It is a general belief that 8 out of 10 startups are likely to fail within the first five years of launching. This projection of failure is attributed to stiff competition, a flawed business model, cost issues and failure to raise capital - and we have seen a number of startups fold up within the first five years of operation.

In Africa, technology solutions are growing rapidly with the introduction of many key players across several sectors. Startups are springing up across the continent with several goals among which, clinching a unicorn status is one of them.

A recent report by CBInsight reveals that the total number of startups globally has reached 1,000 as of Wednesday, 2 February 2022.

This is led by Chinese Bytedace and American Space X, valued at over $100 billion respectively and another 46 companies boasting of decacorn status (over $10 billion valuations), while roughly 31% of unicorns are valued at exactly $1 billion.

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The report also discloses that the total number of the world’s billion-dollar companies moved from 563 in 2020 to 957 in 2021 also improving to reach 1,000 in the early days of 2022, as the world added 43 unicorns across the globe in the first 33 days of the year.

Before now, about six years ago, there were no unicorn companies in Africa. However, according to the report, Africa accounts for about 7 startups worth over $1 billion - indicating a significant improvement and also spelling out a prosperous prospect for the continent.

As confidence grows for investors investing in Africa, Enrich Africa spotlights these seven unicorn startups in Africa.

African Startups With Unicorn Status

OPay (Nigeria)

Valuation: US$2 billion

This startup pivoted to unicorn status after SoftBank’s Vision Fund 2 led a US$400 million funding round in the company in August 2021. The funding round took the company’s valuation to US$2 billion. It also made OPay SoftBank’s debut investment in Africa.

OPay provides mobile money solution that comes with physical debit cards, POS machines, an offline banking solution and savings facilities.

Wave (Senegal)

Valuation: US$1.7 billion

Wave became a unicorn in September 2021 after a US$200 million Series A funding round that led to a valuation of US$1.7 billion.

Current investors in the company include global heavyweights Sequoia, Founders Fund, Stripe and Ribbit Capital. Wave also offers a mobile money solution that includes deposits and withdrawals, transfers and bill payments.

Jumia

Valuation: US$1 billion

This startup launched in Nigeria in 2012 and has expanded to serve Egypt, Morocco, Ivory Coast, Kenya and South Africa. Jumia was founded by ex-Mckinsey consultants, Jérémy Hodara (CEO) and Sacha Poignonnec (CEO). The company has also expanded to launch platforms like Jumia Food, Jumia Travel, Jumia Deals, Jumia One, Jumia Pay and others.

Flutterwave (San Francisco)

Valuation: US$1+ billion

Payment infrastructure company Flutterwave raised US$170 million in a Series C that took place in March this year. The funding round came at a valuation of US$1 billion, taking the company to unicorn status.

Flutterwave has recently been announcing a string of partnerships, including with MTN Group, 9PSB, and Currencycloud.

Interswitch (Nigeria)

Valuation: US$1 billion

Interswitch is a digital payments company, with solutions spanning transactions, collection, disbursement, card issuance and more.

The company became a unicorn after Visa picked up a minority stake in the company in 2019, leading to a valuation of US$1 billion. The deal was reportedly valued at US$200 million for 20% equity. The company had IPO plans for the first half of 2020, but the plans haven’t materialised thus far.

Esusu

Valuation: US$1 billion

Esusu is the most recent unicorn traced to the continent. The credit building startup reached unicorn late January after a $130 million Series B funding led by Softbank and reflecting a more than ten-fold increase in Esusu’s valuation from its previous funding round last July. The startup was named to the Forbes Fintech 50 list last year.

Andela

Valuation: US$1.5 billion

Andela is a global talent network that connects companies with engineering talent in emerging markets. Andela is a global company with operations across 5 continents.

The fintech was founded in 2014 by four professionals working in the online education and recruitment business; Iyinoluwa Aboyeji, Ian Carnevale, Jeremy Johnson and Christiana Sass, as a training company to match developers in emerging markets now known as technology hubs.

Fawry (Egypt)

Valuation: US$2+ billion

A listed company, Fawry is not a unicorn in the technical sense of the word (since it is a listed company, whereas unicorns are usually startups with a US$1+ valuation). Yet, it is widely considered to be one in the MENA region.

The company offers a wide range of B2B and B2C payment services, and trades on the EGX with a market cap of about US$1.5 billion as of 6 October.