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BD Insider: African startups raised over $1.5 billion last quarter from just six deals💰

BD Insider, Letter 107 covers the top six disclosed funding rounds by African startups in Q1 2022, Congo’s admission into the East African Community.

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Inside letter 107:

FIRS names MTN Nigeria as the ‘Best Tax Compliant Organisation’ in 2021
Congo’s admission into the East African Community
Top six disclosed funding rounds by African startups in Q1 2022.

Let's dive in!

Top six disclosed funding rounds by African startups in Q1 2022.

Before we get overwhelmed with the funding rounds in the second quarter of 2022, let’s take a quick look at what happened in the first quarter of the year. African startups raised over $1.5 billion in Q1 with the bulk of the investments going into fintech, e-commerce and logistics/mobility sectors.

From the data we have curated so far, these were the largest funding rounds in Q1 2022:

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FIRS names MTN Nigeria as the ‘Best Tax Compliant Organisation’ in 2021

Nigeria's Federal Internal Revenue Services (FIRS) has named MTN Nigeria as the "Best Tax Complaint Organisation" in 2021. The telecoms company paid a total of N618.7 billion in direct and indirect taxes to the FIRS in the 2021 tax year, making it the largest single biggest contributor to taxes in Nigeria at 13.5%.

While receiving the award during the National Tax Dialogue held in Abuja, MTN Nigeria's Chief Financial Officer, Modupe Kadri said, “[MTN] will continue to invest heavily in network expansion with a focus on expanding access to under-served communities. We also plan to connect an additional 2,000 rural communities in 2022.”

In 2018, Abubakar Malami, Nigeria's attorney-general asked MTN Nigeria to pay a total sum of $2 billion in tax arrears which covered import duties, value-added tax (VAT), and withholding taxes on foreign imports/payments. The federal government had said the multinational telecoms firm owed taxes from 2007 to 2017.

However, in January 2020, the $2 billion tax demand against MTN Nigeria was withdrawn. Since its incorporation in 2001, MTN has invested more than N2 trillion in the Nigerian economy and has paid more than N1.7 trillion in taxes, levies and other regulatory fees.

Congo’s admission into the East African Community

The Democratic Republic of Congo was officially admitted to the East African Community (EAC) as its seventh member on March 29, 2022, during the 19th Extraordinary Summit of the EAC Heads of State.

In 2019, DR Congo applied for membership into the EAC in an effort to improve trade and political ties with its East African neighbours. “[the admission] will allow Congolese citizens to travel freely to the other countries and trade will become much quicker, simpler and cheaper, which should benefit businesses and consumers in all countries,” BBC reported.

The East African Community is one of the most vibrant and best-performing blocs in Africa. This is according to the African Regional Integration Index which ranks blocs on five aspects of integration - trade, productive, macroeconomic, infrastructural and movement of people. Currently, it has six members: Burundi, Kenya, Rwanda, South Sudan, Tanzania, and Uganda.

“There are several benefits [DRC will] enjoy as part of the East African Community including the cross-border money transfer and payments platforms, the Regional Electronic Cargo and Driver Tracking System (RECDTS), the East African passport, One Network Area (ONA) linking telecoms, presence of TradeMark East Africa that facilitates the elimination of non-tariff barriers in the region, among others.” Diana Owuor, a Regional Policy analyst in East Africa stated.

Meanwhile, other analysts have said that the East African Community has gained bigger clout with the DRC’s huge population (consumer base) of about 90 million people and an economy of nearly $50 billion. It is estimated that the EAC has a population of 177 million people and an economy of $193.7 billion.

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