What’s on Goodwell’s radar? -March 2025 Edition
We hope to one day start this Radar with observations about how strong the global economy is, how the peace movement is flourishing, and how great the weather has been. Realistically, we know that this year has gotten off to a troubling start. Post-WWII understandings no longer apply, and international markets are teetering on a knife’s edge. Countries are turning inwards, emphasising a need to address problems internally rather than relying on foreign help. Many of us are feeling stressed and uncertain. But uncertainty also breeds opportunity; dare we hope that this moment draws more local investors to Africa’s entrepreneurs?
Space for African investors to step forward
This scenario has been building for some time, seen in the overall fall in foreign funding in Africa since 2022 – a recent example of which is the Mastercard Foundation withdrawing their $100 million commitment towards African venture capital firm, 54 Collective. This frustrating move had an immediate impact on many of the beneficiaries but also made clear that “building businesses that are dependent on the whims of philanthropies” isn’t a sustainable long-term solution for African startups. Will local African investors be able to step forward – and step up – for their continent’s businesses?
What factors are shaping African fintech?
As these investors look around for prospects, fintech remains an attractive industry for impact investment. Fintech in Africa, however, is a distinctly different sector than elsewhere in the world. A recent McKinsley report highlighted six key factors shaping the future of Africa’s fintech, including diverse partnerships, a consolidating market, fintech integration, the differing regional roles played by fintech across the continent, and a fragmented regulatory landscape.
Sectors on the rise in South Africa
We’ve found it interesting to consider this information in tandem with this piece from South Africa’s Mail & Guardian, examining what sectors are on the rise in South Africa. Rapidly shifting dynamics are showing that sectors including AI, energy, wealthtech (fintech focussed on wealth management and investment) and payment services, can successfully move forward and make impact – as long as they continue to evolve in these turbulent times.
$500 million for renewable energy in Nigeria
Further north, Nigeria and the UN have launched a $500 million fund for renewable energy, backed by the Nigerian Sovereign Investment Authority and the UN’s Sustainable Energy For All. Investors include Nigerian pension funds, and it will be managed by Africa50 and the African Development Bank (AfDB). Resonating deeply with Goodwell’s own mission to serve the un(der)served, this fund will be used to build and install solar-home and mini-grid systems for those without electricity in Nigeria.
Private equity turns to public markets for exits in India
Finally, we’ve been thinking a lot about exits this past month – honestly, who hasn’t? It’s a tough market for exits right now. This recent Business Standard article takes a look at private equity investors in India who are turning to public markets in their exit strategies. India saw $26 billion in total exits in 2024, mainly from initial public offerings (IPOs) and open market transactions, according to experts the IVCA (Indian Venture and Alternate Capital Association) Conclave. This is an approach which Goodwell and our Indian partners, Aavishkaar, have benefitted from in the past, inspiring our team to contemplate what similar tactics might look like in an African context.