Climate Technology Overtakes Fintech as Africa’s Leading Sector for Venture Funding
As the climate crisis deepens, climatetech is emerging as the leading sector for venture capital in Africa, surpassing fintech, which has long dominated the funding landscape. A recent report from London-based Britar reveals that climatetech accounted for less than a quarter of the total venture capital influx into Africa from 2016 to 2025.
The significance of climate technology in venture funding is projected to peak in 2025, with climatetech expected to contribute 40%—approximately $1.5 billion—of the overall investment, a substantial increase from the mere 13% or $206 million recorded in 2016. This marks a notable trend in the shift of investment focus, positioning climatetech as a critical area for growth in the continent’s entrepreneurial ecosystem.
“This growth has been accompanied by a rapid expansion in the number of funded companies and deals,” the report states in its analysis titled “The State of Climate Tech in Africa 2.0: Beyond the Headline Numbers.” Between 2016 and 2025, climate tech startups raised around $6.35 billion, with 779 companies benefiting from this vanguard investment, thanks to research conducted by Brighter in partnership with other institutions including Catalyst Fund and FSD Africa.
Nigeria Emerges as a Climate Investment Hub
Nigeria, the most populous country in Africa, is swiftly gaining recognition as the second-largest player in climate technology investments, just behind Kenya. The report indicates that from 2019 to 2025, Nigeria attracted 12.9% of the continent’s total climatetech investments. However, with Kenya and South Africa commanding more than half of the total investment pool, Nigeria faces substantial challenges if it aims to ascend to the leadership position in this sector.
Historically, Nigeria has been viewed as the fintech capital of Africa, boasting fintech revenues that exceed $14 billion, growing at a compound annual growth rate of 31.4%. This reputation is built on a robust payments ecosystem that has given rise to several unicorns, including Flutterwave, OPay, and Moniepoint. Nonetheless, the report underscores the rising allure of climate technology among international investors, suggesting that this sector could soon take a dominant position across the tech landscape, provided investment momentum does not wane.
Identifying Nigeria’s Climate Tech Opportunities
The report points to key opportunities for Nigeria in the climatetech arena, highlighting areas such as logistics, farmer-market linkages, and the reduction of post-harvest losses. These areas represent significant potential for leveraging the country’s resources and expertise in addressing climate challenges.
An illustrative example comes from Lagos-based Winich Farms, which, alongside Kenya’s Twiga Foods, is pioneering a mobile-enabled B2B supply platform. Winich and similar companies are developing solutions to early challenges faced by Twiga, focusing on enhancing market access, providing built-in finance, and streamlining logistics. By minimizing the need for extensive physical infrastructure, these companies can facilitate connections between farmers and markets, aligning supply with marketplace demand.
