African startup founders are being encouraged to look beyond venture capital as regulators and investors consider how local capital markets can support business growth. At Moonshot 2026, Nigeria’s Securities and Exchange Commission urged founders to explore crowdfunding, debt markets and local stock-market listings as additional routes to raising capital.
SEC director-general Emomotimi Agama said startups could begin by raising money from trusted communities before exploring broader capital-market options. He also pointed to commercial paper as a way for companies to test investor appetite for debt financing.
The discussion adds a new dimension to the funding debate across African technology markets. Founders have spent much of the past few years navigating tighter venture capital conditions, while investors have placed greater emphasis on revenue, profitability and more disciplined spending. The question now extends to the range of financing options available to companies as they mature.
Debt has become a significant part of that picture. Partech Africa reported that African startups raised $1.64 billion through debt in 2025, equivalent to roughly 40% of total venture funding. The figure reflects the growing role of financing structures that allow companies to raise capital without selling additional equity, although debt also introduces repayment obligations.
The composition of startup funding has also changed. The African Private Capital Association reported that African startup funding reached $3.9 billion across more than 500 deals in 2025. Local investors accounted for 45% of the capital raised, compared with an average of 23% between 2022 and 2024.
That increase points to a larger role for investors based within African markets. Domestic capital can give founders access to investors who understand local business conditions, but the availability of funding is only one part of the challenge. Companies also need financing structures that match their revenue models, growth plans and capacity to repay.
The experience of startups navigating funding pressure has made that distinction more important. TechTrendsKE’s reporting on startup failures and retrenchments examined how companies that secured substantial funding still struggled with the economics of their businesses. The coverage contrasted Kenya’s approximately $984 million in startup funding in 2025 with the difficulties faced by several venture-backed companies.
Profitability has also become a more prominent measure of business performance. Google’s Africa managing director, Alex Okosi, said 60% of graduates from the latest Google for Startups Accelerator Africa cohort were already profitable, with average monthly revenue of $60,000. He also discussed venture debt and the growing role of African investors in supporting startups.
These developments provide context for the SEC’s call to consider a wider range of financing options. Crowdfunding can allow companies to raise money from communities and smaller investors, while debt markets offer financing that does not require founders to give up additional ownership. Public listings can provide another source of capital and a route through which early investors may eventually realise returns.
However, the availability of these options depends on the development of the markets supporting them. A company considering a public listing needs suitable market rules, investor demand, governance structures and financial reporting systems. Investors also need confidence that listed companies can provide reliable information and operate under enforceable market standards.
The discussion at Moonshot therefore connects startup financing with the broader development of African capital markets. Venture capital remains important for early-stage companies, but a mature funding ecosystem also needs ways to finance established businesses and create opportunities for investors to exit.
For founders, that means considering how the capital they raise fits the business they are building. A company with predictable revenue may be able to support debt, while a high-growth business with a longer path to profitability may require equity investment. Crowdfunding and public markets can serve different stages of that journey, depending on the company’s scale and ability to meet investor requirements.
The SEC’s message places those options within the startup funding conversation. African companies need capital to grow, but the markets around them also need to support the next stages of their development, including the point at which founders and early investors seek liquidity.
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