Agritech funding in Africa drops to $168 million in 2025 as investor interest shifts

When Seyi Alabi, co-founder of Nigerian agricultural technology startup Crop2Cash, was pitching investors for a seed funding round in 2025, he felt the disadvantage almost immediately. Crop2Cash uses digital tools such as  Unstructured Supplementary Service Data (USSD) technology to provide formal financing to smallholder farmers. 

Despite having a minimum viable product, reaching over 500,000 smallholder farmers, and seven years of operations, Alabi sensed that being in agriculture shaped how investors received his pitch before the conversation properly began. 

“I could tell that I was starting from a goal or two down,” Alabi said. 

His experience mirrors a broader shift in investor interest in 2025, a trend evident in the funding data, as agritech slipped down the list of capital priorities across Africa’s tech ecosystem.

Data from the 2025 Africa Investment Report, an annual report of funding activity in the ecosystem compiled by Briter Intelligence, a market intelligence and data platform, shows that agritech funding declined to $168.1 million in 2025, down from $206.9 million in 2024. Deal volume also followed a similar trajectory, falling from 146 deals in 2024 to 135 deals in 2025. 

Other sectors, including fintech, logistics, and energy, captured a larger share of capital despite a general downward trend in deal counts across the continent. 

According to the State of Tech in Africa (SOTIA) report by TechCabal Insights, housing and real-asset-linked funding grew by 3465.2% to $82 million in 2025 from $2 million in 2024, and the fintech sector continued to absorb the largest share of venture capital at 40%, underscoring growing investor interest in infrastructure-heavy but commercially viable solutions.

The last five years have seen agritech funding move through an uneven trajectory. According to Briter Intelligence data, funding in the agritech sector peaked during the 2021 and 2022 funding surges, reaching record highs of $360 million and $483 million, respectively. Capital reversed sharply in 2023, when agritech funding fell by more than half to $194 million. A slight uptick in 2024 to $206 million was quickly undone by the further drop in 2025.

Why agritech startups struggled to hold investor attention

At the launch of SOTIA on January 23, 2026, industry leaders at a roundtable discussion described the pullback from agritech as part of a reorientation toward capital efficiency and faster-returning models, rather than a rejection of agriculture’s long-term importance. 

“Capital always follows the path of least resistance,” Lola Masha, partner at Antler, an early-stage venture capital firm, said. 

She pointed to the mismatch between agritech’s operating realities and venture capital expectations, explaining that sectors such as fintech offer a more natural fit for venture capital because they provide a much faster path to profitability. She also noted that agriculture’s exposure to climate volatility, informality, and fragmented data makes it harder to predict compared to sectors like fintech or energy. 

“Agritech is hard,” she added. “It’s a very tough space to be in.” Masha also pointed to the decline in the composition of capital that historically supported agritech. Much of the sector’s earlier growth was driven by development finance institutions (DFIs) and climate-linked capital. However, with capital shrinking on the DFI side, she said, capital flows into adjacent sectors like agriculture also shrink by extension.

“Globally, a lot of VC capital doesn’t necessarily always go into it (agritech) because it’s oftentimes [sic] supported by government capital, subsidies, or sovereign funds,” she said. “Expecting VCs in this environment (Africa) to shift into agritech may be a stretch, but it’s not a natural fit.”

From Alabi’s perspective, part of agritech’s funding challenge in 2025 was tied to conditions beyond investor sentiment alone, pointing to economic pressures facing farmers themselves. By November 2025, Nigeria’s food inflation had fallen for the fifth consecutive month to 11.08%, resulting in lower food prices in parts of the country, while the cost of operational inputs such as fertiliser remained elevated. 

The result, Alabi argued, was that farming stopped making economic sense for many smallholders during the year.

Faced with a tougher fundraising environment, Crop2Cash did not abandon capital raising, but it changed its strategy. 

“It gets to a point where you don’t have to die on the hill of fundraising,” he said. “When you have a product that works and users who are interfacing with your product, you can grow organically and generate revenue. “

The surge in agritech funding between 2021 and 2022 was driven by an era when investors were willing to allow longer timelines for returns and absorb higher risk across emerging markets. Once that cycle ended, agritech’s structural realities, including long production cycles, exposure to climate volatility, informality, and complex unit economics, became harder to justify for a venture capital framework that is focused on speed.