The Real Gap Isn't Funding. It's Getting From A to B.
Photo by ThisIsEngineering via Pexels.
Let's cut to the chase! Everyone talks about African startups raising funding. Almost nobody talks about what happens to the ones that don't make it to the next round.
Here's the number that should stop you: of the African startups that raised seed funding in 2021, only 5.1% successfully raised a Series A within two years. For the 2022 cohort, it dropped to 4.2%. That's not a funding gap, that's a survival gap, and it's happening at exactly the stage where DFIs and growth-stage investors are supposed to step in.
So what does it actually look like when a company does make that jump? Let's use a real one.
The Case: Starsight Energy and BII
In March, Starsight Energy Africa Group, a clean energy provider serving commercial and industrial clients across West Africa, secured $15 million in mezzanine debt from British International Investment (BII), the UK's development finance institution.
A few things about this deal are worth sitting with:
It wasn't equity. BII chose mezzanine debt specifically so Starsight could scale without diluting existing ownership, a structure built for a company that's already proven its model and just needs growth capital to go further.
It solved a real, specific problem. Nigeria currently generates an estimated 40 gigawatts of power through diesel and petrol generators. Starsight's solar systems for commercial and industrial clients directly displace that cost and pollution. The investment case wasn't abstract, it was measurable from day one.
The DFI relationship was strategic, not transactional. BII's own UK Deputy High Commissioner in Lagos was quoted directly on the deal, this wasn't a quiet line-item investment. It was framed publicly as part of a broader UK-Nigeria clean energy commitment.
Why This Matters Right Now
If you're a growth-stage founder in energy, agriculture, health, or fintech, this is the pattern to study: proven unit economics, a specific measurable problem, and a capital structure matched to where you actually are, not where you hope to be in three years.
If you're a DFI or institutional investor, this is exactly the kind of company that's harder to find than it should be, not because they don't exist, but because most of them are heads-down building, not pitching.
That's the gap we spend our time closing.
Need Help Getting From A to B?
We'll catch you again soon.
Comments