Kenyan tech firms drop off in top ranking of Africa’s fastest growing companies

The fading of techies has come at a time when Kenyan startups have fallen on hard times despite receiving billions of shillings in funding from venture capitalists in recent years, including e-commerce platform Zumi, logistics firm Sendy and food techie Kune.

Of the seven Kenyan firms that made it to the top 100 fastest growing companies in Africa, only two companies, M-Kopa Holdings and IT & Software focused Impax Business Solutions, were tech-based firms compared to four in 2024 and eight in 2023.

E-mobility manufacturer Roam Electric AB was ranked the fastest growing company in Kenya, while hospitality chain TPS Eastern Africa, which runs the Serena Hotels, was second.

Other top fast-growing companies in the country are retailer Quickmart, fish dealer Victory Farms and East African Business Company.
Previously, micro-insurer and technology firm Turaco, buy-now, pay-later financier Lipa Later and e-commerce operator Copia, were among techies ranked in the Financial Times' top 100 fastest growing firms in Africa.

Other techies making the list in previous editions of the ranking included e-commerce firm Wasoko, Poa Internet, 4G Capital and Laterite.

Fintech companies which are firms leveraging technology to simplify the provision of financial services have also witnessed the cooldown in growth, with players like Lipa Later falling into financial challenges despite being a heavy beneficiary of new funding.

Chairman of the Digital Lenders Association (Dlak) Kevin Mutiso says fintechs have maxed out in terms of customer reach but notes that the companies are still expanding, albeit at a slower pace.

“We are still growing pretty fast, but if you look at the year-over-year growth, what you are seeing is a flattening of the curve,” he said.

“We grew practically from zero about a decade ago where we had zero borrowers and reached five million borrowers in 2020 and eight million borrowers in 2025. We have maxed out in terms of the people we can lend to.”

Lipa Later, which was ranked the second fastest growing Kenyan firm in 2024 and in position 25 on the continent, has since fallen on hard times despite receiving billions in funding.

The tech-led consumer credit provider Lipa-Later was placed under administration earlier this year, not long after securing at least Sh1.9 billion in equity and debt financing over three rounds for expansion into new African markets.

Founded in Nairobi in 2018, the firm offered higher purchase services to consumers by paying the retailer upfront and then collecting instalment payments from the buyer.

Read: Ways to mitigate challenges Kenyan startups are facing

The financial challenges faced by Lipa Later are not seen as industry-specific with the fallout from its struggles being seen as muted.

“When you see startups rise and fall, that means we have a healthy ecosystem. That means that people are taking risks on their capital, and some are succeeding while others are not,” added Mr Mutiso.

In 2024, startups including Copia, Gro-Intelligence, iProcure and Marketforce bowed out of the market, either in full or in part, mirroring the deterioration of the startup eco-system.

The collapse of at least eight Kenyan-born tech start-ups over the last three years has been puzzling, having raised close to Sh35 billion in investor funding according to a previous analysis by the Business Daily.

Agri-tech firm Twiga had absorbed most of the funding, taking up Sh23.4 billion in venture capital.

The unravelling of techies has dashed the hope of Kenya achieving its Silicon Savannah dream.

The startups were however hit by frostbite from the 2024 funding freeze after venture capitalists were spooked off by socio-economic induced upheavals.

Venture Capital (VC) funding to Kenyan startups dropped by Sh20 billion in 2024 as local founders received Sh41.4 billion compared to Sh61.5 billion in 2023 according to data from the African Venture Capital Association.

Kenya subsequently slipped from being the second-largest recipient of startup funding on the continent after South Africa to fourth place, falling behind Nigeria and Egypt.

Funding is however not the only problem faced by techies as other factors including doubtful operating models.

In a previous interview, Kenyan entrepreneur Bobby Ghadia whose initial tech firm PC World Limited collapsed in 2016, after being in business for more than two decades, said that some founders had failed to visualise ideas that provide unique solutions to tangible problems.

“Tech is a very tricky space. Unless you have a unique solution that solves real problems, you cannot survive. People usually have emotional connections to their ideas but when you analyse closely, there is no substance to what they are offering,” he said.

For fintechs, especially those in the lending space, rediscovering growth could be tied to expanding the customer base served from the current estimate of eight million borrowers.

The State-backed Hustler Fund, which has so far reached over 25 million borrowers, more than thrice the reach of fintechs, is expected to sieve out good borrowers, graduating them to private lending institutions such as banks and digital lenders.

Fintechs see themselves as a key facet of the Kenyan economy, having helped drive up the financing of 4G smartphones and the uptake of boda bodas.

“We are now a growth engine for the economy. We have financed the purchase of over two million boda bodas in the country and are funding up to 230,000 smartphones a month. This is all being done without banks or Saccos,” Mr Mutiso said.

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