South African venture capital investors saw a 3x return on exits in 2022, totaling $17 million, according to the Southern Africa Venture Capital Association (SAVCA) survey. While this represents significant returns, the survey also revealed that loss-making deals still outnumbered the profitable ones. South Africa's exit market, long considered a hub for exits in Africa, has seen some challenges. Many exits have not delivered expected results, possibly due to startups exiting too early. The mismatch between the capital needed for growth and what's available could drive startups to sell rather than raise more funds. This trend, while not without challenges, leads to more smaller exits that recycle capital into the ecosystem, potentially benefiting investors.
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