• Francophone Sub-Saharan Africa hosts 860+ startups but faces deep structural weaknesses
  
  
• EY urges reforms in governance, talent, finance and R&D to scale innovation
  
  
• Without action, SSA-FA may capture just 10-15% of Africa’s tech investment
  

Francophone Sub-Saharan Africa (SSA-FA) is seeing a surge in tech events, hackathons and startups that occasionally raise tens of millions of dollars. But the region’s ecosystem remains fragile, fragmented and far from its potential, according to a new EY report.

The EY Innovation Observatory, released earlier this month, estimates that African startups raised about 3.2 billion dollars across 534 deals in 2024, with more than 30 of those deals located in SSA-FA. The region now counts more than 860 startups, its first fintech unicorn, and growing hubs in Dakar and Abidjan that are gaining visibility on the continent’s innovation map.

The study assessed 19 countries across six pillars: governance, human capital, research and development (R&D), infrastructure, finance and regulatory frameworks. It concludes that the region needs deep structural reforms to build a competitive tech industry, since small incremental measures will not be enough.

A dynamic but uneven landscape

EY describes an ecosystem developing at different speeds. Startup activity is expanding, supported by more than 80 incubators and accelerators. However, the fundamentals remain weak, with only 38.2 percent of the population using the internet on average and a persistent urban and rural divide.

The Observatory groups countries into four levels of maturity.  The most advanced group includes Senegal, Côte d’Ivoire, Benin and Djibouti.  A second group, which has more uneven fundamentals, includes Burkina Faso, Cameroon, Mali, Togo and Gabon.  A third group that is still developing includes Guinea, the Democratic Republic of Congo (DRC), Burundi, Mauritania and Niger. The most nascent ecosystems include Madagascar, the Central African Republic (CAR), Comoros, Chad and the Republic of Congo.

EY warns that without coordinated action to reduce fragmentation, SSA-FA is likely to capture only 10 to 15 percent of Africa’s tech investment flows, compared with more than 55 percent for Anglophone Africa and more than 25 percent for North Africa. Benin, Senegal and Côte d’Ivoire were notable performers in fundraising in 2024.

Weak governance and poor coordination

Governance is the first major weakness. Even the most advanced countries lack the coordination needed to build an integrated market. In the EY survey, 73 percent of ecosystem participants cited limited collaboration as the main barrier, 62 percent pointed to a lack of platforms for exchange, and 57 percent mentioned the absence of a shared long-term vision.

Ecosystem actors, including incubators, NGOs, donors, universities, startups and established firms, often operate in parallel rather than in coordination. Lagos is cited as a model, with more than 400 tech hubs, about 2,000 startups, three unicorns and strong collaboration around major events. SSA-FA, according to EY, needs leadership structures able to align government policy with private sector priorities.

Human capital, talent shortages remain

Talent remains a key constraint. Senegal, Benin, Côte d’Ivoire and Cameroon rank among the most advanced on this front, but only a quarter of surveyed actors believe the workforce is adequately prepared for innovation.

Senegal has more than 150,000 students, nearly 30 percent in scientific fields, while Cameroon’s eight public universities host more than 400,000 students and have expanded technical training. In emerging ecosystems such as Madagascar, CAR, Comoros, Chad and Congo, 74 percent of stakeholders judged the workforce poorly prepared.

Barriers include a limited innovation culture, skills that do not match market needs, and limited entrepreneurial training. EY calls for significant reforms in education systems in order to expand project-based learning, entrepreneurship courses and partnerships between universities and industry. Kenya’s Ajira Digital programme is highlighted as a relevant model.

R&D, strategic but underfunded

R&D is considered essential but remains severely underfunded. About 74 percent of respondents cited a lack of dedicated financing as the main barrier, which limits the ability of laboratories, universities and companies to turn research into marketable products.

Senegal, Benin, Burkina Faso and Mali stand out for sustained investment and international partnerships. Senegal allocated about 0.51 percent of GDP to R&D in 2021, compared with a regional average of 0.34 percent, and Benin has built modern facilities that support public and private collaboration.

Countries with stronger scientific bases, including Cameroon, Niger, Côte d’Ivoire, DRC and Togo, face limited coordination, constrained budgets and a reliance on international aid. Respondents also cited outdated infrastructure, limited commercialization of research results and prototypes that rarely reach the market.

Infrastructure gaps widen inequalities

Infrastructure quality varies sharply and affects the ability to develop tech-ready human capital. Internet penetration averages 38.2 percent in SSA-FA, compared with 73.2 percent globally. Electricity access stands at 50.4 percent. Mobile phone ownership is high at almost 78 percent, which supports the expansion of mobile-first digital services.

Djibouti, Senegal, Gabon and Côte d’Ivoire have relatively strong road, energy and digital networks. Senegal, for example, has 60.6 percent internet usage supported by widespread mobile connectivity.

Benin, Mali, Mauritania, Guinea and Togo are expanding infrastructure, but progress remains uneven. Rural coverage, energy reliability and transport networks remain weak. Cameroon, Comoros, Burkina Faso, Madagascar and Congo show progress but face low electrification rates and poor secondary roads.

The DRC, CAR, Burundi, Niger and Chad have the most severe gaps, with electricity access often below 30 percent and fragmented digital coverage.

Projects such as Sèmè City in Benin and Kenya’s Konza Technopolis illustrate the impact of innovation-focused infrastructure, with modern campuses, laboratories and prototyping facilities.

Finance, the weakest link

Access to finance is the most fragile pillar. Only 6 percent of respondents in advanced ecosystems described startup financing as satisfactory. In Congo, Madagascar, CAR, Niger and Comoros, 88 percent viewed financing conditions as insufficient or very insufficient.

In still-developing ecosystems, 77 percent also reported insufficient financing. Across all groups, almost none of the respondents rated financing conditions as very satisfactory. Banks are poorly adapted to startup needs, venture capital is scarce, and innovation-focused funds are limited.

According to 71 percent of participants, the main problem is the lack of financing mechanisms suited to early-stage companies. In Niger and Madagascar, fewer than 5 percent of startups obtain grants or loans dedicated to innovation. Seventy percent cited the absence of specialized investment funds, and 64 percent pointed to a lack of incentives and guarantees for local investors.

Regulation, weak and unpredictable

Regulation and institutional quality are critical for startup development. Yet, SSA-FA scores below both the African and global averages on regulatory effectiveness, reflecting unstable policies and limited legal security for entrepreneurs and investors.

Fifty-nine percent of respondents viewed the tax framework as unfavorable, 57 percent cited bureaucratic complexity and limited digital public services, and 17 percent said existing laws are not suited to innovation.

In the most nascent ecosystems, 74 percent judged the regulatory framework unfavorable. Countries that are still developing show more mixed results as reforms are introduced but implemented inconsistently. Consolidated ecosystems show moderate improvements, while advanced ecosystems score better but still face administrative and fiscal hurdles. Most SSA-FA countries now have national digital strategies, although only five have adopted Startup Acts.

A narrowing window

EY says SSA-FA has real strengths, including a young population, emerging hubs and success stories that can serve as models. However, weak governance, coordination failures, underfunded R&D and financing constraints threaten to hold the region back.

Restructuring the ecosystem requires more than new strategies. It requires clearer roles, stronger institutions and a more integrated Francophone tech market. As artificial intelligence, digital health and other technologies reshape global competition, the region needs not only more startups but an ecosystem capable of turning talent and ideas into competitive businesses at scale.

Muriel EDJO