Past the Atlantic: Why European startups ought to think about Africa for his or her subsequent enlargement

When folks be taught that I assist European scaleups broaden into African markets, the response is commonly a mixture of curiosity and scepticism. One of many first questions that comes up is whether or not this type of enlargement dangers repeating patterns of colonialism. It’s a good concern and one which deserves considerate reflection. However the actuality on the bottom is much extra advanced. European startups are already constructing significant operations throughout the continent, fixing actual issues, and having actual impression.

When European founders ponder worldwide enlargement, they sometimes observe well-trodden paths. Spanish startups look to Latin America, UK corporations cross the Atlantic, whereas Germans purpose to seize “DACH”. Italian founders are principally absent overseas – truthfully, why depart la Dolce Vita? (Being Belgian-Italian, I’m allowed this joke!)

However what about Africa? Whereas the German VC and startup scene has been quietly over-wintering in Johannesburg for years, most European startups haven’t severely thought of the continent for strategic enlargement. This represents a missed alternative.

A $2.8 Trillion Leapfrogging Alternative

Africa’s mixed GDP stands at $2.8 trillion in 2024, representing the financial output of 1.4 billion folks. The “Large 5” – South Africa, Egypt, Algeria, Nigeria and Ethiopia – account for half of Africa’s whole GDP, providing European startups substantial strategic entry factors.

What makes Africa significantly compelling is its potential for technological leapfrogging. Having been a part of the administration staff behind Lazada in Southeast Asia in the course of the 2010s, I witnessed firsthand how commerce leapfrogged from offline on to mobile-first, fully skipping the desktop part. Africa is experiencing comparable transformations throughout a number of sectors.

If you wish to perceive Africa’s digital leapfrogging, simply take a look at cell cash. M-Pesa, launched in Kenya in 2007, now strikes sums exceeding half the nation’s GDP – proof that, in Africa, your telephone actually is your pockets. By 2020, sub-Saharan Africa was dealing with 64% of all international cell cash transactions, totalling $490 billion. For any fintech – assume Revolut, now eyeing South Africa – an internet of partnerships with cell operators similar to Airtel, Orange Cash, and MTN is crucial to plug into the continent’s monetary ecosystem.

The renewable power sector presents one other leapfrogging alternative. Africa has the world’s richest photo voltaic assets, however has solely put in 19 gigawatts of solar energy, or lower than 1% of the worldwide whole. The Worldwide Vitality Company initiatives solar energy might change into the most important electrical energy supply in Africa by 2040. And with Spain nonetheless investigating the reason for its latest blackout, Africa’s shift towards decentralised, off- or mini-grid photo voltaic is beginning to look particularly fascinating.

Classes from European Pioneers

To higher perceive how European corporations reach Africa, I spoke with three scale-ups which have already made the transfer. Their experiences present what works and what doesn’t.

Understanding the Native Market: Spotify

In 2025, Spotify grew to become Europe’s first tech firm to surpass a $100 billion market cap since SAP, proving that European innovation can scale globally whereas staying rooted domestically. Earlier than becoming a member of the elite membership of tech giants, it wanted to show it might seize the worldwide paid music section, together with in rising markets. For a direct-to-consumer enterprise with a freemium mannequin, I sense that is an much more essential information level within the firm’s fairness story.

In a dialog, Claudius Boller, Spotify’s former Managing Director for MENA and SSA (Sub-Saharan Africa), defined how Spotify’s technique in Africa was outlined by deep localisation somewhat than speedy enlargement. As an alternative of making use of a one-size-fits-all technique, the corporate studied numerous market realities, from cost methods to gadget limitations, earlier than deciding the place and the right way to function. For instance, Spotify launched a light-weight app tailor-made for slower networks and entry-level smartphones. Pricing was adjusted, providing month-to-month subscriptions beneath $2.50, with cost choices similar to Kenya’s M-Pesa built-in.

Claudius burdened that Africa’s mobile-first and quick digital adoption surroundings creates fertile floor for hyper-growth, however provided that corporations spend money on genuine localisation. Success is not only about product options; it calls for cultural relevance and infrastructure adaptation.

Succeeding By Partnerships: Ebury

That very same lesson is bolstered by Esther Illana, Chief Technique Officer at Ebury, a B2B fintech in cross-border funds and forex administration. She emphasises strategic partnerships and on-the-ground collaboration as key to unlocking progress and constructing belief.

Ebury adopted a partnership-first method to getting into Africa, teaming up with native cost specialists similar to dLocal to navigate the continent’s advanced regulatory and banking panorama. This technique enabled Ebury to shortly supply cross-border cost options tailor-made to African companies and SMEs, whereas constructing relationships with native business groups, shoppers and companions.

Investing for the Lengthy Time period: Glovo

Earlier this 12 months, I moderated a panel on tech in Africa with William Benthall, Glovo’s Director of Public Affairs, and I knew I’d faucet him for extra insights. William shared how Spain-born Glovo made Africa a strategic pillar of its progress. The corporate now operates in six nations, with Nigeria rising as its most promising market, even because it exited Ghana in 2024 as a consequence of native challenges.

Glovo’s B2C platform permits customers to order groceries, retail, electronics and extra, and has helped African companies generate over €1 billion in gross sales up to now. Of these gross sales, 90% went to SMEs, demonstrating the platform’s impression on native entrepreneurship and financial progress.

William highlights that Glovo’s success in Africa stems from steady funding, native hiring and management growth to speed up digitalisation and attain new markets throughout the continent. To help this progress, Glovo lately launched its Africa Graduate Program, providing future leaders a year-long, multi-country skilled growth journey.

All three corporations succeeded by adjusting to native wants as a substitute of copying what labored in Europe. They constructed partnerships, tailored their pricing, and developed options tailor-made to African markets.

Tech as a pressure for good

Once we speak about European enlargement into Africa, geopolitical concerns have change into extra pressing as international powers compete extra brazenly for affect throughout the continent. The Democratic Republic of Congo (DRC) exemplifies this energy dynamic. Chinese language state-owned corporations management 80 per cent of DRC cobalt output, with 7 billion US {dollars} in new infrastructure loans from China additional cementing that dominance in 2024. In response, the DRC is searching for “higher and extra diversified traders,” lately signing a US minerals-for-security deal. The deal, just like the US-Ukraine one, stays ambiguous and raises doubts about whether or not the Trump administration can decide to resolving one more advanced battle.

In contrast to extractive relationships, a sustainable method in Africa depends on long-term partnerships, investing in native expertise, empowering regional leaders and co-creating enterprise fashions tailored to African markets. By emphasising information switch and real collaboration, European startups can unlock the continent’s potential and create shared, lasting worth. If expertise is equally distributed, startups can present the nudge wanted for everybody to achieve their full potential.

Africa’s younger, digital-first inhabitants and leapfrogging potential supply progress alternatives that more and more saturated Western markets can’t match. As geopolitical tensions reshape international commerce relationships, European-African partnerships will solely develop in significance for each continents’ futures. The query is now not whether or not this engagement will occur. It’s already underway. The actual query is whether or not will probably be approached thoughtfully and sustainably.