The prolonged slowdown in venture capital funding is increasing mergers and acquisitions across Africa’s technology ecosystem, as startups choose consolidation over raising fresh capital in a selective investment market.
According to the State of Tech in Africa H1 2026 report, mergers and acquisitions are becoming a defining feature of the continent’s startup space as founders seek scale, profitability and longer financial runways amid persistent capital constraints.
The report noted that while investor sentiment has improved compared with the lows of 2024 and 2025, funding remains concentrated in fewer companies, forcing smaller startups to explore acquisitions, strategic mergers and acqui-hires as alternatives to fundraising.
Rather than pursuing aggressive expansion, startups are prioritising sustainable growth, operational efficiency and market consolidation trends that have made M&A activity more attractive to both founders and investors.
The report also highlighted several transactions completed during the first half of the year which signals that acquisitions are
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