The global gaming industry has witnessed unprecedented growth and Africa has contributed only little to the growth trajectory of the industry - with the gaming industry in Africa long being described over the years as nascent. According to a recent report by Statista, the global gaming industry is projected to be worth over $384.90 billion by 2023. And although gaming isn’t unheard of in Africa, the industry is only now being recognised for input led by a few gaming startups in the region. 

The continent’s young and tech-savvy population positions Africa as a promising market for gaming enthusiasts, developers and investors alike. In recent times, the industry has closed out a number of deals that have not only signalled the growth of the industry but also signalled investor trust in the potential of gaming in Africa. According to a report by Newzoo, the African gaming market is the fifth largest market globally, generating $1.8 billion in revenue in 2020 and is projected to reach $3.5 billion by 2025 - signalling immense growth potential and interest in gaming across the continent.

Rise of Gaming in Africa

Gaming in Africa is made possible by a number of infrastructures like internet access, access to affordable and viable mobile devices as well as gaming consoles and with a vibrant youthful population in Africa, the number of gamers and key stakeholders in the industry has continued to rise steadily. Furthermore, a report by Statista reveals that the number of African mobile game users will rise to more than 310 million by 2027 with revenue soaring to $2.27 billion and an annual growth rate of 7.15% over the projected period. The report also revealed that there has been a steady increase in the number of platforms providing solutions to gaming and while the number of gaming startups is on the rise, the number of gamers, game enthusiasts and game developers will also continue to rise. Also, the impact of having a decentralised tech market in Africa in selected African regions has aided the availability of affordable smartphones, and improved internet connectivity which are key factors to aid growth.

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On the issue of internet connectivity, Africa has long had its share of struggles. However, with the introduction of key players and key stakeholders in the sector, the continent has experienced remarkable growth in its internet connectivity and penetration. For example, in Nigeria where internet penetration appears to grow year-on-year, issues regarding internet speed, cost and efficiency remain a key setback for the gaming industry in that region, however, with the introduction of 5G technology as well as internet service providers like Starlink, issues surrounding internet connectivity can be well mitigated in the region. Furthermore, GSMA's The Mobile Economy report also predicts a remarkable surge in the number of internet-connected smartphone users in sub-Saharan Africa, reaching a staggering 680 million by 2025. These statistics undoubtedly showcase the tremendous potential and increasing popularity of mobile gaming in Africa. However, many stakeholders in the continent have disclosed concerns over the scanty funding across the continent for gaming platforms.

Funding for Gaming Startups in Africa

As earlier disclosed, the global gaming industry is projected to be worth over $384.90 billion by 2023 and while this is a result of remarkable gaming products and design by gaming platforms as well as funding activities between investors alike, in Africa, the funding space has continued to grow rather slowly until recent times. The activities of gaming startups and founders have also played an integral role in positioning the industry to attract potential investors. In 2022, reports revealed that more than 10 gaming studios collaborated to form the Pan-African Gaming Group (PAGG). The group was created in order to tap into growth opportunities, including investor funds.

In the same year the PAGG was formed, the continent recorded remarkable investment and acquisitions which signalled growth and recognition of the African gaming sector. In September 2022, Metaverse Magna (MVM), a Nigerian blockchain gaming platform, successfully raised $3.2 million, resulting in a company valuation of approximately $30 million. With an ambitious vision in mind, MVM disclosed its plans to establish the continent's largest decentralized autonomous organization (DAO), empowering players to govern their own Alien Worlds. To achieve this goal, MVM is actively seeking crypto growth funds and strategic partnerships with like-minded organizations that align with their mission. By expanding the untapped crypto-gaming market not only across Africa but also globally, MVM is paving the way for a new era of gaming experiences in Africa.

During the same year, Skrmiish, a South African mobile app modelled as "play-and-earn gaming,” successfully secured $2.5 million in seed funding. This significant funding, according to Skrmiish, will help support its global expansion efforts, as it seeks to reach a wider audience beyond its home market in Africa.

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In January 2023, Carry1st, a South African gaming startup that develops and publishes enriching mobile games and content apps for African consumers raised $27 million in its Series B Funding round led by BITKRAFT Ventures, following a successful 2022 game, The President - which loosely explored a fictionalised version of Donald Trump. The President immediately became one of the most downloaded games in the United States.

Carry1st is also one of the few mobile games publishers serving the first generation of African smartphone users on the continent and the funding round was said to be the single largest funding by a gaming startup in Africa. The same startup had previously raised Series A rounds of $20 million in January 2022 and $6 million in May 2021. 

Following behind Carry1st is Egyptian e-sports platform Gbarena with a strategic move to acquire Galactech, a Tunisia-based company, in a share swap deal valued at $15 million. The acquisition positioned Gbarena to expand its presence in the rapidly growing North Africa market as the company also revealed its plans to secure Series A funding later in the year, with investors from the United States, Singapore, and the MENA region expressing interest.

In conclusion, the gaming industry in Africa is arguably just making headway to its full potential and while there are a plethora of opportunities for growth in the industry, there are still some challenges that need to be addressed head-on if Africa’s Gaming Industry is ever expected to reach its full potential. 

In a follow-up piece, we will discuss the challenges and opportunities for growth in the gaming industry in Africa. But for now, let us know what you think about the gaming industry in Africa and what areas you see the possibility of growth for the industry.