Eloho Omame, partner at TLcom Capital, and Odunayo Eweniyi, co-founder and general partner at FirstCheck Africa, took the stage to unpack one of the hardest truths about building in Africa’s startup ecosystem: sustainability is key when scaling. This was the major takeaway from a panel discussion at Moonshot by TechCabal on Wednesday, October 15.
“There tends to be a lot of hype when it comes to raising money,” Omame said. “But fundraising doesn’t automatically mean you’ve achieved scale.”
Operational inefficiencies and weak revenue models are a few reasons why African startups fail in their first five years. The discussion centred on how startups must prioritise fundamentals, product–market fit, and operational efficiency over vanity metrics.
Eweniyi explained that founders often underestimate the operational challenges that come with growth. “The work doesn’t get easier when you scale, it actually gets harder,” she said. “You’re multiplying how many people you have to teach, and you’re investing more into training managers and talent about the mission of the company.” She added that “the infrastructure that carries you to one million users cannot carry you to five million,” urging founders to prepare for scale before chasing it.
The climb to scale remains steep for African founders. In 2021, one in five startups raised a follow-on round after seed funding, but by 2023 that figure had dropped to just one in twenty. Series A and B investments also declined last year, falling by 18% and 27% respectively. These later-stage rounds are more than just opportunities to raise bigger checks, they signal that a startup has moved from potential to performance, from experimentation to disciplined execution. The widening gap between seed and growth funding reflects not a lack of ambition, but the deeper challenge of turning early traction into sustainable operations.
Additionally, both speakers noted that scale often begins with understanding the right time to say ‘yes’ to partnerships, markets, or even customers that actually align with a company’s core mission.
Ultimately, in today’s funding climate, scaling isn’t a speed race; it’s a test of resilience, strategy, and operational readiness.
As Africa’s tech ecosystem matures, founders who survive the hype will be those who build patiently, intentionally, and with clear eyes on what truly works.