Despite persistent challenges, a new analysis indicates a gradual improvement in the liquidity landscape for African startups and scale-ups. A new African Liquidity Index, published by the financial data firm Stears, has recorded 37 exits by fund managers so far in 2025. This development suggests that the African venture ecosystem is moving toward a more mature phase.
Key Exit Insights
The index, presented at the Africa Prosperity Summit in Lagos, reveals that these exits were predominantly driven by trade sales, accounting for 22 transactions. Notably, international buyers were involved in 40.5% of the exit activity, highlighting growing global interest in African tech.
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Average Holding Period: Exits occurred after an average holding period of 6.2 years.
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Geographic Leaders: Nigeria led the market with seven exits, followed by South Africa and Egypt, which recorded six each.
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Sector Focus: The consumer goods and services sector emerged as the most active, registering nine exits.
However, the index points to persistent opacity in Africa’s private markets, as only 16.2% of the total exit values were officially disclosed. This lack of transparency remains a significant hurdle for investors and founders.
Addressing Data Gaps and Future Prospects
Drawn from a decade of data spanning from 2015 to 2025, the publicly accessible index provides critical analysis on liquidity, exit classifications, and insights into realized and unrealized returns. This effort aims to fill long-standing data gaps that have previously hindered fund managers and founders from having clear market visibility.
Michael Famoroti, Stears’ Co-founder and Head of Research, commented on the significance of this milestone: “The ecosystem has now matured enough for us to tell a clearer story.” Famoroti acknowledged that a lack of data-sharing culture has historically constrained market insight but expressed hope that the anonymized aggregation provided by the index will encourage more fund managers to contribute their exit data.
Subdued Liquidity and Path Ahead
While the index suggests that liquidity conditions have marginally improved over the last 12 to 18 months, the market remains limited. Famoroti noted that exit routes are still “too narrow,” citing the under-reporting of secondary transactions and a limited depth of buyers, both strategic and financial. Analysts observe that economic volatility and shocks in major markets like Nigeria and Egypt have further subdued exit activity.
The industry is now anticipating progress through increased collaboration across funds, which is expected to accelerate exits as venture portfolios mature and Limited Partners (LPs) push for necessary returns. Stears forecasts a positive trajectory, stating, “We expect progress in the coming years, including more active local corporate acquirers and greater participation from international funds.”
The firm also hopes that public markets will eventually become viable and reliable exit pathways for successful African startups, further broadening the options for liquidity. This comprehensive data effort provides foundational clarity for all stakeholders looking to invest in the continent.
