Introduction

Introduction

African private equity remains a compelling but selective investment opportunity. The market has moved beyond its early-stage growth narrative and is now better understood through the full investment cycle: capital raised, capital deployed, exits achieved and value realised. This edition of Bright Africa shows a market that has continued to function through difficult conditions, but where returns are increasingly dependent on disciplined underwriting, active ownership and credible exit planning. 

Capital is available, but deployment remains selective

Fundraising has been highly cyclical. After reaching USD 7.2 billion in 2022, the highest level in the dataset, African private equity fundraising declined sharply in 2023 and 2024 as higher interest rates, inflation, currency volatility, weaker distributions and constrained global allocations reduced investor appetite for illiquid assets. Despite this, the market has retained meaningful capacity for deployment. Africa-focused fund managers were estimated to hold approximately USD 8.3 billion in dry powder at the end of 2024, although deployment remains selective and constrained by the availability of institutional-quality assets. 

Market activity remains concentrated in a limited number of mature ecosystems. Over the most recent five-year period, South Africa, Nigeria and East Africa accounted for a significant share of transaction activity, reflecting where market depth, local capital, execution capability and investable business scale are most consistently present. This concentration should not be read as a weakness of the asset class, but as evidence that African private equity remains highly dependent on local market structure. 

The sector mix is also evolving. Information technology remains the largest contributor to deal activity, while financials continue to anchor capital deployment across the continent. Consumer staples have become more prominent, suggesting a stronger focus on essential demand, resilient earnings and proven business models. Capital remains available, but it is being allocated with greater care. 

Liquidity, pricing and manager selection

Liquidity remains central to the investment case. Trade buyers continue to provide the main exit route, while public market exits remain selective and market-specific. Recent activity in South Africa and Morocco shows that public markets can support meaningful liquidity events in the right conditions, but IPO exits are still not a broad-based solution. Secondary transactions and continuation structures are becoming more relevant as managers seek alternative routes to liquidity in a constrained exit environment. 

Pricing trends show that South Africa and the rest of Africa should not be analysed as a single market. In South Africa, private equity multiples have generally remained more conservative, reflecting lower domestic growth, tighter conditions and a more conventional relationship with listed market valuations. Across Africa excluding South Africa, private equity multiples have often traded above listed market multiples, reflecting stronger growth expectations, scarcity of high-quality private assets, control premiums and the limitations of thinly traded public markets as valuation anchors. 

A defining feature of African private equity is its lower reliance on leverage compared with developed-market buyout models. Debt is selectively available and private credit is growing, but African private equity remains predominantly equity-driven. This places greater emphasis on business quality, management execution and operational value creation. In this context, manager selection is not simply important; it is often decisive. 

The long-term case for African private equity remains supported by regional integration, infrastructure development, demographic growth, urbanisation and the increasing investability of digital and technology-enabled business models. However, these opportunities are not easily accessed. Investors must continue to navigate currency volatility, inconsistent reform implementation, elevated debt-servicing costs and constrained liquidity. 

The central message of this report is measured but clear: African private equity continues to offer attractive opportunities, but not passively, uniformly or without risk. The most favourable outcomes are likely to accrue to managers with deep local knowledge, prudent capital structures, disciplined entry pricing and the ability to create value actively through the holding period. 

How to read this report 

Private market data is inherently difficult to interpret, and these challenges are particularly pronounced in African private equity. The market is fragmented, disclosure is uneven, transaction volumes can be limited within individual countries and years, and managers do not report information consistently. Currency movements and changes in the mix of sectors, geographies and transaction types introduce further variability. Annual figures may therefore be materially influenced by a small number of large fund closes or transactions. For this reason, the report does not treat any single year as definitive. Instead, it considers African private equity across the full investment cycle: capital raised, capital available for deployment, private equity and related private capital transactions completed, exits achieved, prices paid and the role of debt. Pricing trends should consequently be interpreted as directional indicators rather than precise market benchmarks. 

The report assesses fundraising based on capital committed to Africa-focused funds at final close, measured in US dollars and analysed by year and geographic focus. Dry powder represents committed capital that has not yet been deployed and is therefore a derived estimate rather than a directly observed amount. Private capital transaction activity reflects primary investments into African portfolio companies, drawn from data shared by AVCA, RisCura’s data-sharing partner for this edition, and from RisCura’s proprietary transaction database, and counted by deal. Exits represent portfolio-company realisations classified by buyer type, including trade buyers, secondary private equity or other financial buyers, initial public offerings and other public-market exits, management buyouts and private sales. Pricing is assessed principally through reported entry EV/EBITDA multiples, where available, and is analysed by transaction size, sector, geography and period. Leverage is considered using net debt as a proportion of enterprise value at entry, where this information has been disclosed. 

Only approximately 52% of transactions in the underlying database have a recorded enterprise value, while approximately 10.5% have a recorded EV/EBITDA multiple. This is not unusual in private equity, where general partners (GPs) generally regard entry multiples, leverage terms and other deal-level economics as commercially sensitive. Disclosure to third-party databases is voluntary and inconsistent, particularly across African jurisdictions with differing reporting practices. The available data therefore reflects disclosed transactions rather than the complete universe of African private capital activity. 

Coverage also varies materially by region and sector. South Africa accounts for approximately one-quarter of the recorded deal count, while Central Africa contributes fewer than 100 transactions over the period covered. More detailed sector analysis is therefore limited in certain markets, particularly outside South Africa. Each exhibit should be interpreted with regard to its underlying sample size. Where a sub-sample is considered too small to support a meaningful conclusion, the relevant analysis has been omitted to avoid presenting potentially misleading results.   

South Africa is analysed separately from the rest of Africa because its private capital market differs materially in depth, transaction history, availability of listed comparables, disclosure of transaction multiples and deal composition. South Africa has historically had a greater concentration of buyout and broad-based black economic empowerment transactions, while venture capital, growth capital and infrastructure investments represent a larger proportion of activity in several other African markets. Combining these markets into a single African measure may therefore obscure important differences. Where appropriate, the report presents combined African, South African and Africa excluding South Africa views alongside one another.