South Africa and Nigeria dominate the list of 130 businesses, hinting at the difficulties entrepreneurs from smaller countries face in building a continental presence – David Pilling
The Financial Times’ ranking of the fastest-growing African countries, now in its fourth year, reveals two trends. One is the prevalence of fintechs which, together with businesses in the IT and software sector, make up nearly 40 per cent of the top-ranked ones. The second is the outsized performance of Africa’s two biggest, albeit sluggish economies, South Africa and Nigeria, which account for well over half of the expanded list of 130 companies. “Fintechs dominate the ecosystem,” says Mobola da-Silva, a partner at Capria Ventures, an early-stage technology venture capital firm specialising in the global south.
“Asset heavy businesses, including in manufacturing, require much more capital,” adds da-Silva, whose firm invested in Moniepoint, a Nigerian fintech (16th on the list) that has become one of the latest African companies to achieve “unicorn” status. She says there are now 13 businesses that have achieved a valuation of at least $1bn on the continent.
The presence of 79 businesses from Nigeria and South Africa reflects the size and entrepreneurial depths of both economies. But it also hints at how difficult it has been for companies from smaller countries to build a continental presence in what is still a highly fragmented landscape.
“The big economies are obviously the most resilient when it comes to the entrepreneurial ecosystem,” says Aubrey Hruby, co-founder of the Africa Expert Network and an investor in early-stage African companies. “If you look at my investment portfolio, it’s all the big countries because you need scale for venture backed innovation and it’s hard to achieve that in small countries.”
The FT ranking, compiled in conjunction with research company Statista and now in its fourth year, orders companies according to their compound growth rate between 2020 and 2023. Because many fast-growing companies are privately held and do not publicly disclose detailed financial data, a ranking such as this can never claim to be complete. But the screening process (see methodology, in full article) ensures the list offers a meaningful snapshot.