Algerian Startup Exit; Potential Benefits For The Ecosystem

One of the recent highlights in the North African ecosystem is InstaDeep’s exit via acquisition. The news broke when the Tunisian AI startup announced that a  German biotech/bio-pharmaceutical company, BioNTech, was in motion for its total acquisition. The deal had already gone through as the company already paid  $440 million of the agreed $684 million in cash.

This acquisition deal supports BioNTech’s plan to develop world-class AI-driven drug discovery research. This will propel the discoveries of immunotherapies and vaccines that will tackle diseases whose cure has not been met by medicine.

In basic terms, the AI startup is living a success story. The startup was able to secure Series B funding of $100 Million in early 2022, of which BioNTech in the investment participation.

In recent years, the African tech ecosystem has seen tremendous growth. This is evident in startup launches, the development of tech talents, the empowerment of female-led startups and innovation, and most especially funding.

With the amount of funds that have been pumped into the ecosystem in the last two years, it is obvious there has been significant attention toward the continent’s startup activities. Yet it would seem some part of the region receives more attention than others. According to Disrupt Africa, “Nigeria leads the way for tech startup funding on the African continent over the last eight years, with fintech companies the main driver.” But it seems 2023 is coming with a new switch.

The recent exit of InstaDeep is predicted to divert more attention to the Tunisian ecosystem. Why? There is a record high of 278 AI startups In Germany, yet BioNTech decided to acquire InstaDeep completely.

Although there could be other reasons for this acquisition such as inadequate access to relevant data and European data protection regulations for Germanian AI startups, this does not make the Tunisian AI startup less relevant or worthy of receiving attention or applause. This could also mean there are interesting tech activities going on within the ecosystem that are attracting intercontinental eyes.

The Ripple Effect Potential

The continental exit of the Tunisian AI startup puts local Tunisian startups up for recognition. The ecosystem has grown significantly as more startups launch with superb innovations. Although the likes of InstaDeep, GoMyCode, and Expensya, have been making waves through funds raised, the exit will have several intercontinental investors torch the light into other sectors of Tunisian tech.

This exit also serves as a charge to Tunisian startup founders. It has the potential to build its possibility mentality when it comes to fundraising and launching out.

It should not be quickly forgotten that InstaDeep secured the most funding in 2022. The startup’s funding success pulled a buzz within the ecosystem. With such feats achieved it is easy for other Tunisian startups to believe that it is achievable to secure such and even more funding.

While the possibility mentality develops amongst Tunisian startup founders, startup activity has the potential to develop also. In the coming months, the possibility of various updated product service launches should be expected. Many startups would want to give their product, service, or product services that touch it needs to meet funding standards and possibly exit standards. This action will therefore create a more sophisticated activity for the tech space, also upgraded business plans and detailed business structures to attract investors. This means there is an expectation of an ecosystem that does not just act right but puts its books right.

Another ripple effect this exit can produce is ” multiple starts off” in other tech sectors. The ecosystem should see more startup launches, which will quickly translate to growth. More startup launches will also generate more competition within the ecosystem, an attribute that has often contributed to the development.

The Other Side.

Although it sounds exciting that a startup exited the continent because of its ability to provide optimum service, this also deters the ability of the enablement structure of the ecosystem and the continent at large.

The knowledge that Africa is a developing continent gives the perception that there are only limited successes that can be attained within its large ecosystem, hence an exit is applause. With only four tech unicorns in the continent, a sit-up is important for Africa if we are to see more internal growth.

It should be noted that InstaDeep had its headquarter in London once it became globally recognized. This can potentially translate to the startup positioning itself outside Africa for more success than its continent had to offer.

If the continent can process more growth in funding and structure we should see many success traits asides from an exit.

If Tunisian startups can harness the potential that follows InstaDeep’s exit, there will be better stories, highlights, and major buzz coming from this North African ecosystem.