For the third consecutive year, ICT-focused start-ups continued to attract the lion’s share of venture capital (VC), accounting for nearly two-thirds of total investment.
This, as data shows Southern Africa’s VC sector closed off 2024 with R13.35 billion in active investments across 1 325 deals, according to the 2025 SAVCA VC Industry Survey.
Conducted by the Southern African Venture Capital and Private Equity Association (SAVCA), in partnership with research firm VS Nova, the annual research initiative shows the ICT sector accounts for 65.9% of deal value, three times more than the next sector.
Within ICT, the top-performing sub-sectors were software (20%), fintech (15.9%) and online markets (7.6%), according to the survey.
Nicola Gubb, interim executive director of SAVCA, comments: “Behind these numbers lies the story of a maturing market, more sophisticated capital deployment, deeper investor networks, and an encouraging shift toward early-growth stage funding, especially Series A, which speaks to a growing confidence in scalable local innovation.”
Regional hubs, particularly the Western Cape and Gauteng, remain vital, with notable growth also coming from beyond SA’s borders, the study reveals.
It further highlights that there are encouraging signals in critical areas such as health tech, which rose to 20% of deal value – its highest share since 2015. This shift was driven by renewed investor interest in life sciences, biotechnology and medical devices.
“The consolidation of capital into ICT and health reflects a maturing, digitally-focused VC ecosystem that is aligned with global investment trends. It also raises important questions about sector diversification, which remains a priority for long-term sustainability.”
Overall, a total of R3.29 billion was deployed to start-ups in 2024, comprising R2.62 billion in equity deals.
In addition, the survey this year reported for the first time on debt made available by VC fund managers, alongside their equity investments. This amounted to R670 million for 2024.
Series A funding climbed to 42.5% of all deals – more than double the proportion recorded in 2023 – indicating a shift toward early-growth capital.
The number of investment rounds also climbed to 222, up 20% from the previous year, into 110 companies.
While the overall equity deal value declined year-on-year, the survey also indicated an increase in deal volume that reflects a broader diversification of funding activity, including more co-investors and growing use of alternative instruments like venture debt.
Commenting on the findings of this year’s survey, Reabetswe Mjekevu, investment principal at SA SME Fund, says the insights are reflective of the current downturn in the exit environment.
“However, the findings also point to a maturing VC landscape that is laying the groundwork for an environment that is ripe for stronger, more sustainable exits in the future, signalling a promising outlook for both investors and founders alike.”
The survey confirmed that exit activity remains a major constraint, with just three exits noted in 2024. Fund managers cited the lack of follow-on capital, limited buyer universe and regulatory hurdles, including exchange controls, as key barriers to exit.
To unlock the next phase of growth, survey respondents identified several strategic priorities, including attracting foreign direct investment, building international networks to help start-ups scale globally, and increasing the supply of quality, fundable deals.
VS Nova founder Stephan Lamprecht states: “South Africa’s VC landscape is showing promising growth, with renewed government involvement − particularly through fund-of-funds initiatives − being closely watched for its potential to transform the asset class and even encourage greater participation from pension funds and insurers.”
“If 2024 has shown us anything, it’s that Southern Africa’s venture capital sector is steadily shifting gears from promise to performance. I remain deeply optimistic about the future we're building together,” Gubb concludes.
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