Market Insights Financial Capital Raising Traditional Capital Raising

Venture Debt - Northern Africa

Northern Africa

The country in Northern Africa is expected to witness a Total Capital Raised in the Venture Debt market market of US$47.4m by 2024.
Traditional Venture Debt is set to lead the market with a projected market volume of US$38.3m in 2024.
When compared globally, the United States is anticipated to generate the highest Capital Raised with US$31,850.0m in 2024.
In Northern Africa, Venture Debt is gaining traction as a financing option for startups seeking capital in the evolving Capital Raising market.

Key regions: Brazil, Germany, United Kingdom, Singapore, China

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Analyst Opinion

The Venture Debt market in Northern Africa has been experiencing significant growth in recent years, driven by several factors such as increasing entrepreneurial activity, a growing start-up ecosystem, and the availability of funding options for early-stage companies.

Customer preferences: Entrepreneurs in Northern Africa are increasingly turning to venture debt as a financing option for their start-ups. This is due to the advantages it offers over traditional equity financing, such as lower dilution of ownership and the ability to extend the runway without giving up additional equity. Additionally, venture debt provides entrepreneurs with the flexibility to meet short-term cash needs while waiting for longer-term funding rounds.

Trends in the market: One of the key trends in the Venture Debt market in Northern Africa is the rise of local venture debt providers. These providers understand the unique needs and challenges faced by start-ups in the region and are able to offer tailored financing solutions. This trend is driven by the increasing demand for venture debt and the recognition of the potential for high returns in the region's growing start-up ecosystem. Another trend in the market is the collaboration between venture debt providers and other stakeholders in the start-up ecosystem. This includes partnerships with angel investors, venture capital firms, and incubators/accelerators. By working together, these stakeholders can provide a comprehensive support system for start-ups, combining financial resources with mentorship and industry expertise.

Local special circumstances: Northern Africa has a young and dynamic population, with a high percentage of tech-savvy individuals. This has created a fertile ground for the growth of the start-up ecosystem in the region. Additionally, the governments in Northern Africa have recognized the importance of supporting entrepreneurship and have implemented policies and initiatives to foster innovation and attract investment in the technology sector.

Underlying macroeconomic factors: The Venture Debt market in Northern Africa is also influenced by macroeconomic factors such as GDP growth, inflation rates, and access to capital. Economic growth in the region has been relatively stable in recent years, creating a favorable environment for start-ups. Additionally, low inflation rates and access to capital through both local and international investors have further supported the growth of the Venture Debt market. In conclusion, the Venture Debt market in Northern Africa is experiencing significant growth due to increasing entrepreneurial activity, a growing start-up ecosystem, and the availability of funding options. Entrepreneurs in the region are increasingly turning to venture debt as a financing option, driven by its advantages over traditional equity financing. The rise of local venture debt providers and collaborations with other stakeholders in the start-up ecosystem are key trends in the market. The young and dynamic population in Northern Africa, along with supportive government policies and favorable macroeconomic factors, further contribute to the growth of the Venture Debt market in the region.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on the amount of capital raised, the average of deal size and the number of deals.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use data from OECD, annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, CPI, number of small and medium-sized enterprises (SME), new businesses registered (number) . This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.