Winter Is Thawing: A Unique Perspective on What 2025 Holds for Founders

Boom. Bust. Repeat. The dramatic economic cycles have shaped the tech landscape from the dot-com bubble to the 2008 crash, and most recently, from the dizzying heights of 2021–22 to the brutal winter of 2023–24. But here's the exciting part: as 2025 unfolds, the frost is finally beginning to thaw.

As I reflect on 2024, here's my perspective on what lies ahead in 2025.

First, the companies that survived the winter didn't just survive - they evolved. They grasped an essential truth: unit economics matters more than growth at all costs. Those who thrived maintained rock-solid fundamentals and disciplined cash management.

The smartest founders I know are keeping their runway at 18-24 months minimum. They're not betting on another funding bonanza like 2021. Instead, they're focused on what actually matters: building solid products, keeping customers happy, and having a clear path to profitability.

In Africa, something particularly fascinating is happening. While funding dropped 25% in 2024, we're seeing a shift in quality over quantity. Companies like MNT-Halan and Moniepoint are showing that great businesses can still raise significant rounds. The smart money isn't gone - it's just gotten pickier.

What's especially intriguing is how sectors are converging. Remember when fintech was just fintech? Take Omniretail for example - what started as a B2B e-commerce platform helping retailers manage inventory has evolved to offer embedded financial services like working capital loans and digital payments to their merchants. Similarly, we're seeing agritech companies developing sophisticated financial products for carbon credit trading. This convergence isn't just a trend - it's innovation responding to real market needs, where traditional sector boundaries become less relevant as solutions become more integrated. The lines are blurring in exactly the way innovation should work.

But here's the really interesting part about growth-stage funding: we've witnessed a clear pivot from quantity to quality in funding rounds, with major funds like Partech, Norsken 22, and TLcom showing increased selectivity despite having raised substantial capital. The due diligence process has become notably more thorough, often extending to 6–9 months, with growth-stage deals facing particularly intense scrutiny of their business fundamentals.

The good news? The thaw is coming. As we look toward 2025, the outlook for African startups appears promising. The expected improvement in macroeconomic conditions is likely to accelerate the deployment of accumulated dry powder into African startups. With global inflation projected to decrease to 4.5% in 2025 from 5.9% in 2024, we anticipate a more favorable investment climate that should encourage greater risk appetite among investors.

The startups that will win in 2025 won't be the ones waiting for easy money to return. They'll be the ones that learned the hard lessons of winter: build something people want, charge more than it costs you to deliver it, and keep enough cash to survive the unexpected. Everything else, including fundraising announcements, is just noise.

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