Investments in Africa, Asia, CEE, TRENDS Latin America and the Middle East IN GLOBAL EMPEA’s 2021 report on global venture investment traces venture capital (VC) flows across Africa, Asia, CEE, Latin America and the Middle East. This year’s report includes new breakouts on cross-border TECH co-investment to measure the scope of global collaboration during a time of record venture investment in global markets. ollowing a blockbuster 2019, 2020 was a record year for VC investment across our markets, with USD67b F invested across 2,570 deals. 2020 was also an overall record year for seed, early-stage and late stage investments, with investment activity picking up momentum in Q1 2021. No. of Deals Capital Invested (USDm) 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 Africa 28 46 63 108 159 111 163 232 817 486 India 298 315 398 458 482 2,332 5,765 6,053 9,822 7,510 China 489 570 899 630 862 15,547 29,722 41,646 20,438 48,241 Southeast 158 167 222 281 1,083 2,161 5,251 3,520 Asia 289 5,406 Latin 197 249 463 433 500 1,141 1,976 4,093 America 488 4,844 CEE 55 71 48 53 114 124 193 614 1,087 1,131 Middle East 33 27 25 56 52 663 102 75 203 245 Note: Green numbers indicate a record value for the geography. Source: EMPEA. Data as of 31 December 2020. Note: Green highlights contain a record high value for the geography. EMPEA members can download the accompanying EMPEA Data Pack for 2020 fundraising and disclosed fund closes; exit totals and highlighted exits; all disclosed investments, sortable by stage, sector and HQ; stage analysis for the major markets; sector breakouts and fastest growing sectors; and more. E-Commerce logistics Fintech Proptech TECH VERTICALS 2 E-Commerce logistics Fintech Proptech Edtech Healthtech Super Apps Games enture investment in edtech, healthtech, biotech and logistics — themes that accelerated during the pandemic V — reached record levels by both deal count and dollars invested in 2020. Fintech and enterprise investment dominated across regions, with fintech capturing over 15% of all VC deals in 2020. The Media & software Entertainment Edtech Healthtech Super Apps Games Enterprise Software & IT Services Digital Security Foodtech pandemic shift to online learning and shopping accelerated deals in edtech and E-Commerce logistics Fintech E-CommerceProptech platforms & marketplaces. E-Commerce logistics Fintech Proptech OutsizedOutsized rounds rounds drove drove concentrations concentrations of capital of capital into intokey verticalskey verticals in 2020: in 2020: Media & Transportation/Mobility Travel CRM/Sales cleantech Entertainment Enterprise Software & IT Services Digital Security Foodtech Africa: Fintech India: Edtech Latin America: Fintech Middle East: Food/ (Flutterwave, Chipper (Byju’s, Unacademy) Edtech(Neon, Healthtech Nubank)Super Apps Games grocery delivery, Biotechnology Edtech Healthtech Super Apps Games Cash) restaurantsHRtech & cloud E-Commerce logistics Fintech Proptech E-Commerce logistics Fintech Proptech Transportation/Mobility Travel CRM/Sales cleantech Southeast Asia: Fintech CEE: Enterprise kitchens (Kitopi); China: Biotech (Kredivo, SYNQA); software (UiPath, fintech (Tabby.ai); Media & Media & logistics (Fetchr, (MGI Tech, XtalPi) logistics (Ninja Van, Entertainment Legium.io) Entertainment Enterprise Software & IT Services Digital Security Foodtech Enterprise Software & IT Services Digital Security Foodtech logistics Biotechnology E-Commerce Fintech Flash ExpressProptech ) TruKKer, Lyve) HRtech E-Commerce logistics VC FintechInvestment Proptechin Top Technology Verticals by Geography, 2020 or Edtech Healthtech Super Apps Games Edtech Healthtech Super Apps Games VC Investment in Top TechnologyTransportation/Mobility Verticals2020 Travel DistributionCRM/Sales by Geography, of cleantechVC Investment 2020 in Key Tech Verticals Transportation/Mobility Travel CRM/Sales cleantech DISTRIBUTION OF VC DEALS (% of total) Edtech Healthtech Super Apps Games Biotechnology Southeast Latin Middle Media & HRtechAfrica China India Media & CEE Edtech Healthtech Super Apps Games EntertainmentAsia America Biotechnology East Entertainment Enterprise Software & IT Services Digital Security Foodtech Enterprise Software & IT Services Digital Security Foodtech HRtech Agtech % % Biotech, Medical Devices, & Diagnostics Media & Media &2% Entertainment Entertainment Enterprise Software & IT Services EnterpriseDigital Software Security & IT Services DigitalFoodtech Security Foodtech E-Commerce Platforms Transportation/Mobility Travel CRM/Sales cleantech Transportation/Mobility% Travel %CRM/Sales 10%cleantech % % 1% & Marketplaces Edtech % 11% % % % Transportation/Mobility Travel CRM/Sales cleantech Transportation/MobilityEnterpriseBiotechnology Software Travel &CRM/Sales IT Services cleantech 1% 1% 1% 1%Biotechnology 2% % 10% HRtech HRtech Fintech 20% Biotechnology% 1% 2% 2% 1% 1% HRtech Food/Grocery Delivery, Biotechnology 10% Restaurants,HRtech & Cloud Kitchens Healthtech 10% % % % Logistics % % 12% Media/Games/Entertainment % % % 12% DISTRIBUTION OF CAPITAL INVESTED (% of total) Southeast Latin Middle Africa China India Asia America CEE East Agtech 1% Biotech, Medical Devices, & Diagnostics % 2% E-Commerce Platforms 10% 10% % 10% 1% & Marketplaces Edtech 1% 2% % Enterprise Software & IT Services % % 1% % 1% % Fintech 2% 1% 22% 0% % 21% Food/Grocery Delivery, 12% 2% Restaurants, & Cloud Kitchens Healthtech 1% % Logistics 11% % 22% 20% Media/Games/Entertainment % % % Note: Values represent proportion of total deal activity in a given geography (region/country) that accrued to the specified vertical. Values under 5 are not displayed. Source: EMPEA. Data as of 31 December 2020. AFRICA VC 2020 3 nvestment activity hit a record high of 159 transactions, indicating a growing appetite among investors for Iearly-stage deals. Venture investment in dollar terms dipped to USD486m in the absence of big ticket deals, although several large transactions were announced in Q1 2021. MOBILE PAYMENTS • Visa invested in Helios-backed Interswitch at reported Over a decade after M-Pesa revolutionized mobile USD1b valuation. payments across the continent, the theme continues to dominate tech investment activity in Africa, from fintech DIGITAL INFRASTRUCTURE startups to digital infrastructure. • Actis acquired stake in Nigeria-based data center • Airtel Africa’s mobile money services subsidiary AMC Rack Centre. raised USD200m from The Rise Fund and USD100m • African Infrastructure Investment Mangers acquired from MasterCard at a reported ~USD2.65b valuation. stake in Ghana-based data center Ngoya Etix DC. • Ethos-backed, South Africa-listed MTN Group recently • Meridiam invested USD48m in Africa-focused data valued its mobile money arm at ~USD5b and is center developer Raxio Group for a facility in the DRC. reportedly considering listing the unit. • Safaricom and Vodacom acquired Vodafone’s stake CROSS-BORDER in M-Pesa, bringing Africa’s largest mobile money • Global investors participated in 77% of deals, with service under full African ownership for the first time. Africa-based VCs as co-investors in over half. • US payments giant Stripe acquired Nigeria-based • Corporate-backed Japanese investors launched payments startup Paystack for a reported USD200m+, dedicated African vehicles. Kepple Africa Ventures, facilitating an exit for Beenext and Ingressive Capital. backed by accounting/back office services provider Kepple, was the most active investor in 2020 and closed its second seed fund, focused on West Africa, in Investor Participation in VC Deals (%) late 2020. Samurai Incubate closed its second Africa- 2019 2020 focused fund at USD19m in 2021; investors included Toyota Tsusho Corporation. E-Commerce logistics Fintech Proptech Local 42% 52% (HQ in Africa) • China-based investors pulled back after participating in three of the largest VC investments in 2019 and did not Global E-Commerce logistics Fintech Proptech 77% 77% participate in disclosed rounds over USD10m in 2020. (HQ outside Africa) US 37% 39% 2020 MOST ACTIVE VCS 2020 RECORDS Edtech Healthtech Super Apps Games Japan 26% 30% Kepple Africa Ventures, Seed investment Edtech Healthtech Super Apps NovastarGames Ventures, 500 (USD40m) & deals (66) E-Commerce logistics Fintech Proptech UAE 5% 9% Early-stage deals (73) Media & Entertainment France 8% 9% Enterprise Software & IT Services Digital Security Foodtech E-Commerce Medialogistics & Fintech Proptech Entertainment 2020 TOP SECTORS Enterprise Software & IT Services Digital Security Foodtech UK 6% 7% Fintech USD120m 32 deals Edtech HealthtechE-Commerce logisticsSuper Apps Fintech GamesHealthtechProptech China 6% 5% USD104m 20 deals Transportation/Mobility Travel CRM/Sales cleantech Transportation/Mobility Travel CRM/Sales cleantech & Biotech Note: ‘Local’ indicates investors based within the named Edtech Healthtech Super Apps Games geography (country or region). ‘Global’ indicates investors based Agtech USD81m 12 deals outside of the market. Biotechnology Source: EMPEA. Data as of 31 December 2020. Media & Biotechnology HRtech Entertainment Enterprise Software & IT Services Digital Security Foodtech Logistics USD55m 11 deals HRtech Edtech Healthtech Super Apps Games Media & Entertainment Enterprise Software & IT Services Digital Security Foodtech E-Commerce logistics Fintech Proptech Cleantech USD23m 15 deals Media & Entertainment Transportation/MobilityEnterprise Travel Software & IT ServicesCRM/SalesDigital Security cleantechFoodtech Transportation/Mobility Travel CRM/Sales cleantech Edtech Healthtech Super Apps