Nairobi is the leading hub for Kenyan tech, with 97.4% of start-ups based out of the city, while Fintech is the leading sub-sector, with 93 or 30.2% of start-ups active in this space. Kenya is the second most popular investment destination on the continent after Nigeria.

This is according to the Kenya Startup Ecosystem Report 2022, released by Disrupt Africa.

According to the publication between January 2015 and November 2022, 242 tech start-ups raised a combined US$1,281,918,200.

So far in 2022, 63 Kenyan start-ups have raised funding, with the country’s running total for the year standing at US$506,686,000.

This is approaching double the US$291,983,000 raised by Kenyan start-ups in 2021, and represents a record annual total for the ecosystem, says Disrupt Africa.

Additionally, 55 or 17.9% of Kenyan tech start-ups have at least one female founder, and just short of half have taken place in some form of accelerator or incubator programme, both figures that are better than fellow tier one ecosystems Egypt, Nigeria and South Africa.

The 308 start-ups tracked here employ between them just short of 11,500 people.

Gabriella Mulligan, co-founder of Disrupt Africa, said, “Kenya has a well-established reputation as a pioneer in Africa’s tech space, as the home of the likes of M-Pesa, Ushahidi and the iHub, but its journey has been far from smooth. This report tells the story of the country’s start-up ecosystem and its development since 2015, with record levels of funding now flooding into Kenyan tech companies.”

Akshay Grover, Group CEO at Cellulant, one of several partners who collaborated with Disrupt Africa to release the report, said, “Kenya’s growing economy is home to the most resilient and innovative start-ups in Africa. These start-ups, solving problems common to Africa as they are in Kenya, cannot scale if making and receiving payments is an arduous task. Here at Cellulant, our payment rails enable global and local businesses to accept and make payments easily paving the way for their growth.

African Fintech flourishing

According to research from McKinsey & Company, African Fintech revenues could reach US$30-billion by 2025.

The research firm states that as the fastest-growing start-up industry in Africa, African Fintech raised over US$1,3 billion in 2021 alone, the success of Fintech companies is being fuelled by several trends, including increasing smartphone ownership, declining internet costs,expanded network coverage, and a young, fast-growing, and rapidly urbanising population.