SDS 078: The 7 Buyers of African Startups
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In Part 1, I spoke about the "Crowded Door", the 1% success rate of founders fighting for the same Silicon Valley-style exit that rarely materializes in Nairobi or Lagos. If we are honest, the $500M acquisition or the Nasdaq IPO is a statistical outlier here.
But if you look closely at the data from the last 24 months, a different door has swung wide open. In 2025 alone, we saw a record 67 M&A deals across the continent, a 72% jump from the previous year. They were tactical, localized, and highly strategic moves.
Crowded door vs. Empty door
To engineer your way through this "Empty Door," you must stop pitching to "the market" and start building with a specific profile in mind. After reviewing the exits that actually closed, from Moniepoint acquiring Kenya’s Sumac MFB to Stitch gobbling up ExiPay, I’ve mapped out the seven buckets where the real liquidity lives in 2026.
The Taxonomy of Profiles: Who is Writing the Checks?
Bucket Profile | The Strategic Logic | The Real-World Signal |
1. The License-Hungry Giant | Regulatory Speed. In our markets, a license isn't just paper; it’s a 24-month moat. Giants will pay a premium to buy a regulated entity rather than wait on a Central Bank. | Moniepoint acquiring Sumac MFB for a Kenyan banking license or LemFi buying Bureau Buttercrane for an Irish EMI license. |
2. The Digital-First Tier-1 Bank | Defensive DNA. Traditional banks have finally realized they can't "innovation-lab" their way out of obsolescence. They are buying tech stacks and product teams to defend their deposits. | KCB Group taking a 75% stake in Riverbank Solutions to bolster their digital rails. |
3. The Vertical Aggregator | Margin Capture. This is the non-fintech player (Logistics, FMCG, Energy) realizing they are losing 3-5% on every transaction. They buy you to own the "pipes." | Platforms acquiring distributors or large retailers buying payment gateways to internalize their supply chain finance. |
4. The Regional Consolidator | Geographic Footprint. The "Big Four" (Kenya, Nigeria, Egypt, South Africa) are saturated. To maintain growth multiples, Series C+ scale-ups must buy the local winner in a "Tier 2" market like Ghana or Senegal. | Peach Payments (SA) acquiring PayDunya (Senegal) to instantly unlock Francophone West Africa via a single API. |
5. The Yield-Focused Financial Acquirer | The PE Consolidation. Private Equity isn't looking for "disruption." They want EBITDA. They buy cash-flow-positive startups to bundle them into a regional champion. | C-One acquiring Bankly or First Ally Capital taking 60% of Migo’s Nigeria operations to scale a proven lending engine. |
6. The Secondary Exit "Bridge" | Early Liquidity. In 2026, many "exits" aren't company sales. They are growth-stage funds buying out early angels. This is the primary path for founders to de-risk. | The rise of dedicated secondary funds that specifically target early-stage cap tables in mature Series B companies. |
7. The Global Arbitrageur | The Talent & Tech Play. International firms looking for high-quality, cost-effective engineering hubs or specialized AI tools built for emerging market constraints. | HearX (SA) acquiring Eargo (US) or African firms like Moove acquiring Brazilian players like Kovi. |
Moving from "Applicant" to "Asset"
The mistake most founders make is trying to be everything to everyone. If you are building a high-frequency payment tool, you are likely a Bucket 1 or 4 target. If you are building deep-tech infrastructure, you are a Bucket 2 target.
Once you identify your bucket, the way you build changes:
For Bucket 1 (Licenses): Your focus isn't just UX; it’s "Compliance-as-a-Product." You make your regulatory reporting so clean that an acquirer can "plug and play" in 30 days.
For Bucket 3 (Aggregators): You stop pitching "disruption" to the world and start pitching "efficiency" to the specific CEO of a logistics giant.
My Two Pesewas
We need to stop waiting for the "Silicon Valley Exit" while the "Regional Consolidation" is happening right under our noses. In 2026, being "investable" is no longer enough; you have to be "acquirable."
The data is clear: liquidity in Africa is no longer a "one-day" event at an IPO. It is a series of strategic maneuvers. If you don't know which of these 7 buckets your startup is filling, you aren't building an asset; you’re managing a liability.
In the final part of this series, I will move from the "Who" to the "How": the Africa Fintech Exit Radar. I’ll show you how to turn this taxonomy into a tactical playbook for warming up these seven types of buyers years before you ever sign a Term Sheet.
And if you found this helpful, share it with a fellow founder who should be engineering their exits.
That's all for today. As always, thank you for being an engaged reader. Let me know your thoughts on this issue. I read all your emails.
Until next time,
Jasiel
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