already account for just over half of startup exits. Add in regional African buyers, and the intra‑African share climbs well above 50%.  Gulf and MENA buyers, often backed by sovereign capital, are becoming more visible in fintech, logistics, and healthcare, leveraging proximity to North and East Africa.  

US and European strategics continue to anchor the big‑ticket infrastructure and AI deals, while Indian and Japanese corporates are increasingly mentioned in health and consumer‑sector outlooks. This trend points to African startups being acquired by buyers already on the continent, firms that know the regulators by name and operate on the ground.