African agricultural technology startups raised less than $170 million in 2025, marking the first time since the sector began tracking investments that both funding volumes and deal activity declined in the same year, according to the State of Agtech Investment in Africa 2025 report.
The report published by Briter shows that total funding into African agtech fell by nearly 20 percent from more than $200 million recorded in 2024, while the number of deals dropped by around 10 percent. The downturn extends a broader correction from the sector’s peak in 2022.
This slowdown contrasts with the wider African startup ecosystem, where funding volumes and deal activity posted their first year-on-year increase since 2022.
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“2025 marks the first year where both capital deployed and deal count declined simultaneously in African agtech,” the report noted. “The sector had shown tentative signs of recovery in 2024, but the rebound was largely driven by a small number of large concessional transactions rather than a broad recovery in investment momentum.”
The report also highlights the difficulty of scaling agtech ventures in Africa.
Out of more than 490 funded agtech startups tracked between 2016 and 2025, fewer than 10 percent have raised more than $10 million, and less than 2 percent have secured over $50 million in total funding.
These few scale-ups account for more than half of total sector investment, reflecting what the report describes as a “winner-takes-all” model, where leading companies expand across multiple segments of the agricultural value chain.
Companies such as SunCulture, Victory Farms, and One Acre Fund began in a single segment—irrigation, aquaculture, or farm inputs—and later expanded through vertical integration.
Others, including ThriveAgric and Apollo Agriculture, entered through financial services before expanding into inputs, aggregation, and market access.
Debt overtakes equity in funding mix
A notable structural shift also emerged in 2025, with equity accounting for less than half of total capital deployed for the first time.
Instead, debt, hybrid financing instruments, and grants formed the majority of funding raised by agtech companies across the continent. Analysts say the trend reflects growing investor preference for structured financing models tied to asset-backed or cash-flow-generating businesses.
“Commercial capital is returning to the market, but with a different playbook,” the report stated. “Investors are increasingly deploying debt and structured financing rather than relying primarily on venture equity.”
The shift reflects a more cautious funding environment following the global venture capital correction that began in 2022.
On-farm solutions face the steepest decline
Funding patterns also varied across segments of the agricultural value chain.
The sharpest drop occurred in on-farm solutions, which are typically designed to support smallholder farmers through services such as farm management tools, advisory platforms, and digital inputs.
Meanwhile, funding increased in pre-farm, post-farm, and retail segments. Much of the growth in these areas was driven by large debt financings tied to production inputs, logistics, and transportation infrastructure.
The report also examined four high-interest agtech categories—aquaculture, ag-biotech, post-harvest, and soil health- to better understand how scale is emerging across the sector.
For instance, a small number of large transactions heavily influence aquaculture funding, leading to year-to-year volatility.
Ag-biotech investment tends to focus on applied technologies and commercially deployable products rather than early-stage research.
Post-harvest solutions show the clearest pathway to infrastructure-led scale, with large financing rounds supporting logistics and aggregation businesses that move produce through the supply chain.
Soil health technologies are attracting a growing deal of activity, though most large funding rounds remain concentrated in East Africa, where donor and government programmes support adoption.
Women founders remain underfunded
The report also highlighted persistent gender disparities in agtech funding across Africa.
Between 2023 and 2025, the number of deals involving at least one woman founder increased steadily, indicating greater participation at early and mid-stage entry points.
However, the share of total funding going to women-led startups has not increased at the same pace.
Women-founded agtech startups remain concentrated in high-deal, low-volume categories such as on-farm services, ag biotech, and ag fintech.
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By contrast, women have limited representation in capital-intensive downstream segments, where the largest funding rounds typically occur.
“While inclusion has improved at the deal level, the shift toward larger downstream models means women’s participation risks falling further behind in funding terms,” the report said.
