Nairobi has bounced back to rank among the top 150 cities globally that are the most preferred markets for startup investments, a new report shows, even as it retains its top position among East African peers.
The latest Global Startup Ecosystem Index 2023 report published by sector research centre StartupBlink shows Nairobi improved 26 spots in the global rankings to hold the 137th position this year, up from 163rd last year.
On the continental front, Kenya’s capital climbed one spot to rank fourth in Africa, with a total score difference of less than 0.06 percent from the third-ranked Cape Town.
According to the report, Nairobi’s best-performing industry is energy and environment where it ranks 51st globally.
Kenya National Innovation Agency CEO Dr Tonny Omwansa has hailed the rise, terming it a clear demonstration of African cities’ potential to foster innovation, drive economic growth and make a lasting impact on the global stage.
“We are thrilled to see Nairobi's remarkable rise in the Global Startup Ecosystem Index, with an impressive jump of 26 spots in the global rankings. This achievement reflects the relentless efforts of the Kenya National Innovation Agency in spearheading the development of our vibrant startup ecosystem,” said Omwansa.
“Through strategic initiatives, collaborative partnerships, and a supportive environment, we continue to nurture a thriving community of innovators, entrepreneurs, and investors.”
On the downside, however, Mombasa, which is Kenya’s only other city to make it to the global top 1,000 list, has dropped by 46 slots from last year’s performance to rank 937 this year while still losing one slot in the region to hold the 10th position.
On a country basis, Kenya preserved its last year’s position as the 62nd globally and third in Africa but was however dislodged from the apex of East Africa by Mauritius.
Among the factors that have been attributed to Kenya’s consistency in maintaining startup attractiveness include active public sector involvement that has seen the establishment of tech hubs such as the Konza Technopolis as well as the enactment of the Startup Act which is a framework that encourages a culture of innovation and entrepreneurship.
“With access to a mature economy and a growing culture of entrepreneurship, Kenya offers a strong English-speaking point of access to the African market,” the report noted.