African AI startups contributed less than 1% as global AI funding hit highest-ever quarterly levels​

As artificial intelligence (AI) continues to witness funding explosion across the world, Africa appears to be trudging way behind as African AI startups contributed $4 million to the total global funding in the second quarter of 2024. This is according to a report by global technology startup analytics company, CB Insights.

African AI startup’s $4 million contribution is a paltry fraction of the total $23.2 billion recorded across the globe, representing less than 1 per cent of the total investment. The numbers, while a reflection of the comparatively low investment into artificial intelligence-based solutions on the continent are, however, not a reflection of its adoption.

Companies and organisations on the continent have continued to adopt artificial intelligence solutions for their operations in a bid to improve productivity, reduce waste of manpower and boost efficiency. The countries with the highest adoption rates in Africa are South Africa, Nigeria, Kenya, and Ghana. However, most of their artificial intelligence solutions are imported and more often dependent on global players like Microsoft, Google, etc.

A major problem with developing AI solutions in Africa is the absence of electronic data that is accessible. Another challenge is a lack of regulation and the overarching issues around data privacy and identity protection. Finally, there is a gnarling lack of technical skills required to build AI solutions from scratch. As long as these problems continue to exist, investors will not be very enthusiastic about backing solutions on the continent.

See also: Artificial intelligence has become a general-purpose technology

Global AI startup funding hits highest-ever quarterly level

AI startups across the globe raised a combined $23.2 billion in the second quarter of 2024. This represents a 59 per cent quarter-on-quarter increase from the $14.6 billion recorded in the last quarter (Q1, 2024). It also represents the highest global quarterly raise, edging the $23 billion raised in the second quarter of 2021.

“The jump was driven by a handful of $1 billion-plus rounds and outpaced the growth in broader venture funding by 8 per cent,” the report noted.

These handful of billion-plus rounds include Elon Musk’s xAI which raised $6 billion in a series B funding round during the quarter. This represents nearly 26 per cent of the total global quarterly funding. UAE’s G42 attracted the second-highest funding in the quarter with a $1.5 billion corporate minority raise, representing 6.5 per cent of the total investment.

Next is CoreWeave, an American startup that raised $1.1 billion in a series B funding round representing 4.7 per cent of the total. Both Scale and Wayve complete the $1 billion mega-rounds, attracting a billion dollars each in the quarter.

“A relatively small number of players have had an outsized impact on this upward trend, raising massive $1 billion-plus deals in Q2’24, including xAI ($6 billion) and G42 ($1.5 billion),” the report said.

xAI landed a major funding round in the quarter

The number of deals involved also witnessed an improvement, rising 16 per cent in the second quarter to hit 948, up from 819 in the last quarter. Similarly, the average annual deal size rose, hitting an average of $28.9 billion in 2024 so far. This is a 55 per cent rise compared to 18.6 million in full-year 2023.

Region-wise, the United States led the global funding effort, raising $15.2 billion across 476 deals. This equates to 66 per cent of the global AI funding total and 50 per cent of the global deal total. Europe came a distant second, raising $4 billion across 206 deals. Asia is next with $2.8 billion across 215 deals. Canada attracted $700 million across 29 deals while Oceania had $400 million across 9 deals.

At the bottom of the pile, Latin America attracted $100 million across 8 deals while Africa got $4 million across 5 deals. In total, 6 artificial intelligence startup unicorns were birthed during the quarter.

The post African AI startups contributed less than 1% as global AI funding hit highest-ever quarterly levels first appeared on Technext.

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As artificial intelligence (AI) continues to witness funding explosion across the world, Africa appears to be trudging way behind as African AI startups contributed $4 million to the total global funding in the second quarter of 2024. This is according to a report by global technology startup analytics company, CB Insights.

African AI startup’s $4 million contribution is a paltry fraction of the total $23.2 billion recorded across the globe, representing less than 1 per cent of the total investment. The numbers, while a reflection of the comparatively low investment into artificial intelligence-based solutions on the continent are, however, not a reflection of its adoption.

Companies and organisations on the continent have continued to adopt artificial intelligence solutions for their operations in a bid to improve productivity, reduce waste of manpower and boost efficiency. The countries with the highest adoption rates in Africa are South Africa, Nigeria, Kenya, and Ghana. However, most of their artificial intelligence solutions are imported and more often dependent on global players like Microsoft, Google, etc.

A major problem with developing AI solutions in Africa is the absence of electronic data that is accessible. Another challenge is a lack of regulation and the overarching issues around data privacy and identity protection. Finally, there is a gnarling lack of technical skills required to build AI solutions from scratch. As long as these problems continue to exist, investors will not be very enthusiastic about backing solutions on the continent.

See also: Artificial intelligence has become a general-purpose technology

Global AI startup funding hits highest-ever quarterly level

AI startups across the globe raised a combined $23.2 billion in the second quarter of 2024. This represents a 59 per cent quarter-on-quarter increase from the $14.6 billion recorded in the last quarter (Q1, 2024). It also represents the highest global quarterly raise, edging the $23 billion raised in the second quarter of 2021.

“The jump was driven by a handful of $1 billion-plus rounds and outpaced the growth in broader venture funding by 8 per cent,” the report noted.

These handful of billion-plus rounds include Elon Musk’s xAI which raised $6 billion in a series B funding round during the quarter. This represents nearly 26 per cent of the total global quarterly funding. UAE’s G42 attracted the second-highest funding in the quarter with a $1.5 billion corporate minority raise, representing 6.5 per cent of the total investment.

Next is CoreWeave, an American startup that raised $1.1 billion in a series B funding round representing 4.7 per cent of the total. Both Scale and Wayve complete the $1 billion mega-rounds, attracting a billion dollars each in the quarter.

“A relatively small number of players have had an outsized impact on this upward trend, raising massive $1 billion-plus deals in Q2’24, including xAI ($6 billion) and G42 ($1.5 billion),” the report said.

xAI landed a major funding round in the quarter

The number of deals involved also witnessed an improvement, rising 16 per cent in the second quarter to hit 948, up from 819 in the last quarter. Similarly, the average annual deal size rose, hitting an average of $28.9 billion in 2024 so far. This is a 55 per cent rise compared to 18.6 million in full-year 2023.

Region-wise, the United States led the global funding effort, raising $15.2 billion across 476 deals. This equates to 66 per cent of the global AI funding total and 50 per cent of the global deal total. Europe came a distant second, raising $4 billion across 206 deals. Asia is next with $2.8 billion across 215 deals. Canada attracted $700 million across 29 deals while Oceania had $400 million across 9 deals.

At the bottom of the pile, Latin America attracted $100 million across 8 deals while Africa got $4 million across 5 deals. In total, 6 artificial intelligence startup unicorns were birthed during the quarter.

The post African AI startups contributed less than 1% as global AI funding hit highest-ever quarterly levels first appeared on Technext.

 The numbers, while a reflection of the low investment into African AI startups and solutions are, however, not a reflection of its adoption.
The post African AI startups contributed less than 1% as global AI funding hit highest-ever quarterly levels first appeared on Technext.  

As artificial intelligence (AI) continues to witness funding explosion across the world, Africa appears to be trudging way behind as African AI startups contributed $4 million to the total global funding in the second quarter of 2024. This is according to a report by global technology startup analytics company, CB Insights.

African AI startup’s $4 million contribution is a paltry fraction of the total $23.2 billion recorded across the globe, representing less than 1 per cent of the total investment. The numbers, while a reflection of the comparatively low investment into artificial intelligence-based solutions on the continent are, however, not a reflection of its adoption.

Companies and organisations on the continent have continued to adopt artificial intelligence solutions for their operations in a bid to improve productivity, reduce waste of manpower and boost efficiency. The countries with the highest adoption rates in Africa are South Africa, Nigeria, Kenya, and Ghana. However, most of their artificial intelligence solutions are imported and more often dependent on global players like Microsoft, Google, etc.

A major problem with developing AI solutions in Africa is the absence of electronic data that is accessible. Another challenge is a lack of regulation and the overarching issues around data privacy and identity protection. Finally, there is a gnarling lack of technical skills required to build AI solutions from scratch. As long as these problems continue to exist, investors will not be very enthusiastic about backing solutions on the continent.

See also: Artificial intelligence has become a general-purpose technology

Global AI startup funding hits highest-ever quarterly level

AI startups across the globe raised a combined $23.2 billion in the second quarter of 2024. This represents a 59 per cent quarter-on-quarter increase from the $14.6 billion recorded in the last quarter (Q1, 2024). It also represents the highest global quarterly raise, edging the $23 billion raised in the second quarter of 2021.

“The jump was driven by a handful of $1 billion-plus rounds and outpaced the growth in broader venture funding by 8 per cent,” the report noted.

These handful of billion-plus rounds include Elon Musk’s xAI which raised $6 billion in a series B funding round during the quarter. This represents nearly 26 per cent of the total global quarterly funding. UAE’s G42 attracted the second-highest funding in the quarter with a $1.5 billion corporate minority raise, representing 6.5 per cent of the total investment.

Next is CoreWeave, an American startup that raised $1.1 billion in a series B funding round representing 4.7 per cent of the total. Both Scale and Wayve complete the $1 billion mega-rounds, attracting a billion dollars each in the quarter.

“A relatively small number of players have had an outsized impact on this upward trend, raising massive $1 billion-plus deals in Q2’24, including xAI ($6 billion) and G42 ($1.5 billion),” the report said.

xAI landed a major funding round in the quarter

The number of deals involved also witnessed an improvement, rising 16 per cent in the second quarter to hit 948, up from 819 in the last quarter. Similarly, the average annual deal size rose, hitting an average of $28.9 billion in 2024 so far. This is a 55 per cent rise compared to 18.6 million in full-year 2023.

Region-wise, the United States led the global funding effort, raising $15.2 billion across 476 deals. This equates to 66 per cent of the global AI funding total and 50 per cent of the global deal total. Europe came a distant second, raising $4 billion across 206 deals. Asia is next with $2.8 billion across 215 deals. Canada attracted $700 million across 29 deals while Oceania had $400 million across 9 deals.

At the bottom of the pile, Latin America attracted $100 million across 8 deals while Africa got $4 million across 5 deals. In total, 6 artificial intelligence startup unicorns were birthed during the quarter.