When Seyi Alabi, co-founder of Nigerian agricultural know-how startup Crop2Cash, was pitching traders for a seed funding spherical in 2025, he felt the drawback nearly instantly. Crop2Cash makes use of digital instruments reminiscent of Unstructured Supplementary Service Knowledge (USSD) know-how to supply formal financing to smallholder farmers.
Regardless of having a minimal viable product, reaching over 500,000 smallholder farmers, and 7 years of operations, Alabi sensed that being in agriculture formed how traders obtained his pitch earlier than the dialog correctly started.
“I may inform that I used to be ranging from a aim or two down,” Alabi stated.
His expertise mirrors a broader shift in investor curiosity in 2025, a pattern evident within the funding information, as agritech slipped down the checklist of capital priorities throughout Africa’s tech ecosystem.
Knowledge from the 2025 Africa Funding Report, an annual report of funding exercise within the ecosystem compiled by Briter Intelligence, a market intelligence and information platform, exhibits that agritech funding declined to $168.1 million in 2025, down from $206.9 million in 2024. Deal quantity additionally adopted an identical trajectory, falling from 146 offers in 2024 to 135 offers in 2025.
Different sectors, together with fintech, logistics, and vitality, captured a bigger share of capital regardless of a normal downward pattern in deal counts throughout the continent.
In keeping with the State of Tech in Africa (SOTIA) report by TechCabal Insights, housing and real-asset-linked funding grew by 3465.2% to $82 million in 2025 from $2 million in 2024, and the fintech sector continued to soak up the biggest share of enterprise capital at 40%, underscoring rising investor curiosity in infrastructure-heavy however commercially viable options.
The final 5 years have seen agritech funding transfer via an uneven trajectory. In keeping with Briter Intelligence information, funding within the agritech sector peaked in the course of the 2021 and 2022 funding surges, reaching file highs of $360 million and $483 million, respectively. Capital reversed sharply in 2023, when agritech funding fell by greater than half to $194 million. A slight uptick in 2024 to $206 million was rapidly undone by the additional drop in 2025.
Why agritech startups struggled to carry investor consideration
On the launch of SOTIA on January 23, 2026, business leaders at a roundtable dialogue described the pullback from agritech as a part of a reorientation towards capital effectivity and faster-returning fashions, quite than a rejection of agriculture’s long-term significance.
“Capital at all times follows the trail of least resistance,” Lola Masha, accomplice at Antler, an early-stage enterprise capital agency, stated.
She pointed to the mismatch between agritech’s working realities and enterprise capital expectations, explaining that sectors reminiscent of fintech supply a extra pure match for enterprise capital as a result of they supply a a lot quicker path to profitability. She additionally famous that agriculture’s publicity to local weather volatility, informality, and fragmented information makes it tougher to foretell in comparison with sectors like fintech or vitality.
“Agritech is difficult,” she added. “It’s a really robust house to be in.” Masha additionally pointed to the decline within the composition of capital that traditionally supported agritech. A lot of the sector’s earlier development was pushed by growth finance establishments (DFIs) and climate-linked capital. Nonetheless, with capital shrinking on the DFI aspect, she stated, capital flows into adjoining sectors like agriculture additionally shrink by extension.
“Globally, a whole lot of VC capital doesn’t essentially at all times go into it (agritech) as a result of it’s oftentimes [sic] supported by authorities capital, subsidies, or sovereign funds,” she stated. “Anticipating VCs on this surroundings (Africa) to shift into agritech could also be a stretch, however it’s not a pure match.”
From Alabi’s perspective, a part of agritech’s funding problem in 2025 was tied to situations past investor sentiment alone, pointing to financial pressures going through farmers themselves. By November 2025, Nigeria’s meals inflation had fallen for the fifth consecutive month to 11.08%, leading to decrease meals costs in components of the nation, whereas the price of operational inputs reminiscent of fertiliser remained elevated.
The end result, Alabi argued, was that farming stopped making financial sense for a lot of smallholders in the course of the yr.
Confronted with a more durable fundraising surroundings, Crop2Cash didn’t abandon capital elevating, however it modified its technique.
“It will get to a degree the place you don’t must die on the hill of fundraising,” he stated. “When you will have a product that works and customers who’re interfacing together with your product, you’ll be able to develop organically and generate income. “
The surge in agritech funding between 2021 and 2022 was pushed by an period when traders had been keen to permit longer timelines for returns and take up greater threat throughout rising markets. As soon as that cycle ended, agritech’s structural realities, together with lengthy manufacturing cycles, publicity to local weather volatility, informality, and sophisticated unit economics, turned tougher to justify for a enterprise capital framework that’s centered on pace.
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