Nigeria, South Africa, Kenya, Ghana, and Egypt, captured 85% of all private market deals in Q3 2024, according to the latest Stears Private Capital in Africa Report.
This dominance highlights their significant appeal to private investors, leaving only 15% of transactions for the rest of the continent.
The report, a quarterly analysis of private market transactions in Africa, revealed that technology and energy sectors attracted the bulk of investments in these five countries which Stears called its Big 5 economies.
All technology deals involved one of these countries, showcasing the enabling environments they provide for startups and scaling businesses.
However, the energy sector exhibited a narrower gap, with 85% of energy deals tied to Big 5 countries versus 62% in others.
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Investments in the non-Big 5 countries leaned toward debt financing, with 28% of deals in these markets being debt-based, compared to 18% in the Big 5. This reflects the lower-risk and stable financing structures often favored in less dominant economies.
Regionally, Southern Africa led private market activity in Q3 2024, accounting for 45% of all transactions, followed by East Africa (41%) and West Africa (33%). Central Africa lagged significantly, contributing just 8% of deals.
South Africa and Kenya were standout performers, each capturing a third of all private market transactions. South Africa dominated Southern Africa with 73% of the region’s deals, while Kenya contributed 80% of East Africa’s transactions.
Rwanda emerged as East Africa’s second-most active player, contributing 15% of African deals, while Namibia played a subdued role in Southern Africa with a 5% share.
West Africa displayed a more balanced distribution, with Nigeria leading at 71% of the region’s deals. Other contributors included Ghana (38%), Côte d’Ivoire (33%), and Senegal (29%).
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In contrast, Egypt dominated North Africa, attracting 93% of the region’s transactions, while Morocco accounted for just 21%.
Financial services and technology were key investment sectors. East and West Africa led in financial services, each capturing 46% of transactions in the sector. East Africa also led in technology deals (60%), while West Africa excelled in energy investments, contributing 46% of the continent’s energy deals.
